Xiaomi's Share Buyback Billions Fail to Spark a Rally

Xiaomi's stock nears yearly lows despite a strong EV division and massive share buybacks. Upcoming product launches and quarterly results are key to watch.

Despite a multi-billion dollar effort to prop up its valuation, Xiaomi's stock continues to languish near yearly lows. The Chinese tech giant's shares recently touched a 52-week low of €3.38, and even a slight recovery to €3.52 leaves the equity down nearly 22% year-to-date. This persistent weakness stands in stark contrast to the company's aggressive capital return program and robust operational developments in key growth areas.

Operationally, the company's electric vehicle division is rapidly becoming a powerhouse. Xiaomi delivered over 411,000 vehicles in the last fiscal year, tripling its prior-year output. The segment achieved its first positive operating profit with a gross margin exceeding 24%. Management has set an ambitious delivery target of 550,000 units for 2026. Founder Lei Jun has further defined the EV strategy, stating Xiaomi will not launch any car priced below 100,000 yuan, focusing instead on premium models where intelligent driving systems and software ecosystems can be profitable. Demand appears strong; the new SU7 2026 model garnered 15,000 orders within 34 minutes of launch and has accumulated over 40,000 firm reservations in total.

The company's commitment to its share price is unambiguous. Since the start of the year, management has deployed HKD 4.7 billion to repurchase its own stock, following a HKD 6.3 billion buyback spree the previous year. This massive financial support signals leadership's firm belief that the company is undervalued, yet the market remains unconvinced. The stock currently trades almost 47% below its 52-week high, with all major moving averages pointing downward. Technical indicators suggest recent minor gains may be fragile, with the Relative Strength Index hovering around 77, a level typically considered overbought.

Beyond EVs, Xiaomi is preparing a significant product launch. On April 21, the company will unveil a broad new device lineup in China. The headliner is the Redmi K90 Max, the brand's first smartphone featuring an active cooling system with an 18.1mm fan designed to reduce internal temperatures by up to 10 degrees under sustained load. It will be equipped with an 8,550 mAh battery supporting 100-watt charging. The launch also includes the Redmi Book Pro 2026 laptop series in 14-inch and 16-inch sizes, both powered by Intel's Core Ultra X7 Panther Lake processor with 16 cores. Two new tablets, the Redmi K Pad 2 and a more affordable Redmi Pad 2 SE, will round out the presentation.

These positive signals are counterbalanced by a challenging global smartphone market. Worldwide shipments declined by 6% year-on-year in the first quarter of 2026, according to Counterpoint Research. While Xiaomi's 17-series is selling well in its home market, the growth in its premium segment must offset rising component costs across the broader portfolio.

All eyes are now on the upcoming quarterly report scheduled for May 27. This release will provide critical evidence of whether the strong EV demand and premium product momentum are translating into financial performance. Analyst consensus remains optimistic, with an average price target near HKD 44, implying an upside potential of over 37% from current levels. For now, the market is waiting for concrete proof that the company's operational firepower can finally break the stock's downward trend.