To The Moon

$XIAOMI-W(01810)$ is scheduled to announce its Q1 2025 results on 27 May 2025 (Tuesday), with an investor conference call/audio webcast at 7:30 PM HKT.

Revenue Growth: The consensus revenue forecast for Q1 2025 is RMB 109.057 billion, representing a significant +44.43% year-on-year (YoY) increase. This strong growth is anticipated to be driven by various factors, including a rebound in its core businesses and the successful foray into the electric vehicle (EV) market.

Earnings Per Share (EPS): The consensus EPS forecast for Q1 2025 is RMB 0.291, suggesting a substantial +71.18% YoY increase.

Profitability: Analysts anticipate robust profit growth. Huatai Securities, for example, projects a 47% YoY increase in net profit attributable to the parent company and a 52% surge in non-GAAP profit for the full year 2025, driven by a rebound in handset Gross Profit Margin (GPM), narrowing automotive losses, and expansion of the major home appliances business.

Gross Margin: Huatai Securities expects GPM to edge up by 0.9 percentage points quarter-on-quarter (QoQ) in Q1 2025.

Smartphone Market Leadership in China: Xiaomi is expected to have reclaimed the top position in China's smartphone market in Q1 2025, a first in a decade.

Smartphone Shipments: The company reportedly shipped 13.3 million units in Q1 2025, a significant increase from 9.5 million in Q1 2024, boosting its market share from 14% to 19%. This growth is attributed to strong ecosystem synergies and China's national subsidy programs.

Smartphone Premiumization Strategy: Xiaomi's focus on ultra-premium models (e.g., Xiaomi 15 Ultra) is expected to contribute to a better product mix and potentially higher Average Selling Prices (ASPs).

IoT and Lifestyle Products: This segment is anticipated to continue its robust growth trajectory. In 2024, IoT and lifestyle products revenue exceeded RMB 100 billion for the first time, and this trend is likely to continue into Q1 2025 with strong shipments of air conditioners, refrigerators, and washing machines.

Internet Services: The internet services business is expected to maintain its high gross profit margin, driven by an expanding global user base. Global Monthly Active Users (MAU) surpassed 700 million for the first time in December 2024.

Electric Vehicle (EV) Business: The successful debut of the Xiaomi SU7 electric sedan is a significant new revenue stream. While specific Q1 2025 EV revenue figures aren't available, analysts expect strong demand and potential for further growth. Xiaomi is already expanding its EV production capacity and aims to deliver 350,000 vehicles in 2025. The EV GPM has also been a positive surprise in previous quarters, and this trend is expected to continue.

Factors to Watch During the Earnings Release

Actual vs. Estimated Figures: How closely Xiaomi's reported revenue and EPS align with or exceed the analyst consensus will be a key indicator of its performance.

Detailed Segment Performance: A breakdown of revenue and profitability across smartphones, IoT and lifestyle products, internet services, and especially the newly emerging EV segment will provide deeper insights.

EV Business Commentary: Any updates on SU7 production, delivery targets, and profitability within the EV segment will be closely scrutinized by investors.

Gross Margin Trends: Confirmation of improving gross margins across its various business segments, particularly for smartphones and EVs, will be positive.

Future Guidance: Xiaomi's outlook and guidance for Q2 2025 and the remainder of 2025, especially concerning smartphone shipments, EV production, and overall revenue and profit growth, will be crucial for investor sentiment.

R&D Investment: Commentary on continued investment in R&D, particularly in AI development, will be relevant as Xiaomi positions itself for future growth.

IoT and Lifestyle Products market in Southeast Asia

Xiaomi has made significant inroads into the IoT and Lifestyle Products market in Southeast Asia, leveraging its established brand presence from smartphones and its "Human x Car x Home" smart ecosystem strategy.

While precise, granular market penetration figures for every single IoT product category across all Southeast Asian countries are often proprietary and not publicly available.

Here are some of the available information which we could look at this major earnings contributor segment - IoT and Lifestyle

Overall Strategy and Growth in Southeast Asia

Ecosystem Approach: Xiaomi's strength lies in its extensive ecosystem of interconnected devices. This includes not just smartphones, but also wearables (smartwatches, fitness bands), smart home appliances (air purifiers, smart bulbs, robotic vacuums, security cameras), smart TVs, and other smart gadgets. This integrated approach encourages users to adopt multiple Xiaomi products, increasing stickiness and market penetration.

Affordability and Value Proposition: A key driver of Xiaomi's success in price-sensitive markets like Southeast Asia is its strategy of offering feature-rich products at competitive prices. This "value for money" approach resonates well with consumers in the region.

Online and Offline Expansion: While Xiaomi initially relied heavily on e-commerce, it has been actively expanding its offline retail presence through "Mi Stores" and partnerships with local retailers. This omnichannel approach allows them to reach a wider customer base and provide hands-on experience with their IoT products.

