Xiaomi's Aggressive Buyback Fails to Halt Stock's Slide to New Low

Despite a major share repurchase, Xiaomi's stock hits a 52-week low. Investors worry over smartphone profit decline and heavy spending on electric vehicles and AI.

A massive two-day share repurchase program by Xiaomi's management has done little to arrest a steep decline in the Chinese tech giant's stock price. The company spent over 433 million Hong Kong dollars (HKD) buying back nearly 14 million of its own shares on April 9 and 10, 2026, in a bold attempt to signal confidence. Despite this intervention, the stock closed Friday at a 52-week low of €3.41, cementing a year-to-date loss of 24.10 percent.

The sell-off reflects a brutal reality check for investors, who are punishing the company for a toxic mix of pressures. While Xiaomi celebrates strategic advances in artificial intelligence (AI) and electric vehicles (EVs), its core smartphone business is faltering. A 24 percent drop in adjusted net profit for the fourth quarter, driven by rising memory chip costs, has spooked the market. Intense competition at home from rivals like Huawei and vivo is further squeezing margins in the company's foundational segment.

These operational headwinds are colliding with expensive future ambitions. Xiaomi is funneling hardware profits into scaling its loss-making automotive division. The technically upgraded SU7 model, now featuring advanced radar and Nvidia hardware, has garnered over 40,000 firm orders. Management is accelerating its European plans, recently hiring a European logistics chief, suggesting a potential move forward of the EV market entry originally slated for 2027. The company projects that revenue from its auto unit could surpass its struggling smartphone business as early as the current fiscal year 2026.

Parallel investments in AI are also significant. The recent commercial rollout of its MiMo-V2-Pro large language model, boasting over one trillion parameters, processed more than one trillion tokens on its first day. This positions Xiaomi as a direct, lower-cost challenger to US AI leaders.

Yet, these costly transformations are occurring against a harsh macroeconomic backdrop. New US tariffs on Chinese technology have weighed heavily on the sector, dragging down the broader Hong Kong Hang Seng Index. The stock's current price represents a near-halving from its peak last year, underscoring the deep skepticism overshadowing Xiaomi's strategic milestones.

The multi-million dollar buyback is a clear statement from management in the firm's intrinsic value. However, without a near-term easing of the massive capital expenditures for mobility or a meaningful recovery in smartphone profitability, fundamental investor doubt is likely to persist. The market is demanding tangible financial proof that the expensive pivot from smartphone maker to mobility provider will ultimately pay off.