Xiaomi's Dual Challenge: Electric Vehicle Momentum Meets Smartphone Delays

Xiaomi's EV division turns profitable with 40k+ SU7 orders, but smartphone delays and a 49% stock drop highlight strategic challenges as it targets 550k vehicle deliveries in 2026.

As Xiaomi celebrates its 16th anniversary, the Chinese tech conglomerate finds itself navigating a complex strategic landscape. Its global Fan Festival 2026, active in more than 50 nations, serves as both a sales platform and a showcase for its integrated ecosystem vision, which aims to converge smartphones, smart home devices, and electric vehicles.

Financial Performance and Market Position

The company's core operations demonstrate resilience. In 2025, Xiaomi maintained its position as the world's third-largest smartphone vendor, with sales reaching 165.2 million units. Within China's premium device segment, it achieved a record market share of 27.1%. Its AIoT platform now connects a substantial 1.03 billion devices globally.

However, investor sentiment has been less robust. Xiaomi's shares recently touched a 52-week low of €3.41, representing a decline of approximately 49% from the peak reached in June 2025. Market observers suggest that upcoming quarterly results will be crucial in assessing whether ambitious new targets can reverse this trend.

Electric Vehicle Division: A Story of Contrasts

Xiaomi's foray into the automotive sector is producing mixed signals. The launch of its updated SU7 model has been notably strong. CEO Lei Jun announced during a live-stream event that the vehicle, which began deliveries on March 23, has secured over 40,000 firm orders. Total deliveries for March alone surpassed the 20,000-unit mark.

Conversely, demand for the older YU7 model is normalizing. Waiting times have decreased significantly from an initial range of 33 to 56 weeks down to between 7 and 14 weeks, indicating a shrinking order backlog. Data from Goldman Sachs in March revealed weekly orders of about 4,000 units, substantially below prior peak levels.

A major product offensive is planned in response. For 2026, Xiaomi intends to introduce four to six new vehicles, including sedans, SUVs, and five- and seven-seater models across a wide price spectrum. The annual delivery target is set at 550,000 vehicles, following 411,837 deliveries in 2025 and 139,471 the year before. Notably, the auto division turned its first profit in 2025, reporting revenue of roughly €13 billion and a net profit of approximately €113 million.

Smartphone Roadmap Adjustments

On the smartphone front, a key product launch has been delayed. The company's next foldable device, initially scheduled for a May debut alongside the Xiaomi 17 Max, is now expected in early July. This shift coincides with a potential rebranding; the device may launch as the Xiaomi 17 Fold instead of the Mix Fold 5 or Fold 6, hinting at a more fundamental realignment of the product portfolio.

The coming months will be critical for Xiaomi as it attempts to balance execution in its burgeoning automotive business with maintaining momentum in its established consumer electronics divisions. The market's focus remains firmly on whether the electric vehicle segment's ambitious targets can translate into sustained financial performance and improved shareholder value.