Xiaomi Fights Stock Slide with $26M Buyback and Extended-Range EV Push

Xiaomi's stock hits a 2026 low amid smartphone contraction and auto losses, prompting a HK$201.9M buyback and a strategic shift to hybrid EVs with regulatory approval.

Xiaomi is fighting on two fronts. Its smartphone core is contracting, and its fledgling auto business is burning cash. As the stock touched a fresh 2026 low of HK$2.82 on Thursday, management responded with a HK$201.9 million share repurchase — buying back 7.8 million shares in a single day. The move is part of a broader buyback programme that authorises up to HK$20 billion in the coming months.

The stock has now lost roughly 36% since January. Earlier in the week it had already plumbed a 52-week trough of €2.87 on the Xetra exchange, more than 57% below the June 2025 peak. The Relative Strength Index sits at 29.8 — deep in oversold territory — and the shares trade about 32% below their 200-day moving average. This is not a fleeting dip; it reflects a sustained reassessment of the company’s prospects.

A Strategic Pivot into Hybrid Territory

Just a day before the buyback, the Chinese Ministry of Industry and Information Technology handed Xiaomi a critical regulatory nod: approval to produce extended-range electric vehicles (EREVs). Until now, the company has built only pure battery-electric cars. The first EREV model, codenamed “Kunlun N3,” is a family SUV over five metres long, targeting the booming segment where range anxiety remains a real barrier. It could debut under a new sub-brand called Skynomad, deliberately separated from the sportier SU7 and YU7 identity.

Xiaomi plans four new models for 2026: a refreshed SU7 with 902 km of range, an SU7 Executive Edition, and two EREV SUVs in five- and seven-seat configurations. The pure-electric range of the Skynomad model is said to reach up to 500 km. The timetable is aggressive — two EREV launches before year-end — but volume is what the company desperately needs to hit its 2026 delivery target of 550,000 vehicles.

The Numbers behind the Pressure

Reality is sobering. In the first five months of 2026, Xiaomi delivered roughly 140,000 to 150,000 units — well short of the pace required. The YU7 saw deliveries slide from nearly 38,000 in January to just 9,900 in April, as the launch hype faded. Meanwhile, the auto division lost about US$5,600 per vehicle in the first quarter, contributing to an overall operating loss of 3.1 billion yuan at the new business.

The broader financial picture is equally strained. First-quarter net profit plunged 57% as revenue shrank to 99.1 billion yuan. Global smartphone shipments fell 19.2% year-on-year, though the average selling price rose to a record 1,310 yuan, partly cushioning the blow. Soaring memory chip costs and a sluggish consumer environment are squeezing margins across the board.

A Market That Is Cooling Fast

The EREV segment itself is not offering a tailwind. Wholesale sales of extended-range models in China dropped almost 25% in May, the steepest monthly decline in five years, and their market share slipped to 7.0%. Only three models now sell more than 5,000 units a month. Even Li Auto, the segment leader, saw its flagship L9 deliveries fall 74% in the first four months of 2026 compared with a year earlier.

Xiaomi is therefore entering a market that is itself under pressure. The Skynomad brand signals a deliberate effort to protect the sporty-tech identity of the SU7/YU7 line while targeting families. It makes strategic sense, but it demands time and capital — both of which are in short supply.

President Lu Weibing confirmed on the Q1 earnings call that a completely new platform will underpin a model arriving in the second half of 2026, with multiple derivatives. For now, the buyback is the most immediate tool to stabilise the stock above its lows. Whether the EREV gambit turns the tide will become clear only when the full-year 2026 results are tallied.