Xiaomi posted better-than-expected revenue growth after the smartphone market showed signs of life during the holiday quarter, spurring hopes of an end to a years-long electronics slump, reports the South China Morning Post. The Beijing-based firm reported an 11% rise in sales to RMB 73.2 billion ($10.2 billion) in the December quarter, versus the average analysts’ estimate of RMB 72.5 billion. Net income rose 50% to RMB 4.7 billion, also beating projections.
The results are a welcome boost for Xiaomi as co-founder Lei Jun prepares to launch his biggest bet in years, a multibillion-dollar effort to break into a Chinese electric vehicle (EV) market dominated by Tesla and BYD. Xiaomi is slated to sell its first EV models next week, more than two years after billionaire Lei Jun announced what he has called his final major endeavour.
The EV business could drive Xiaomi’s revenue 4% higher this year as its maiden SU7 model is likely to sell for RMB 220,000 to RMB 260,000, similar to Tesla’s Model 3, according to Bloomberg Intelligence analysts.