On August 21, Xiaomi Corporation announced its unaudited consolidated financial results for the second quarter of 2024. The company's revenue achieved double-digit year-over-year growth for the third consecutive quarter, reaching 88.9 billion yuan, a 32% increase. The adjusted net profit was 6.2 billion yuan, marking a robust 20.1% year-over-year increase. The overall gross margin was maintained at 20.7%.

Looking at the performance of various businesses, Xiaomi's three core businesses—smartphones, IoT and lifestyle consumer products, and internet services—recorded revenues of 46.5 billion yuan, 26.8 billion yuan, and 8.3 billion yuan, respectively. The total revenue from innovative businesses such as smart electric vehicles was 6.4 billion yuan. It can be said that the overall performance of Xiaomi Group and its various businesses have exceeded the general market expectations, entering a new phase of explosive growth.

As of June 30, Xiaomi's cash resources surged to 141 billion yuan in the second quarter, laying an important foundation for the continuous development of core and new businesses, supporting Xiaomi's sustained explosive growth. Driven by continuous investment in core technologies, Xiaomi's artificial intelligence technology has significantly empowered its business development, enhancing the product capabilities and smart experiences of Xiaomi smartphones and smart electric vehicles, as well as improving the operational efficiency of Xiaomi's smart factories.

Xiaomi's founder, chairman, and CEO Lei Jun commented on Xiaomi's second-quarter financial report on Weibo, saying, "This is the best quarterly report in Xiaomi's history."

Smartphone shipments reached 42.2 million units, a 28.1% year-over-year increase.

In the second quarter, Xiaomi's global smartphone shipments reached 42.2 million units, a 28.1% year-over-year increase. According to Canalys, Xiaomi has maintained its position as one of the top three global smartphone brands for 16 consecutive quarters, with a market share of 14.6%. In terms of shipment volume, Xiaomi is the fastest-growing smartphone brand among the top five. With the increase in smartphone shipments, the business's revenue also grew by 27.1% year-over-year to 46.5 billion yuan in the second quarter.

According to Canalys, in the second quarter, Xiaomi's smartphone shipments ranked in the top three in 58 countries and regions worldwide and in the top five in 70 countries and regions. This growth highlights the increasing influence of Xiaomi smartphones in the international market and their accelerated expansion in Latin America, Southeast Asia, the Middle East, and Africa. In the Latin American region, Xiaomi's smartphone shipments entered the top two for the first time.

IoT business revenue soared, with air conditioner shipments exceeding 3.3 million units.

Xiaomi's IoT and lifestyle consumer products business maintained an upward trend in the second quarter, with revenue reaching 26.8 billion yuan, a 20.3% year-over-year increase, setting a new historical high. The smart major appliances segment also continued its strong performance, with revenue growing by 38.7% year-over-year.

According to Canalys, Xiaomi's global tablet shipments doubled year-over-year in the second quarter, becoming the fastest-growing brand among the top five tablet brands in terms of shipment volume.Xiaomi's wearable devices ranked third globally in terms of shipments in the second quarter, and second in China. Among them, TWS earphone shipments ranked third globally and first in China.

Xiaomi's air conditioner shipments exceeded 3.3 million units in the second quarter, with a year-on-year growth of over 40%;

During the same period, Xiaomi's refrigerators and washing machines also showed significant growth, with shipments exceeding 600,000 units and 400,000 units, respectively.

The number of monthly active users in both global and mainland China markets increased by more than 10%.

Xiaomi's internet services business continued to grow rapidly in the second quarter, with revenue increasing by 11% to a record RMB 8.3 billion. As Xiaomi continues to deepen and expand its global partner network, overseas internet service revenue in the second quarter increased by 32.9% year-on-year to RMB 2.7 billion, accounting for 32.1% of the total internet service revenue.

The internet user base continues to expand, with both global and mainland China monthly active users reaching historical highs. In June 2024, the global monthly active users reached 675.8 million, a year-on-year increase of 11.5%, while mainland China monthly active users reached 164.4 million, a year-on-year increase of 10.1%.

Xiaomi SU7 delivered over 27,000 units in the second quarter.

