Xiaomi's Two-Front Battle: A Handset Slide and an EV Lineup Pushing Beyond Its Comfort Zone

Xiaomi faces a defining stretch with new smartphones and SUVs, but Q2 shipments fell 26% and shares are down 50% from peak. EV target looks tough.

Xiaomi is entering a defining stretch of 2026 with a flurry of product launches and a share price that has been cut in half from its peak. The Chinese tech giant is betting that fresh hardware — from a new flagship smartphone series to a pair of standalone SUVs — can arrest the slide in its core business, even as investors wait for the next set of quarterly results to gauge whether the strategy is working.

A smartphone offensive meets a brutal market reality

The company kicks off the week by unveiling its Redmi K100 series in China, headlined by the Redmi K100 Pro Max. Leaked specifications point to a 200-megapixel main camera, a Snapdragon 8 Elite Gen 5 chipset, a 6.9-inch display with a 185 Hz refresh rate, and a 9,070 mAh battery. In parallel, the budget-oriented Redmi 17 has surfaced unannounced at European retailers, with German listings showing a price of around €219.

The timing is no accident. Fresh data from market researcher Omdia shows just how much ground Xiaomi has lost in the smartphone segment. Global handset shipments contracted 6 percent in the second quarter of 2026, but Xiaomi fared far worse: deliveries fell 26 percent year-on-year to 31.2 million units. Rivals moved in the opposite direction, with Samsung expanding shipments by 5 percent and Apple surging 23 percent. Xiaomi effectively ceded market share to both competitors simultaneously.

The stock has absorbed the damage. Xiaomi shares are down roughly 30 percent since the start of the year, and sit more than 50 percent below their 52-week high of €6.54, reached in late September 2025. The most recent close came in at €3.04, a 2.13 percent gain on the day — a modest bounce that followed a 7.47 percent jump to €3.22 when CEO Lei Jun announced the new SUV lineup on July 27.

EV momentum builds, but the annual target looks out of reach

That SUV announcement marks a notable strategic shift. Lei Jun unveiled two new models — the seven-seat SkyNomad N90 Max and the five-seat SkyNomad N70 Max — that form a distinct product line separate from the existing YU7 series. The move signals Xiaomi's intent to branch into additional vehicle segments rather than rely on a single platform.

The EV division has been the brighter spot in the company's operations. Xiaomi EV delivered more than 30,000 vehicles for the fourth consecutive month in July, spanning the SU7 and YU7 models, indicating production has stabilized at a healthy level. Yet the cumulative tally tells a different story: roughly 220,000 vehicles were delivered in the first seven months of the year, barely 40 percent of the 550,000-unit annual target. Reaching that goal would require monthly deliveries to more than double to over 60,000 vehicles in the second half — a stretch given current production capacity.

Financial pressures mount ahead of the August 18 report

The next major catalyst arrives on August 18, when Xiaomi reports second-quarter earnings. Consensus estimates put revenue at approximately 110.76 billion yuan. Analysts will be watching two areas closely: margin trends in the EV segment and early details on HyperOS 4, the company's next-generation operating system, which has reportedly entered its beta phase.

The first quarter offered a sobering preview. Revenue came in at 99.142 billion yuan, down 10.9 percent year-on-year. Adjusted net profit fell 43.1 percent to 6.07 billion yuan, while GAAP net profit dropped 57 percent to 4.72 billion yuan. The smartphone division, traditionally the company's backbone, saw revenue decline 12.5 percent to 44.273 billion yuan. The IoT platform, however, continued to expand, reaching 1.119 billion connected devices — evidence that the ecosystem keeps growing even as profitability in the core business weakens.

A semiconductor windfall and a homegrown chip push

Xiaomi also benefited late last month from an investment payday: CXMT, the Chinese memory chip maker in which Xiaomi holds a stake, made its stock market debut. The position fits a broader strategy of deepening ties across China's semiconductor and supply chain landscape.

That strategy extends to in-house development. Lei Jun pledged in early January to pursue a "grand assembly" of proprietary chips, an operating system, and AI systems this year, aiming to reduce dependence on Qualcomm and Google while tightening ecosystem integration. The weak quarterly margins are likely to sharpen the urgency of those efforts, as vertical integration could eventually ease cost pressures.

Buybacks and chart levels

Management has also deployed capital to support the stock. In January, Xiaomi arranged an automated share repurchase program worth HK$2.5 billion (around €295 million) with an independent broker. Running since January 23, the program continues until the 2026 annual general meeting or until the agreed amount is reached, and carries an exemption from the Hong Kong exchange.

On the technical side, the 100-day moving average at €3.17 remains a key resistance level. Until the stock reclaims that threshold, the chart offers little evidence of a sustained recovery. The August 18 earnings release will show whether the new products can offset the handset decline — and whether Xiaomi's two-front gamble is beginning to pay off.