TMTPost -- Xiaomi Corporation recorded highest than ever revenue with more stronger growth as the Chinese leading smartphone vendor is working on winning more premium consumers and absorbing losses from its big bets on electric vehicles (EVs).
Credit：Xiaomi
Xiaomi posted revenue of RMB88.9 billion (US$12.5 billion) for the quarter ended June 30, beating Wall Street estimates of RMB86.85 billion. The company not just broke its record of quarterly revenue but delivered a year-over-year (YoY) increase of 32%, the fastest pace of growth since 2021. Operating profit that quarter soared 45.7% YoY to RMB5.89 billion, compared with expectation of RMB4.1 billion by analysts. In comparison, revenue for the first quarter rose 27% YoY and operating profit plunged 37.6% YoY.
Net profit for the second quarter was RMB5.07 billion, up 38.3% YoY, better than analysts projected RMB3.84 billion, and adjusted net profit of RMB6.18 billion also beat projection of RMB4.85 billion, representing a 20.1% YoY increase. The gross margin for the second quarter stood at 20.7%, down from 21.0% a year earlier, still topping Wall Street anticipated 19.6%.
The April to June period is Xiaomi』s first quarter to report sales of its EV business since the company launched its first EV model SU7 in March and began delivery a month later. Revenue from smart EV and other new initiative reached RMB6.4 billion, including RMB6.2 billion from EV. The gross margin of the segment logged 15.4%, 5.3 points less than the overall margin. While the segment booked an adjusted net loss of RMB1.8 billion, the overall adjusted net profit notched a 20.1% YoY increase, down from a record high of RMB6.5 billion Xiaomi set in the beginning quarter of the year.
Xiaomi delivered 27,307 SU7 Series vehicles in the second quarter, and the average selling price (ASP) of smart EV was RMB228,644 per unit, compared with starting price of SU7: RMB215,900. cost of sales related to EV and other new initiatives was RMB5.4 billion, accounting for 7.6% of total sales cost in the June quarter and 6.1% of total revenue that quarter.
Xiaomi said its EV factory has been continuously ramping up, with double-shift operations started in June 2024 and optimization and maintenance of the production line in July 2024. The company reconfirmed its expectation that it can achieve the goal of delivering 100,000 vehicles by November, a month ahead of schedule, and added it will strive to reach a new target of delivering 120,000 vehicles for the entire year of 2024.
Xiaomi』s core business smartphone delivered a stronger-than-anticipated sales for the second quarter. Smartphone revenue gained 27.1% YoY to RMB46.52 billion, versus analysts』 projection of RMB46.27 billion. The gross margin of smartphone business was 12.1%, decreasing from 13.3% a year earlier, mainly due to the increased competition in mainland China and the increased price of key components. Xiaomi said its smartphone shipments increased 28.1%YoY to 42.2 million units in the second quarter, outperforming the 11.9% year-over-year increase in global smartphone shipments in the second quarter of 2024, according to Canalys. The ASP of Xiaomi smartphones dropped slightly 0.8% YoY to RMB1,103.5 per unit in the second quarter, primarily driven by the increased competition in the home market, as well as the growth of sales in emerging markets which carry lower ASP.
IoT and lifestyle products, the largest division second to smartphone, generated a record high of RMB26.8 billion, a YoY increase of 20.3%, and gross margin rose 2.2 points YoY to 19.7%, slightly down from a quarterly record of 19.9% three months ago. Excluding smartphones, tablets and laptops, the number of connected IoT devices on Xiaomi AIoT platform reached 822.2 million by the end of June, up 25.6% YoY, and the number of users with five or more devices connected to our AIoT platform grew 24.2% YoY to16.1 million. The monthly active user (MAU) of Mi Home App grew to 96.9 million in June, up16.8% YoY. The MAU of AI Assistant16 grew to 131.7 million, up 12.4% YoY.