Localization: Xiaomi often tailors its product offerings and marketing strategies to specific regional preferences, which helps in deeper market penetration.

Strong Brand Recognition: Xiaomi's success in the smartphone market in Southeast Asia has built a strong brand foundation, making it easier for them to introduce and sell other IoT and lifestyle products to an existing loyal customer base.

Key Product Categories and Their Penetration

Wearables (Smartwatches and Fitness Bands): Xiaomi is a major player in the global wearable band market, and this extends to Southeast Asia. They have seen strong sales of their Mi Bands and Redmi Watch series. In Q1 2025, Xiaomi led the global wearable band market for the first time since Q2 2021, with a 44% shipment growth, driven by their broad portfolio and integration through HyperOS. This strong global performance indicates significant penetration in key emerging markets like Southeast Asia, where affordable yet feature-rich wearables are highly sought after.

Smart Home Appliances:

Air Purifiers: Xiaomi is a known player in the air purifier market in the Asia Pacific region, including Southeast Asia. They are listed among key companies in the Asia Pacific air purifier market. The company is actively expanding its home appliance lineup in countries like Vietnam, introducing air conditioners, refrigerators, and washing machines. While specific market share figures for air purifiers in Southeast Asia are not readily available, their presence and expansion plans suggest increasing penetration.Smart TVs: Xiaomi has made significant inroads into the TV market, particularly in Asia. In Vietnam, for instance, Xiaomi has been selling TVs since 2022 and frequently ranks among the top three online TV sellers alongside LG and Samsung. Their smart TVs integrate seamlessly with other Xiaomi smart home devices, appealing to consumers looking for a connected home experience.Other Smart Home Devices: This category includes smart bulbs, security cameras, robot vacuums, and other smaller smart gadgets. Xiaomi's comprehensive range and competitive pricing allow them to gain traction in the burgeoning smart home market in Southeast Asia.

Growth in Major Home Appliances: In 2024, Xiaomi's large smart home appliances (air conditioners, refrigerators, washing machines) saw significant growth, with shipments reaching record highs. While global figures, the expansion of these products into overseas markets, with Southeast Asia often being the first step for Xiaomi's large home appliances going overseas, suggests a strong push for market penetration in the region.

Challenges and Opportunities

Competition: The Southeast Asian IoT market is highly competitive, with established global brands (Samsung, LG, Philips, Dyson) and regional players vying for market share.

After-Sales Service: As Xiaomi expands into more complex appliances, strong after-sales service, including installation, maintenance, and repairs, will be crucial for sustained market penetration and customer satisfaction in Southeast Asia.

Infrastructure and Connectivity: While internet penetration is growing, consistent and reliable internet infrastructure is still developing in some parts of Southeast Asia, which can impact the adoption of smart home devices that rely on constant connectivity.

Consumer Awareness: Educating consumers about the benefits and ease of use of an integrated smart ecosystem remains an ongoing task for all players in the IoT space.

XiaoMi-W (01810.HK) Price Target

Based on 31 analysts from Tiger Brokers offering 12 month price targets for Xiaomi in the last 3 months. The average price target is HK$59.954 with a high forecast of HK$80.00 and a low forecast of HK$24.00. The average price target represents a 13.12% change from the last price of HK$53.00.

Technical Analysis - Exponential Moving Average (EMA)

We are seeing that XiaoMi (1810) share price is still in a negative RSI momentum, but looking at the overall performance recently, we can see that the bulls have defended the the 26-EMA and 50-EMA well, and they are trying to make a daily uptrend.

But can they really push forward would depend on next week when we see how the market would be reacting the news on tariffs by President Trump, will there be more device makers like XiaoMi be affected by Apple and Samsung if the devices is not made in the US for US consumer consumption, if XiaoMi major segment earnings contributor can come from other regions, then we might see a recovery to the positive momentum, this would probably let XiaoMi provide a surge or gap up in the Hong Kong market trading on 27 May 2025 when it releases its earnings.

We are not seeing any increase in short interest for XiaoMi (01810) with pretty low volume, so investors remains upbeat for the earnings, so I would probably planned to see if we can plan for a trade for XiaoMi (01810).

Summary

Xiaomi is expected to report a strong Q1 2025, driven by renewed momentum in its smartphone business, continued growth in IoT, and the promising performance of its new EV venture. Investors will be keen to see if the company can meet or exceed these high expectations and provide optimistic guidance for the upcoming quarters.

Xiaomi has a strong and growing market penetration in the IoT and Lifestyle Products segment across Southeast Asia. Its strategy of affordable, feature-rich products, combined with its ecosystem approach and expanding retail presence, positions it well for continued growth in the region. The increasing focus on larger smart home appliances like air conditioners and refrigerators further demonstrates its commitment to expanding its footprint beyond smaller gadgets.

Appreciate if you could share your thoughts in the comment section whether you think XiaoMi earnings could see significant contribution from the IoT and Lifestyle Products segment.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.