Xiaomi's Redmi K90 Ultra and 600,000 EV Milestone Can't Lift Stock as Memory Costs and Internal Rivalry Bite

Xiaomi hits 600k EV deliveries and meets annual target, but stock plunges 44% YTD as memory chip shortage crushes smartphone margins and technical indicators show oversold conditions.

Xiaomi is churning out operational milestones at a rapid clip—more than 600,000 electric vehicles delivered since launch, a new Redmi gaming smartphone hitting the Chinese market, and billions earmarked for R&D. Yet the stock continues to languish near its lowest levels in a year. The shares changed hands at around €2.46 in recent sessions, clawing back to €2.49 on Wednesday, but that still represents a staggering 44.55% year-to-date decline. Technical indicators underscore the severity of the sell-off: the relative strength index has slipped to roughly 20, with the most recent reading at 23.8—both deep in oversold territory.

The bright spot is Xiaomi's electric-vehicle division. In June the company delivered over 30,000 units, marking the third consecutive month above that threshold. First-half 2026 deliveries totaled more than 180,000 vehicles, pushing cumulative sales past 600,000 since the EV unit's debut in April 2024. The annual target of 550,000 units has already been met, and the burden now shifts to maintaining momentum. The SU7 sedan and the YU7 SUV—the latter a direct rival to Tesla's Model Y—are the primary growth engines.

Behind the EV success, however, Xiaomi's core smartphone business is under severe pressure. A global shortage of memory chips, driven by surging demand for AI servers, has sent component prices soaring. That hits Xiaomi especially hard because roughly 62% of its devices sell for under $200, where margins are razor-thin. The company has responded by slashing its smartphone shipment targets by as much as 30%. The resulting earnings squeeze is a stark counterpoint to the EV unit's growth.

Meanwhile, Xiaomi has rolled out the Redmi K90 Ultra in China, priced at roughly $440 and aimed squarely at mobile esports enthusiasts with dedicated graphics chips. An active air-cooling system drops the temperature by ten degrees Celsius in 100 seconds, ensuring stable frame rates during intense gaming sessions. The device uses an older Snapdragon processor, but a parallel Supreme Edition model features a newer chip—yet shares the same design and cooling architecture. That overlap means Xiaomi is effectively competing against itself, cannibalising its own customer base.

On the technical side, the stock has been in a downtrend since October 2025. The current price sits nearly 38% below its 200-day moving average, and the 50-day line at €3.10 provides a key resistance level. A share buyback program of up to 20 billion Hong Kong dollars, launched in June, has done little to stem the selling pressure. Short sellers still hold about 9% of the free float, reflecting deep market skepticism.

Xiaomi is betting big on the future. It plans to invest €7.4 billion in research and development between 2026 and 2028, with a strong focus on artificial intelligence. The concept of "Human × Car × Home" aims to seamlessly integrate smartphones, vehicles, and smart-home devices, and Europe is a central piece of that puzzle. The company will make its first major European trade-show appearance at IFA in Berlin this September. The crucial question: Can the scale economies from EV production offset the escalating memory-chip costs that are eating into smartphone margins? Xiaomi's next quarterly results are expected to provide the answer.