Xiaomi Corp reported a 31% rise in quarterly revenue, beating expectations, as strong demand for its second electric vehicle (EV) helped offset weaker smartphone sales.
Revenue reached 116 billion yuan (US$16.2 billion or RM68.5 billion), slightly above analyst forecasts of 115 billion yuan. Net profit nearly doubled to 11.9 billion yuan. The company delivered 81,302 cars in the second quarter, bringing first-half deliveries to over 157,000 — setting Xiaomi on track to surpass its 2024 total.
The surge was driven by the YU7 sport utility vehicle, launched in late June by co-founder Lei Jun. High demand has pushed wait times for the model to more than a year, underscoring both consumer appetite and production bottlenecks. Xiaomi has pledged US$10 billion to compete with industry leaders Tesla Inc and BYD Co, with a goal of breaking into the world’s top five carmakers. Lei said the EV unit could turn profitable in the second half of 2025.
Xiaomi’s market value has surged by about US$120 billion over the past year on optimism around its EV expansion, despite challenges. A fatal crash involving its SU7 sedan in March, which had its Autopilot engaged, prompted regulatory scrutiny of advanced driver-assistance systems. Meanwhile, Beijing has sought to ease an industry-wide price war that has squeezed margins. Xiaomi has so far avoided heavy discounting, thanks to robust demand.
Beyond EVs, Xiaomi’s other businesses also showed growth. Its Internet of Things (IoT) division is estimated to have recorded a 30–40% sales jump, supported by gains in household appliances and government subsidies. However, smartphone sales slowed to mid-single-digit growth despite steep discounts during June’s shopping festival, which pressured margins. Gross margin expanded year-on-year to 22.5%, supported by EV scale and a stronger IoT mix, though slightly weaker than in the previous quarter.
The company is also investing in artificial intelligence and semiconductor design. It recently unveiled its three-nanometre Xring O1 chip, built for devices such as the Tablet 7 Ultra, and plans to invest US$7 billion into chip development this decade.