Xiaomi's first smart electric vehicle, the Xiaomi SU7 series, officially went on sale on March 28, with a price range of 215,900 yuan to 299,900 yuan. Thanks to its excellent appearance, decent configuration, and reasonable pricing, its market performance has greatly exceeded expectations. In the second quarter, the revenue from innovative businesses such as smart electric vehicles reached RMB 6.4 billion. Of this, smart electric vehicle revenue accounted for 6.2 billion yuan.

As Xiaomi continues to increase production and delivery efforts for the Xiaomi SU7 series, the delivery volume reached 27,307 units in the second quarter, with monthly deliveries exceeding 10,000 units for two consecutive months.

Since June, Xiaomi's electric vehicle factory has started operating in two shifts, aiming to achieve the group's goal of delivering 100,000 vehicles before November. In addition, the production target for the Xiaomi SU7 series in 2024 is 120,000 units. As of June 30, 2024, Xiaomi has opened 87 smart electric vehicle sales centers in mainland China, driving continuous order growth and providing users with comprehensive professional automotive support. According to official news, from July 1, the delivery of the Xiaomi SU7 series has further accelerated, with the expected delivery cycle potentially reduced by up to 5 weeks after placing an order.It is worth mentioning that Xiaomi Group's abundant cash resources ensure that Xiaomi's smart electric vehicle business can maintain a focus on technology and product development in the fierce market competition, thereby enhancing its influence and core competitiveness. Xiaomi continues to deepen its independent research and development capabilities, achieving new progress and breakthroughs in core technologies, significantly enhancing product competitiveness. In July 2024, the group unveiled the Xiaomi SU7 Ultra prototype car, announcing plans to set an impressive single-lap time on the Nürburgring Nordschleife in October. Its goal is to become the fastest four-door electric vehicle on the track within the next decade.

As of the end of the reporting period, the overall gross margin of Xiaomi's automotive business was 15.4%, which is still lower than the 21.1% gross margin of Xiaomi's mobile phone business during the same period. However, it is believed that with the continued growth in sales of the Xiaomi SU7 series, its comprehensive costs will be further spread out, thereby driving an increase in its gross margin.

At the performance communication meeting, Lu Weibing, a partner of Xiaomi Group and the group's president, also stated that after the scale increases in the future, the current high costs will be massively shared. He expressed confidence in the continuous improvement of Xiaomi's automotive gross margin in the future.

"Gross margin is very important to us. Without a good gross margin, it may lead to greater losses as the scale increases. As Xiaomi's first car, the company itself is quite satisfied with this gross margin. This reflects several capabilities of Xiaomi. First, supply chain management capabilities; second, intelligent manufacturing capabilities; third, the supply chain has confidence in Xiaomi, looking at Xiaomi from a larger scale, which allows Xiaomi's automotive to have cost relief." Lu Weibing further explained.

AI Empowerment Drives High-End Market Growth

Xiaomi Group continues to adopt artificial intelligence technology to enhance its "people × car × home" smart ecosystem. In the second quarter, Xiaomi's R&D investment continued to expand, with expenditures reaching 5.5 billion yuan, a year-on-year increase of 20.7%. Xiaomi's AI technology has achieved innovative breakthroughs in multiple fields, especially in the field of smart electric vehicles. The technology is widely applied, providing strong technical support for Autopilot, automatic parking, and voice interaction through Xiaomi's AI assistant.

In terms of smartphone products, Xiaomi has enhanced the multimodal recognition and understanding capabilities of its AI assistant, bringing users many features including AI document analysis and AI video generation. These innovations have laid the foundation for Xiaomi's growth in the high-end market.

According to third-party data, in the second quarter of 2024, Xiaomi's high-end smartphone models priced at 3,000 yuan and above accounted for 22.1% of the total smartphone shipments in mainland China, a year-on-year increase of 2.0 percentage points. The market share of smartphones in the price segments of 3,000-4,000 yuan, 4,000-5,000 yuan, and 5,000-6,000 yuan were 16.8%, 20.1%, and 8.9%, respectively, all achieving year-on-year growth.

On July 19, Xiaomi released its new generation of flagship foldable screen smartphones in mainland China—Xiaomi MIX Fold 4 and its first compact foldable screen device Xiaomi MIX Flip (with a 4.01-inch outer screen and AI offline translation function). The performance of these two foldable smartphone models greatly exceeded expectations, further enhancing Xiaomi's influence in the high-end market.