Xiaomi's upcoming SUV model is anticipated to bolster the financial standing of Xiaomi's automotive division.
Let's Talk About That Xiaomi EV Thing
Why should you care: Chinese tech powerhouse Xiaomi is diving headfirst into the electric vehicle (EV) market, aiming to swim profitably with their latest model.
- Lei Jun, the brain behind Xiaomi Corp., anticipates his EV business to be swimming in profits by the second half of this year. He made this bold prediction during an investor event, edging us on without disclosing the exact species of that profit. Xiaomi's shares splashed up by more than three percent in Hong Kong, and the Wall Street crowd doing the happy dance!
The SU7 Swimming Pool: Xiaomi has been making a big splash with their SU7 sedan since its debut a year ago, marking a significant decrease in losses in the sedan segment recently.
- Last month, they unveiled their plans for the first SUV - the YU7 - due to make a splash in July. With their strong sales record, Xiaomi might continue raking in the cash with a potential 37% increase in the second quarter, predict Bloomberg analysts Teven Tseng and Sean Chen.
But wait,there's more: Bloomberg analysts haven't spilled the beans on specific timelines for Xiaomi's EV profitability or SUV models alone. However, the antsy lunar new year of profitability is expected to be Q3 2025, according to Xiaomi themselves. This is quite a milestone, given that the EV division is currently nursing losses despite contributing substantial revenue.
For Q1 2025, the new initiatives, mainly EVs, brought in nearly 18.1 billion yuan but still left an empty wallet of 500 million yuan. The leadership explains these losses are part of the growing pains involved in scaling up automotive operations, as they prepare to plunge deeper into the waters of the automotive industry.
As of now, there's not a peep from Bloomberg's analysts about the timeline of profits specifically for the SUV models. The only ripples in the water come from Xiaomi's reports and earnings calls.
- The anticipated profits from Xiaomi's EV business are expected to significantly impact Lei Jun's lifestyle, as he plans for profitability by the second half of this year.
- To expand their offerings, Xiami is set to launch their first SUV – the YU7 – in July, with analysts predicting a potential 37% increase in profits for the second quarter due to strong sales.
- With electric vehicles being a key focus, Xiaomi aims to achieve profitability in Q3 2025, as they continue to invest in technology and gadgets, such as electric vehicles, to complement their growing lineup.
