China's Xiaomi reported higher revenue for the second quarter, revealing for the first time its auto business unit's contribution of 6.2 billion yuan ($869.2 million). For the three months ending in June, Xiaomi's revenue rose up to 32 per cent to 88.9 billion yuan, beating the 85.8 billion yuan estimated by analysts, according to LSEG.
The company first announced its entry into the EV business in 2021 as a diversification from its core smartphone operations. Xiaomi started shipping its SU7 electric vehicles in early April after announcing it would price its SU7 models competitively against Tesla's offerings.
It delivered 27,307 EVs in the second quarter, generating 6.2 billion yuan in revenue. This is its first financial report to include details of its auto business segment. In a media call following the earnings report, Xiaomi's President Lu Weibing said he is "confident" the company will reach its target of delivering 120,000 electric vehicles by year-end.
Since June, Xiaomi has applied double-shift measures to ensure monthly deliveries exceed 10,000 units. Xiaomi's auto business is still operating at a loss. The unit reported an adjusted loss of 1.8 billion yuan for the quarter, with a gross profit margin of 15.4 per cent. Lu said that as deliveries ramp up, the unit's profitability is expected to improve over time. The global smartphone market has shown signs of a recovery since late last year after a prolonged slow period.
Xiaomi's global smartphone shipments rose 27.4 per cent to 42.3 million units in the second quarter, helping the company capture a 14.8 per cent market share and placing it in the No. 3 position, according to industry research firm IDC. Xiaomi's largest market for its smartphone business in china , its shipments rose 16.5 per cent, according to IDC.Adjusted net income was 6.18 billion yuan, above the 4.8 billion yuan estimated by analysts.