Profits Plunge v Privacy Displays: Xiaomi's Conflicting Signals at a 52-Week Low

Xiaomi shares hit €3.08 low as Q1 revenue drops 10.9% and net income collapses 56.5%; a HK$20B buyback and unconfirmed HyperOS privacy feature fail to lift sentiment.

A single software rumour, an ambitious buyback and a brutal profit slump are converging on Xiaomi's stock price, which now sits frozen at its 52-week low of €3.08 — down 47% from a year ago. The market has a decided verdict on the company's recent performance, leaving even a HK$20 billion share repurchase programme looking like an insufficient balm.

Q1 financials tell the grim story

Xiaomi's numbers for the first quarter of 2026 leave little room for interpretation. Revenue fell 10.9% to ¥99.14 billion. Net income collapsed by 56.5% to ¥4.7 billion, while adjusted net income dropped 43.1% to ¥6.07 billion. The smartphone core shipped 33.8 million units, a 19.2% year-on-year decline, and the IoT segment saw revenues shrink 23.7%. Even the EV business, often cited as the next growth engine, delivered 80,856 vehicles — a steep 44.2% drop from the prior quarter.

Against this deteriorating backdrop, the company unveiled plans to repurchase up to 20 billion Hong Kong dollars (around €2.36 billion) of its own B-class shares over the next twelve months, running until the 2027 annual general meeting. It isn't a new strategy: Xiaomi has already bought back roughly 399.6 million shares for a total of HK$14.6 billion under existing authorisations, with more than HK$8 billion of that activity concentrated since the start of 2026.

A software whisper meets hardware rollout

What might distract from the financial pain is a feature that hasn't even been officially confirmed. Tipster Yogesh Brar has suggested Xiaomi is exploring a privacy display function — possibly for HyperOS 4, an update due "later this year" according to Android Central. The obvious reference point is Samsung, which debuted a hardware-based privacy screen at the Galaxy S26 event in February, using different pixel types to control light emission and eliminate the need for a physical privacy filter. A software-based approach, if Xiaomi pursues it, would face technical constraints compared to Samsung's hardware solution, though the real-world gap remains unclear.

The timing of the rumour coincides neatly with confirmed product news. Leica confirmed on 28 May the new 17T series — the Xiaomi 17T and 17T Pro — featuring a jointly developed camera system with Leica Summilux optics and a triple array of main, 5x telephoto and ultrawide lenses. A privacy display feature would complement that premium positioning with a software differentiator, carrying no significant hardware cost.

Between the lines, the relevance for the stock isn't about immediate revenue. It's about whether Xiaomi can turn HyperOS into a credible platform for privacy and AI capabilities, giving the Android skin a selling point beyond specs. Android Central has linked the speculation specifically to HyperOS 4 and Android 17, suggesting the feature would sit at the system level rather than as a standalone app.

AI spending and European ambitions

The company isn't scaling back its strategic bets, even as profit shrinks. At least ¥16 billion is earmarked for artificial intelligence in 2026, with total AI spending across three years exceeding ¥60 billion. In the automotive division, preparations are underway for a European launch: the SU7 model is currently undergoing test drives in France, with a formal market entry pencilled in for 2027. The YU7 SUV carries a base price of ¥233,500.

What investors are watching

Technically, the stock is flashing contradictory signals. The relative strength index sits at 76.8 — technically overbought territory — despite a year-to-date loss of over 31% and a share price nearly 30% below its 200-day moving average. That gulf underscores the depth of the sell-off, even by the RSI's own measure.

For the privacy display speculation to move the needle, three things need to happen: an official confirmation from Xiaomi, clarity on which devices will receive the update, and evidence that a software-based solution can hold its own against Samsung's hardware approach in daily use. Until HyperOS 4 provides concrete details, the feature remains a possible building block of a strategy — one that gives investors something to watch, but nothing to trade on.