Xiaomi's Green Alloy Push and New EV Brand Fail to Halt Stock's Descent Near Historic Lows

Xiaomi shares slide to €2.58, near 52-week low, as smartphone sales drop 24% during 618 festival amid soaring memory chip costs; EV division posts Q1 loss and co-founder plans $2B share sale.

Xiaomi shares closed at €2.58 on Tuesday, shedding 1.68% on the day and leaving the stock nursing a year-to-date loss of 42.49%. The latest slide keeps the equity just 10% above the 52-week trough of €2.34, touched on 26 June 2026, as a string of operational bright spots struggles to offset deep-seated headwinds in the company’s core smartphone business and fledgling EV division.

On one side of the ledger, the company is forging ahead with ambitious automotive and materials projects. It has confirmed the name “Sky Nomad” (Xuntian) for its new range-extended electric vehicle (EREV) brand, whose first model – the full-size Kunlun N3 SUV, stretching over 5.3 metres – is slated for a second-half 2026 launch. Meanwhile, Xiaomi has introduced Titan Alloy 2.0, a 100% recycled aluminium alloy independently certified by the IVL Swedish Environmental Research Institute. The company claims it cuts CO? emissions by roughly 93% compared with primary aluminium, saving nearly 800 kilograms per vehicle and, at a targeted annual production of 550,000 EVs, a total reduction of almost 450,000 tonnes.

Yet these green credentials and the promise of a new vehicle line are doing little to lift investor sentiment. The real damage is being done in China’s all-important smartphone market. During the annual “618” shopping festival – the four weeks from 26 May to 21 June – Xiaomi’s handset sales tumbled 24% year on year, according to Counterpoint Research. While the broader Chinese smartphone market shrank 13%, Huawei surged 19% to capture a 21% share and the top spot, and even Apple, which resorted to discounts on the iPhone 17 Pro, suffered only a 9% drop. Honor fared worse with a 33% plunge, but that offers cold comfort to Xiaomi investors watching their brand cede ground.

The primary culprit behind Xiaomi’s restrained discounting during 618 is the soaring cost of memory chips. DRAM and NAND module prices – inflated by the global AI boom – rose by as much as 90% in the first half of 2026, leaving manufacturers caught between protecting margins and offering aggressive promotions. Xiaomi chose the former and promptly lost price-sensitive customers to rivals. Already, Omdia data showed a 19% sequential decline in global smartphone shipments in the first quarter of 2026, and the 618 numbers confirm the trend is accelerating.

Pressure is building on multiple fronts. The EV division reported an operating loss of approximately 3.1 billion renminbi in the first quarter, while gross margins in the automotive segment shrank from 25.5% to 20.1% quarter on quarter. Although monthly EV deliveries have now exceeded 30,000 units for three consecutive months, meeting the full-year target of 550,000 vehicles still looks challenging after a slow first half. Sales of the core SU7 model fell 14.24% year on year in May, compounding the margin squeeze. Adding to the unease, co-founder Lin Bin is reportedly planning to sell shares worth up to US$2 billion.

On the software side, Xiaomi is restructuring its AI assistant Xiao Ai into an infrastructure layer for its “Human x Car x Home” ecosystem, and HyperOS 4 is expected to launch in China by July or August 2026. The company is also betting on the next generation of flagship hardware: the Xiaomi 18 Pro Max, due in September, will pack a 2-nanometer Snapdragon chip, an 8,500 mAh battery, and a dual 200-megapixel camera system. Whether that will be enough to reclaim market share from Huawei in the premium segment remains an open question.

Chart watchers see few reasons to buy the dip. The stock sits 14.93% below its 50-day moving average of €3.03 and 34.39% under the 200-day line of €3.94. The relative strength index of 36.5 shows the shares are approaching oversold territory, but as Tuesday’s modest weekly gain of 4.41% demonstrates, any bounce is tentative at best. Until the smartphone tide turns or the EV unit demonstrates it can deliver profitability at scale, Xiaomi’s shares look set to remain anchored near the floor.