Xiaomi revenues up by a third due to strong phone sales and triple-digit European growth
- Reference: 1606381389
- News link: https://www.theregister.co.uk/2020/11/26/xiaomi_q3_20/
- Source link:
The Chinese gadget maker reported [1]calendar Q3 revenues of ¥72.2bn (£8.23bn), up 34.5 per cent compared to the same period last year. These were bolstered by brisk trade in the IoT and mobile divisions.
Handset shipments reached 46.6 million units, a year-on-year growth of 45.3 per cent. Smartphone revenue was ¥47.6bn (£5.43bn), an increase of 47.5 per cent against Q3 2019.
Xiaomi is best known for its cheap-and-cheerful handsets, and these represented the bulk of the firm's volumes. According to Alain Lam, the recently appointed chief financial officer, Xiaomi has shipped merely 10 million "premium" devices in the year to date, which it defines as any phone with a retail price over €300 in the overseas market, or ¥3,000 (roughly £340) in mainland China.
The figures correlate closely with forecasts for the period produced by industry analysts. Canalys, for example, was almost [2]bang on the money with a forecast of 47.1 million shipments . This, it said at the time, put Xiaomi in third spot in the smartphone sales leader board for the first time, overtaking local rival Huawei in the process.
Still, they are impressive numbers when you take into account the smartphone market overall declined by 1 per cent in the third quarter, and the geographical split. For the first time ever, overseas markets accounted for half of all Xiaomi revenue. While much of this portion pertained to India, where Xiaomi has strong foothold, a major driver of expansion was Western Europe, where shipments grew 107.3 per cent year-on-year for a region-wide market share of 13.3 per cent.
Spain was among the first European markets targeted by Xiaomi, where it holds the top spot with a 33.9 per cent market share. But the company also saw triple-digit growth in France, Germany, and Italy.
According to Lam, Xiaomi plans to invest more in Europe by continuing to build its carrier channel. This is move away from Xiaomi's historical strategy, which focused on online-only sales to customers.
Evidence suggests this switch in routes-to-market is beginning to bear fruit, with network shipments up 200 per cent year-on-year during the first nine months of 2020, allowing Xiaomi to swallow a carrier market share of 4.6 per cent.
In terms of the other areas of tech at Xiaomi, the IoT and lifestyle products division grew to 16.1 per cent to ¥1.8bn (£205m) and Internet Services – games, web advertising, etc. – was up 8.7 per cent to ¥5.8bn (£660m).
The company made a net profit ¥4.1bn (£467m). ®
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[1] https://i01.appmifile.com/webfile/globalweb/company/ir/announcement_us/RATH_20201124_e.pdf
[2] https://www.theregister.com/2020/10/30/coronavirus_rates_arent_the_only/
[3] https://whitepapers.theregister.com/
I bought a Pocophone F1 (xiaomi) couple of years ago. Cost me something like 200 quid. It had what was then a top of the range processor, decent RAM. Also bought my wife a Xiaomi, and then my daughter just a few months ago. Battery life is excellent, performance really good and nice camera too. The screen is maybe the weakest part, only in that it's not OLED, but still really crisp and brightness ok unless you're outside in bright sunlight. Back is plastic rather than glass, but for me that's a bonus because it's tougher. And they provide a free rubber case, and you really need a case on any phone anyway so the finish on the back of a phone is wasted on most users anyway.
I get how people might pay multiples of price for desktop workstations or laptops with top notch processors and loaded with RAM for intensive tasks, but I really don't see any economic argument for 1000 quid phones. I am pretty sure that there is no performance benefit that would really improve productivity for anyone on the kind of tasks you do on a phone like talking, emails and a bit of browsing.
I like Xiaomi
My daughter has a Xiaomi phone that was (is still) quite amazing for the money and their robot vacuum does a great job cleaning up the charger cables every day. Sorry, eating the cables and cleaning the floor.
Revenue is not profit
They're selling their mid-range devices at cost price and are barely eking out a profit.
Alternatively...
" It has been a difficult year for the mobile industry as economic uncertainty and widespread national lockdowns further depressed the public's appetite for handset upgrades. "
Or maybe:
"It's been a great year for the planet and poor people in the third world as vastly fewer perfectly functional phones have been chucked out for [1]dumping and [2]burning ".
The hi-tech treadmill we've got onto in the "west" doesn't just hit our pockets - it poisons people elsewhere as well. The only overall winners are the manufacturers, but some are now even [3]fouling their own nests .
[1] https://ourworld.unu.edu/en/toxic-e-waste-dumped-in-poor-nations-says-united-nations
[2] https://www.smithsonianmag.com/science-nature/burning-truth-behind-e-waste-dump-africa-180957597/
[3] https://www.niehs.nih.gov/research/programs/geh/geh_newsletter/2013/7/articles/ewaste_recycling_in_china_a_health_disaster_in_the_making.cfm