Xiaomi confirms US reprieve as revenue rockets

It’s a good day for China’s Xiaomi, which has confirmed reports that it is no longer blacklisted in the US and shared first-quarter numbers that show pretty stellar growth.

“Xiaomi is pleased to announce that on May 25, 2021 at 4:09 pm (Eastern Standard Time), the U.S. District Court for the District of Columbia issued a final order vacating the U.S. Department of Defence’s designation of the Company as a ‘Communist Chinese Military Company’ (CCMC),” the firm said, in a – rather precise – statement. Essentially, the US courts overturned former president Donald Trump’s blacklisting of Xiaomi back in March, and now, as rumoured earlier this week, we have a final order on the matter.

Xiaomi had contested its inclusion on the list of enterprises with links to the Chinese military, alongside the likes of Huawei, on the grounds that it is a listed and therefore much more transparent company. It’s hard to argue with that, and clearly the courts agreed.

“In vacating the designation, the court formally lifted all restrictions on U.S. persons’ ability to purchase or hold securities of the Company,” Xiaomi added.

The vendor has more to celebrate than just the lifting of restrictions in the US though. Its first-quarter results show that business is booming.

In Q1 “both our total revenue and adjusted net profit reached record highs,” it said. Turnover was up by almost 55% compared with the first quarter of last year to 76.9 billion yuan (US$12 billion), while adjusted net profit grew by 164% to CNY6.1 billion ($957 million).

The numbers were driven by Xiaomi’s smartphone business, which accounted for two thirds of revenue and grew by almost 70%. Global smartphone shipments in Q1 came in at 49.4 million units, generating a gross profit margin of 12.9%. Citing figures from Canalys, Xiaomi said it remains the world’s third biggest smartphone maker in terms of shipments, with a Q1 market share of 14.1%.

The vendor also talked up progress at its non-smartphone businesses, recording strong growth in IoT, lifestyle and smart TV products.

“Besides the solid growth in our existing business lines, we are also continuing to explore new opportunities and broadening our business horizon,” Xiaomi said. “In March 2021, we unveiled our new branding identity and also announced our official foray into the smart electric vehicle business, setting the course for an exciting journey that will ensure a bright future for the company in the coming decade.”

With the highways in the US now open once again to Xiaomi, the journey ahead could be more lucrative than it might otherwise have been.