Results Xiaomi Q3 2021: earns 8.2% more, but is below forecasts

Xiaomi has presented this Tuesday the results related to the third quarter of the year, where it has reported sales of 78,060 million yuan (12,220 million dollars and 10,860 million euros at the exchange rate), 8.2% more, although below analysts’ forecasts.

Experts expected 79.2 billion yuan (11.01 billion euros) to be reached, something that has not been possible, in part, due to the intense competition suffered by the Chinese company with national rivals, as well as by the shortage of components, as they point from Bloomberg.

For his part, net profit has decreased by 84%, something that the company attributes to changes in the valuation of its investment portfolio. Specifically, they cite an impact of 3.5 billion yuan (486 million euros) from losses in market investments.

By segment, the division related to smartphones, the most powerful of the brand, has reported 47.8 billion yuan in revenue, 0.4% more, which accounts for a slowdown caused by falling sales in China.

Where does the technology income come from: Xiaomi enters with its smartphones in just 2 quarters the same as in all of 2018

Before this quarter, Xiaomi came from a more than good situation after surpassing Apple and becoming the second mobile provider in the world, but in the last 3 months the brand’s global shipments have plummeted due to component shortages.

According Bloomberg, the supplier has registered a decrease of 4.6% in said period after a growth of more than 2 digits during the 4 previous quarters. Added to this is the rise in shipments from the apple company – by up to 21% – after the launch of the latest iPhone.

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In addition, it has also made a dent in technology the increasing pressure it is under in China following the resumption of Honor business after resuming its business with US suppliers after separating from Huawei.

The news agency explains that this brand has been expanding its network of physical stores in the region in recent months and targeting the same target of users addressed by Xiaomi.

However, the Asian giant also has its own plans to expand its offline channels, with the intention of opening more than 20,000 physical stores in China in the next 3 years to counter competition.

Xiaomi is already working on the Mi Car, the electric car that will rival the Apple Car and which the Chinese company has been thinking about for almost a decade

Despite all the problems the brand has faced in the last 3 months, analysts expect it to continue to grow and report more than 220 million terminal shipments during 2022 thanks to the expansion of the market, the recovery of the key countries and the new channel initiatives that it is carrying out.

Bloomberg points out that a stable smartphone business is key for the company to execute its plan to produce a competitive electric vehicle. The firm has already stated on other occasions that 2024 will be the year in which they plan to mass produce their first car, with a plant located in Beijing.

Shares of the Asian giant fell 1% in Hong Kong before the presentation of the results. In total, the company’s titles have lost more than a third of their value this year due to supply chain problems and coronavirus outbreaks in key markets that hampered its operations.