Xiaomi reported a 18.9 percent drop in quarterly revenue on Wednesday as consumer demand for smartphones remained weak even as the economy recovered from the COVID-19 pandemic.
Sales in the first quarter of 2023 reached CNY 59.5 billion (roughly Rs. 4,91,900 crore), down from CNY 73.35 billion (roughly Rs. 6,06,400 core) in the same quarter a year earlier, roughly in line with analyst estimates of CNY 59.43 billion (roughly Rs. 4,91,300 crore).
Net income rose to 3.23 billion over the period, an increase of 13.1 percent from CNY 2.86 billion (roughly Rs. 23,600 crore) a year earlier.
After China lifted its stringent pandemic controls late last year, the country’s economy has recovered but consumers are spending cautiously. China’s smartphone sector saw no bounce back over the period at all. Total sales in China fell 11 percent in the first quarter of 2023, research firm Canalys reported in April. Xiaomi’s sales over the period fell 20 percent.
India, once Xiaomi’s top market overseas, has also proved less lucrative for the smartphone maker. Total smartphone shipments fell 20 percent across all brands in the first quarter, and rivals such as Samsung have eaten away at Xiaomi’s share of the shrinking market. The company has cut prices on several of its models in India and China in the hope of spurring demand.
Xiaomi is investing in the automotive sector in an attempt to diversify away from smartphones. The company plans to start mass production of its first car in the first half of 2024.
© Thomson Reuters 2023
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