Xiaomi Prepares European Beachhead and Battery Factory While Investors Await Q1 Margins

Xiaomi's EV deliveries hit 117,558 units but full-year target remains steep. Stock at €3.37, down 40% YoY, awaits Q1 earnings on May 26 for margin clarity.

The chasm between Xiaomi’s operating momentum and its stock price has rarely yawned wider. The Chinese electronics and electric vehicle maker is ramping up EV deliveries, readying a European launch, and building its own battery plant — yet its shares closed at €3.37 on Friday, down nearly 25% since the turn of the year and more than 40% over the past twelve months. All eyes now turn to the company’s first-quarter earnings report, due on 26 May, which will test whether the business can balance breakneck expansion with sustainable profitability.

EV output hits new highs but the target remains steep

Xiaomi’s electric vehicle factory outside Beijing is running flat out. In April the group handed over 36,702 cars, of which 26,826 were the SU7 sedan. That brought cumulative deliveries since January to 117,558 units — a solid start, but still short of the pace needed to meet the full-year goal of 550,000 vehicles. To hit that number, Xiaomi would need to average roughly 55,000 units per month from May through December. Its best month so far was 50,000 deliveries, underlining the ambition of the target.

The company is taking steps to bring more of the supply chain in-house. It has created Beijing Xiaomi Jingxu Technology, a subsidiary that plans to build a battery plant with an annual capacity of 15 gigawatt-hours. Batteries represent one of the biggest cost components in an EV, and vertical integration could reduce reliance on dominant suppliers CATL and FinDreams Battery (a BYD affiliate), which together accounted for 54.4% of China’s traction battery market in the first quarter.

Q1 earnings: margins and the money question

On 26 May the board will review and approve unaudited first-quarter results. Analyst consensus forecasts revenue of between 99.07 billion and 101.06 billion renminbi. JPMorgan expects adjusted net profit to beat the consensus, but that alone may not soothe the market’s main anxiety: the profitability of Xiaomi’s smartphone business, which remains the primary cash engine funding the capital-intensive EV ramp-up.

The stock’s slide reflects that tension. At Friday’s close of €3.37, the shares were trading at a 3.46% daily loss and well below the 200-day moving average of €4.50. The 52-week high is now nearly 50% out of reach. Xiaomi has tried to counter the pressure with buybacks: as of 24 April it had repurchased shares worth HK$7.4 billion in 2025, surpassing the HK$6.3 billion it spent on buybacks in the whole of last year.

Smartphone lineup and European ambitions

Even as investors fret about margins, Xiaomi is pushing ahead with its device business. In China it has begun teasing the 17 Max flagship, featuring a large battery and a high-resolution Leica camera. Later this month the company plans to launch the 17T and 17T Pro globally, with prices starting at €749.

The bigger strategic bet, however, remains the expansion of the electric vehicle division into Europe. Xiaomi has reorganised its leadership for the push, naming Yu Liguo to head the overseas preparation group. The plan is to enter the German market in the second half of 2027, followed by right-hand-drive markets such as Britain in the first half of 2028. A research and development centre already operates in Munich, staffed by former BMW engineers Rudolf Dittrich (site head) and Claus-Dieter Groll (vehicle dynamics).

What comes next

The 26 May earnings release will be followed by a general meeting in Beijing a week later, where shareholders will vote on mandates for future share issuance and additional buybacks. For now, the market is demanding evidence that Xiaomi can deliver growth in both volume and margins without one cannibalising the other. The battery plant, the European beachhead, and the steady rise in EV output all point in the right direction — but the share price suggests investors are waiting for a profit proof that has yet to arrive.