Xiaomi Rides Increase In Smartphone Demand
• The vast majority of Xiaomi’s earnings come from the sale of smartphones.
• Xiaomi’s smartphone shipments in China increased 10% in the fourth quarter.
• Xiaomi has also extended its physical store presence.
In an earnings call, Xiaomi president Wang Xiang noted, “In 2021, we encountered a really tough circumstance.”There is a geopolitical impact on supply, which is quite severe or restricted. Xiaomi’s performance, on the other hand, has demonstrated that we are a resilient company.”
According to Refinitiv data, revenue increased to CNY 85.58 billion (approximately Rs. 1,02,341 crore) in the quarter ended December 31, up from CNY 70.46 billion (about Rs. 84,259 crores) the year before and analyst forecasts of CNY 81.80 billion (roughly Rs. 97,826 crores).
Xiaomi claimed in a statement that smartphone shipments increased by 4.4 percent to 44.1 million units in the third quarter. Analyst forecasts were also exceeded as net income increased 39.6% to CNY 4.47 billion (approximately Rs. 5,345 crores).
In an earnings call, Wang stated that maintaining a consistent supply of chips was still difficult in the first quarter of 2022, but that the situation will improve by June. Smartphone revenue increased 18.4 percent to CNY 50.5 billion (approximately Rs. 60,393 crores) in the quarter ended December 31, according to the company, which obtains the vast majority of its revenue from selling mobile handsets.
Last year, Xiaomi snatched market share from Huawei in China, which had lost its smartphone momentum when the US imposed export restrictions on its suppliers. According to Canalys data, Huawei subsidiary Honor rebounded strongly in the second half of 2021, concluding the fourth quarter with a 16 percent market share in China, the same as Xiaomi.
According to Canalys, Xiaomi’s smartphone shipments in China increased 10% in the fourth quarter. Its shipments increased by 5% globally. Xiaomi has been looking for fresh prospects due to slowing device demand in China, the company’s major market.
Over the next ten years, the corporation plans to invest $10 billion (approximately Rs. 76,193 crores) in the development of electric vehicles, which it intends to bring to market by 2024. The company has also increased its semiconductor investments, launching its first gadget with its own image signal processor.
Chip investments, according to Wang, will be made in areas “directly related to user experience,” such as quick charging. Xiaomi has also increased its physical store presence in the hopes of luring more customers. Xiaomi’s sales in 2021 increased by 33.5 percent to CNY 328.3 billion (approximately Rs. 3,92,696 crore), compared to an average expert forecast of CNY 325.862 billion (roughly Rs. 3,89,720 crore).
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