Xiaomi's Multifront Strategy Falls Flat as Stock Sinks to 52-Week Low on EV Losses and Profit Warning

Xiaomi shares tumble to €2.69 amid 40% YTD decline; EV division loses $5,600 per vehicle, deliveries fall short of 550K target, and new EREV models face market headwinds.

Xiaomi's stock has tumbled to a fresh 52-week low of €2.71, now changing hands at around €2.69, as a barrage of corporate initiatives — from a new AI assistant and a record buyback to regulatory approval for an extended-range electric vehicle sub-brand — has done little to reassure investors. The shares have shed roughly 40% since the start of the year, and the relative strength index has slumped to deeply oversold territory near 25, signalling that the selling pressure remains intense.

The root cause lies in the company's electric vehicle division, which posted an operating loss of 3.1 billion yuan in the first quarter. That translates to a loss of approximately $5,600 per vehicle delivered. A model changeover for the SU7 has squeezed margins severely, with vice-president Song Gang describing them as "extremely thin" and stressing that survival depends on supply-chain efficiency. Despite strong demand in absolute terms, delivery volumes are falling short of the pace needed to hit the annual target of 550,000 units.

In the first five months of 2026, Xiaomi delivered 150,317 EVs — growth of 13.5% year on year, but well below the 34% pace required to meet the year-end goal. May deliveries came in at 32,759 units, up 17% from the same month last year but down 10.7% from April. The gap between aspiration and reality is widening.

The company is counting on a raft of new models to close that gap. On June 11, Chinese regulators approved production of extended-range electric vehicles under the new sub-brand Skynomad, though Xiaomi has not officially confirmed the name or launch timeline. The first model will be a large SUV stretching more than 5.3 metres, equipped with a 1.5-litre range extender and a combined range of around 1,500 kilometres. Priced at roughly 200,000 yuan, it undercuts comparable offerings from Li Auto and Aito, which start at 250,000 yuan. However, the broader EREV market is wobbling: wholesale volumes slumped almost 25% in May, marking the sharpest monthly decline in five years, and even market leader Li Auto saw its May deliveries fall 18% year on year to 33,350 units.

Xiaomi has four new models planned for 2026: a revamped SU7 with a 902-kilometre range, an SU7 Executive Edition, and two EREV SUVs in five- and seven-seat configurations. President Lu Weibing also flagged a model built on an entirely new platform for the second half. Getting two EREV models to market before year-end is an aggressive timetable — and arguably the only route left to salvage the delivery target.

Beyond EVs, Xiaomi's core smartphone business is also under pressure. Customers are paying record prices for devices, but the gross margin has been squeezed to just 10.1% as expensive memory chips eat into profitability. Goldman Sachs expects adjusted net profit to plunge 50% in the second quarter to 5.4 billion yuan, prompting the bank to lower its full-year forecast even as it maintains a Hong Kong dollar 40 price target. Jefferies was more bearish, downgrading the stock to Underperform with a target of HK$25.49, equivalent to around €2.82.

Management has tried to counter the sell-off with capital measures. On Tuesday, the company bought back shares worth over HK$100 million as part of a HK$20 billion repurchase programme, but the impact evaporated almost instantly. A new cloud-based AI assistant, MiMo Claw, launched on June 16, claims to execute over 1,000 tool calls per session while consuming up to 60% fewer tokens than rival offerings, and offers free four-hour daily trials. Yet the market paid little attention.

The next major test comes on August 26, when Xiaomi reports second-quarter earnings. By then, delivery numbers for June and July will have shown whether the production offensive is gaining traction — or whether the gap to 550,000 units has become insurmountable.