Xiaomi’s Two-Speed Reality: Record Orders in EVs, a Rout in Shares

Xiaomi's EV division sees record orders and European expansion plans, but a 29% stock slump and chip cost surge in its core smartphone business weigh on investor sentiment.

The Chinese technology group Xiaomi is living a tale of two markets. Its electric vehicle division is swamped with orders and pushing into Europe, while its stock has just cratered to a fresh 52-week low, leaving investors to question when operational momentum will translate into share price performance.

On Thursday, Xiaomi’s shares touched EUR 3.20, a new 12-month trough, extending the year-to-date decline to roughly 29%. The sell-off has persisted despite a flurry of bullish corporate activity, including a massive share buyback programme that has so far failed to arrest the slide. By late April, the company had poured billions into repurchasing its own equity, but the market remains unmoved.

Georgia as a Gateway to Europe

Management is now looking to the Caucasus for a strategic edge. The Georgian government has formally invited Xiaomi to establish a local electric vehicle assembly plant, alongside a dedicated logistics hub for its automotive division. The appeal is clear: under certain conditions, goods exported from Georgia can enter the European Union tariff-free. A local final-assembly operation would dramatically strengthen Xiaomi’s competitive position in Europe, and the company is currently evaluating the regulatory and economic framework.

This push comes alongside a concrete timeline for the continent. Xiaomi plans to begin selling its EVs in Europe in the second half of 2027. A development centre in Munich, already staffed by over 100 employees, is building the operational groundwork for that launch.

Surging Orders, Slowing Deliveries

The operational picture is more nuanced. In March 2026, Xiaomi delivered more than 20,000 vehicles, driven by the revamped version of its SU7 electric saloon. Since the updated model went on sale at the end of March, the company has handed over 7,000 units. Firm orders for the new SU7 have now surpassed 40,000 vehicles, and the group’s ambitious annual target stands at over half a million deliveries.

Yet the first quarter as a whole tells a different story. Xiaomi delivered roughly 79,000 vehicles in Q1 2026, a notable drop from the strong final quarter of 2025. To hit its half-million goal, production will need to accelerate significantly in the months ahead. The company is investing heavily to make that happen, channelling billions into research and development this year, with a focus on AI-driven manufacturing and green technologies. It is also shifting its logistics from air freight to sea and rail transport to cut CO2 emissions and reduce long-term shipping costs.

Chip Cost Shock Hits the Core Business

While the EV division grabs headlines, the core smartphone business is under severe pressure. Memory chip prices surged by as much as 90% in the first quarter, crushing gross profit in the segment by more than 40%. Shipments fell by nearly a fifth to 33.8 million units. Management expects the global smartphone market to shrink in 2026 and is relying on higher selling prices to offset the volume decline.

Xiaomi is betting on artificial intelligence to open new revenue streams. Its in-house foundational AI model has performed well in initial tests, and around 35% of users are already paying for expanded token plans. The company sees subscriptions and premium product pricing as the route to monetising its AI capabilities.

Key Dates on the Horizon

The market will get its next major data point on 26 May, when the board presents the final first-quarter results. Those numbers will need to demonstrate that the company’s expensive growth strategy is generating real profitability. On 2 June, the annual general meeting will see shareholders vote on proposed changes to the company’s articles of association and new rules governing virtual meetings. Until then, the disconnect between Xiaomi’s operational ambition and its stock market performance looks set to remain the defining theme.