- Xiaomi posts net loss of 7 billion yuan (~$1.1 billion) on overall revenue of 34.4 billion yuan for Q1 2018.
- Discarding one-off payments, Xiaomi recorded a net profit of just over 1 billion yuan (~$150 million).
- Smartphones sales are still going strong despite low margins and Xiaomi has made small gains in the smart home industry.
Ahead of a blockbuster, potentially record-breaking IPO, Xiaomi has detailed its financials to Chinese investors for the first quarter of 2018, with the company reporting a net loss of 7 billion yuan (~$1.1 billion) on overall revenue of 34.4 billion yuan.
Despite the loss, however, there were positive signs for the Chinese firm that could help secure the mooted $10-$100 billion valuation it needs to expand into other markets, including the U.S.
For starters, the 7 billion figure loss pales in comparison to the estimated 43.89 billion yuan loss posted by Xiaomi across all quarters in 2017.
More importantly, though, when you remove one-off payments from the overall picture then the Q1 2018 total is bumped up to a net profit of just over 1 billion yuan (around $150 million).
Xiaomi’s key sector is still the smartphone market where it has enjoyed rapid growth in emerging markets and more recently incredible success in Europe. Shipments increased by 88 percent compared with Q1 2017, although smartphones only represented 67.5 percent of the overall revenue — down from 70 percent a year prior, according to Bloomberg.
With further growth in Asia, Russia, Europe, and possibly the U.S. on the horizon, Xiaomi isn’t expected to move away from its low margin-high volume approach to smartphone production any time soon — especially after the launch of its modestly priced, iPhone X lookalike, the Mi 8.
Xiaomi still has a long way to go in the global smartphone picture.
It’s a different story for Xiaomi’s smart home and online services, though, with high-end products like air purifiers and scooters (yes, actual scooters), as well as mobile apps, accounting for just over 30 percent of Xiaomi’s revenue so far this year.
No matter the result of the IPO, Xiaomi still has a long way to go in the global smartphone picture. The Beijing-based company currently sits in fourth with 7.9 percent market share behind industry giants Samsung (21.7 percent), Apple (14.5 percent), and Huawei (10.9 percent).