Xiaomi's High-Stakes Autumn: A Foldable Offensive Meets a Halved Share Price

Xiaomi unveils 18 Fold and EVs, but Q2 profit drops 42.6% and EV losses persist, while shares fall 30% YTD.

The premium smartphone arena is bracing for one of its most crowded weeks in recent memory. Xiaomi kicked things off with its autumn flagship event in China on Monday evening, unveiling the 18 Fold — a device the company bills as the first inward-folding smartphone with a wide aspect ratio — while Huawei had already fired its own salvo with a new foldable earlier that same day. By midweek, Apple is set to enter the fray with its latest iPhone lineup, turning the high-end segment into a three-way battleground.

Xiaomi's timing is no accident. The event lands just three days before Apple's own autumn presentation on September 10, a deliberate attempt to capture attention with homegrown technology before the US giant takes center stage. At the heart of the 18 Fold sits the Xring O3, a ten-core processor built on TSMC's 3-nanometer process — a chip Xiaomi first previewed on August 24 via its Weibo channel. The device also pairs with LPDDR6 memory from ChangXin Memory Technologies (CXMT), a pointed commitment to Chinese component suppliers. Alongside the foldable, Xiaomi brought the Pad 9 Pro Max tablet and three new Pengcheng electric vehicles to the stage.

The market's response, however, has been muted at best. Shares hovered around €3.04 on Monday, down 2.4 percent from Friday's close of €3.11. The stock sits just above its 50-day moving average of €2.99 but remains well below the 200-day average of €3.52 — a technical picture that reflects deeper investor unease. At current levels, Xiaomi trades roughly 54 percent beneath its 52-week high of €6.54, reached on September 25, 2025, and has shed about 30 percent since the start of the year.

The Earnings Squeeze Behind the Product Gloss

The product spectacle masks a more sobering operational reality. For the second quarter of 2026, Xiaomi reported revenue of 108.9 billion renminbi with a gross margin of 19.8 percent, while adjusted net profit came in at 6.2 billion renminbi. In dollar terms, group revenue fell 6.1 percent to $16.0 billion, and net income dropped 20.3 percent to $1.4 billion. The adjusted net profit figure tells an even starker story: down 42.6 percent to $920 million, though it still edged past analyst consensus.

The core smartphone business is feeling the strain most acutely. Shipments tumbled 26 percent in the quarter to 31.2 million units, a decline that one analyst house responded to by trimming its earnings estimates for 2026 through 2028. The message is clear: intense competition and hefty development costs for chips and foldables are weighing on profitability.

The Expensive EV Bet

Nowhere is that tension more visible than in electric vehicles. The three new Pengcheng models — the N70 Pro, N70 Max, and N90 Max — are extended-range EVs that pair battery power with a combustion engine for added range. Pricing is ambitious: the N90 Max is expected to cost around $44,230, positioning Xiaomi firmly in the upper tier of China's SUV market.

The segment's financials tell a cautionary tale. EV revenue climbed 17.1 percent to $3.7 billion in the second quarter, but the division posted an operating loss of $385 million. Growth, in other words, is expensive — and the capital-intensive nature of three new models suggests that pattern will persist. Adding to the headache, reports indicate that several million vehicles from both Tesla and Xiaomi are affected by recalls in China over faulty electronic door handles, a fresh risk for a business still finding its footing.

Supply Chain Shadows and Legal Wrinkles

Xiaomi's supplier relationships carry their own geopolitical baggage. CXMT, the memory chip provider for the 18 Fold, is fighting its inclusion on a Pentagon list, according to Reuters. The legal wrangling echoes Xiaomi's own experience in 2021, when it managed to extricate itself from a US lawsuit. Such friction remains a lingering risk for the supply chain — and, by extension, for Xiaomi's product roadmap.

Spending Big to Stay Relevant

None of this is slowing Xiaomi's investment appetite. Last week, the company announced global research spending of €24 billion between 2026 and 2030, targeting artificial intelligence, operating systems, semiconductors, intelligent vehicles, and robotics. Late August also brought price increases across several models — the Xiaomi 17T Pro, for instance, jumped from roughly $754 to $879 in Japan — a direct response to rising memory and component costs.

The company's broader ambitions extend beyond handsets. At Berlin's IFA trade fair, Xiaomi showcased more than 380 products under its "Human × Car × Home" strategy, and reports suggest the company is eyeing a German market entry for its EVs starting in 2027, though no binding commitment has been made. Back in China, demand to tour Xiaomi's Beijing EV factory has grown so intense that visits are now allocated through an online lottery with non-transferable tickets.

For investors, the picture is genuinely mixed. Technological milestones and bold investment plans collide with shrinking margins in the core business and persistent losses in vehicles. Monday's product barrage offered a glimpse of Xiaomi's ambitions — but whether the company can bridge the gap between its engineering prowess and its profit engine remains the question that will define the stock's next chapter.