Xiaomi still growing as Christmas spending sprees approach

Chinese smartphone vendor Xiaomi has reported another quarter of year-on-year growth, and while it might not be as aggressive as previous quarters, the Holiday season is upon us.

The Christmas period might be profitable time of year for many, but Xiaomi might have more reason to cheer than many. 5G networks are being switched-on, and its smartphones are adorning the shelves. Huawei might be stealing market share in the Chinese domestic market, but Xiaomi has a significant advantage in the international markets; it doesn’t have a White House propaganda campaign of hate to counter.

Revenues over the last three months accounted for approximately $7.64 billion, a year-on-year increase of 5.5%. This might be down on previous quarters, though it always worth bearing in mind the company is still growing, thanks mainly to diversification. Xiaomi is primarily known as a smartphone manufacturer, but the team is sweating the brand into numerous different market segments.

That said, the smartphone business still accounts for the lion’s share of revenues.

Q3 2019 Market share statistics courtesy of Canalys

The on-going US aggression has had two very contradictory impacts on the Huawei business, which are having contradictory impacts on Xiaomi. In Europe, Huawei devices are becoming less attractive to the consumer, which benefits Xiaomi sales, but there seems to be a doubling-down of efforts in China, which is eroding Xiaomi market share.

Revenues for the Xiaomi smartphone business were recorded at roughly $4.6 billion, down 7.8% year-on-year, though in shipping 32.1 million units (down 3%) across the period it is sat in fourth position for market share rankings, with 9.2%.

The next financial earnings from Xiaomi will certainly be more telling on the success of the Xiaomi smartphone business, as this three-month period will include the Christmas spending sprees; a solid performance from Xiaomi could see the brand be cemented as a mainstay in the Western markets. However, it will have to fund some aggressive marketing campaigns if it is to reverse the year-on-year shipments decline for this period.

Ultimately, the Xiaomi smartphone business is not in a bad position, though when you look at the wider portfolio there are some ambitious plans underway.

Alongside the smartphones and laptops, Xiaomi has an IOT business which incorporates the team’s virtual assistant, it has now sold 213 million units to date, while there are also various different smart home appliances. Xiaomi’s TV shipments in mainland China during the period led the market, while it also sells air conditioners, refrigerators and washing machines.

Outside the hardware segments of the technology world, Xiaomi is also nurturing an Internet services business. This unit includes advertising and gaming from mainland China smartphones, as well smart TV and Mi Box subscriptions, bringing in approximately $750 million for the quarter.

The smartphone business is the core business for Xiaomi, but the team is doing a very good job at sweating the brand in associated hardware and software segments. This is a Chinese company which is flying under the White House’s radar, but it does seem to be making the right moves.