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Xiaomi's Q3 revenue down 10% on soft smartphone demand

November 25, 2022 8:52 am

Chinese top smartphone maker Xiaomi announced its third-quarter earnings on Wednesday night Beijing time, with revenue down 9.7%, hit by softening consumer demand.

Sales in the third quarter reached 70.17 billion yuan ($9.81 billion), down from 78.063 billion yuan the same quarter a year ago, slightly missing analyst expectations of 70.52 billion yuan.

Net income fell 59.1% to 2.12 billion over the period from 5.176 billion yuan one year ago.

Revenue from smartphones, which make up roughly 60% of Xiaomi's total sales, fell 11.1% year-on-year.

According to IDC, China's smartphone shipments in the third quarter came in at 71.1 million units, a year-on-year decrease of 11.9%. The decline was narrower than in the previous two quarters, despite continued weak demand.

Shipments declined for most brands, but Apple was the only one to buck the trend, jumping 36% to 11.3 million units. Analysts said the surge was due to demand for the iPhone 14 Pro models, while demand for the basic iPhone 14 model has been weak.

In India, where Xiaomi dominates the smartphone market, shipments have also not fared well. Last quarter, its shipments in the country fell 11% from a year earlier, according to Counterpoint Research.

Chinese mobile phone brands including Xiaomi, VIVO, and OPPO have been closely scrutinized by the Indian government. The Indian Enforcement Directorate earlier this year seized bank accounts of Xiaomi India after finding that the company had remitted $725 million to three foreign-based entities “in the guise of royalty” payments.

The company's executives refuted the allegations and raised a legal challenge to the ruling, Reuters reported earlier.

Xiaomi's stock price has tumbled nearly 50% since the beginning of the year.