Lei Jun ist nicht mehr so sanftmütig, und es bleiben noch zwei harte Kämpfe zu bestehen.

Xiaomi's automotive business is making profits, and its household appliances are opening up new overseas markets. Lei Jun's two - front battle is showing the first signs of success. However, Xiaomi must rebuild the trust chain between "technology - product - customer" and transform from a "traffic - driven" to a "value - driven" business model.

Recently, Lei Jun, the founder, chairman, and CEO of Xiaomi, has left behind his usually mild image and unusually shown his anger.

On November 16, Lei Jun published several consecutive microblogs to answer the doubts about the safety of Xiaomi cars. He explained that in an interview in April 2024, during the discussion about product definition, he had said: "For a car, appearance is the top priority." However, this does not contradict the fact that "safety is the foundation and prerequisite." To this end, he posted several screenshots of his earlier statements about car safety, all before the release of the Xiaomi SU7.

Source: Screenshot from Weibo

Lei Jun's statement "Appearance is the top priority" was interpreted externally as "Xiaomi cars value appearance more than safety," which raised doubts about the compliance with safety standards. Among the comments of microblog users on that day, Lei Jun explained: "Many people on the Internet have taken my words out of context and distorted and defamed me."

For the Xiaomi car, which is currently in a critical phase of capacity expansion, every small storm in the public can be infinitely magnified. Under this pressure, Xiaomi presented a quarterly report that was highly anticipated externally on November 18.

In the third quarter of 2025, Xiaomi achieved a revenue of 113.1 billion yuan, representing a year - on - year increase of 22.3%. This is already the fourth consecutive quarter in which the revenue has exceeded the 100 - billion - yuan mark. The adjusted net profit was 11.3 billion yuan, a record high, representing a year - on - year increase of 80.9%.

Of particular symbolic significance is that Xiaomi's innovative business segments such as intelligent electric vehicles and AI achieved a monthly profit for the first time in the third quarter, with an operating result of 700 million yuan.

For comparison: Top electric vehicle manufacturers such as Li Auto and Leapmotor only managed to achieve a monthly profit after more than seven years. Even XPeng, which started earlier, only achieved a monthly profit for the first time in this quarter, while NIO is still in the red.

However, Lei Jun has no time to celebrate. In addition to the relatively established smartphone business, he is currently leading two major battles: on the one hand, the intelligent car, which determines Xiaomi's future height, and on the other hand, the IoT business, which concerns the breadth and depth of the Xiaomi ecosystem. These two fronts are crucial for the survival and boundaries of the company.

More importantly, while Xiaomi is experiencing revenue growth, Lei Jun must handle the public challenges regarding product safety and regain the trust of customers in the Xiaomi brand and in him personally. The markets are also waiting for Lei Jun to answer the question of how Xiaomi can avoid the risk of excessive dependence on his personal image.

After the release of the report on November 19, Xiaomi's share price declined on the stock exchange. At the time of writing this article, Xiaomi's stock price had fallen by 4.02% and was at HK$39.14. Compared with the peak of HK$61.45 on June 27, the stock price has already fallen by more than 30% this year.

The battle for cars: Attack and defense behind the profits

"We are expected to reach the annual target of 350,000 delivered vehicles this week." When discussing capacity and delivery speed, Lu Weibing, President of the Xiaomi Group, told the magazine "China Entrepreneur".

Behind the numbers, the Xiaomi car has fully put its capacity and delivery into motion. In the third quarter of 2025, 108,796 new Xiaomi cars were delivered, a record high. In September and October, the monthly delivery volumes were both over 40,000 vehicles.

Even more remarkable is that Xiaomi's intelligent electric vehicle business has achieved a gross margin of 25.5% after only one year on the market. The average net price per vehicle is stable at around 260,000 yuan, which puts it in the same category as luxury brands like BBA.

The simultaneous achievement of these three key indicators - profit, delivery, and gross margin - shows that Xiaomi's business model for its cars is fundamentally working. Behind this report stands a dense network of local sales and service points. By the end of September 2025, Xiaomi had opened 402 sales outlets in 119 cities and set up 209 service points in 125 cities.

Photo: Wu Ying

Despite the success, danger still lurks. Lu Weibing admitted at the earnings conference: "There will also be challenges next year (2026). The gross margin of the car business may decline slightly compared to this year."

He named two key variables: First, the subsidy for vehicle purchase tax will be halved. According to the already published national policy, the subsidy for vehicle purchase tax for electric vehicles in 2026 will be reduced from the current "full exemption" to "half - exemption", with a maximum amount of 15,000 yuan per vehicle. Second, the automotive industry is currently still in the early stage of its development, and the market is fragmented. "It will take some time for the market to consolidate through fierce competition."

The toughest test awaits overseas. Lei Jun has clearly stated that 2027 will be the time for Xiaomi cars to go overseas, and he has chosen the most difficult market - the European market.

"The market share of German automobile brands is more than 50%. Even Toyota, such a strong brand, only has a 3% market share in Germany." Lu Weibing, who recently returned from a trip to Europe, is aware of the difficulty of this battle. In the past two weeks, he has driven the SU7 and the SU7 Ultra on German highways for nearly 800 kilometers himself.

"If we can gain acceptance for our products in Europe, it will be correspondingly much easier to penetrate other markets." Lu Weibing told the magazine "China Entrepreneur".

The battle for IoT: Competing with giants like Midea

Outside the car business, the IoT and consumer goods business is becoming a new growth curve for Xiaomi.

At the "Strategic New Product Press Conference for Xiaomi's 15th Anniversary" in May this year, Lei Jun clearly stated that "the IoT household appliances business has become a strategic business for Xiaomi." Subsequently, Lu Weibing formulated the performance target at the first - quarter 2025 earnings conference: "To be among the top three in China within three years."

At that time, Xiaomi's large - household - appliances business achieved an impressive revenue doubling. In the second quarter of 2025, Xiaomi's IoT and consumer goods business even achieved a higher gross profit than the smartphone business and thus became the most important profit contributor of the Xiaomi Group.

Data from Aowei Cloud Network shows that the online market share of Xiaomi air conditioners reached 16.71% in July 2025, surpassing Gree and ranking second only to Midea.

In the third quarter of 2025, Xiaomi's IoT and consumer goods business achieved a revenue of 27.6 billion yuan, representing a year - on - year increase of 5.6%. The increase has continued for seven consecutive quarters. The gross margin is 23.9%, representing an increase of 3.2% compared to the previous year.

However, it should be noted that the revenue of Xiaomi's intelligent large - household appliances in this quarter decreased by 15.7% compared to the previous year. The report attributes this to "the withdrawal of government subsidies and increasing competition."

In recent years, Xiaomi's Internet strategy has disrupted the stable market structure of the household - appliances industry and broken through the fortresses that traditional household - appliances manufacturers have built over decades.

In March this year, Midea announced in its 2024 annual report that it had sold Xiaomi shares worth 902 million yuan and had liquidated its entire Xiaomi share position at the end of 2024. Since 2020, the Midea Group has successively sold Xiaomi shares and earned a total of nearly 2 billion yuan.

The story of mutual reinforcement between the Internet and the household - appliances industry is over. A conflict between old and new forces has begun, and the competition in the household - appliances market is becoming increasingly fierce. Fang Hongbo, Chairman of Midea, admitted that one should "respect Xiaomi tactically and not fear it strategically." He also mentioned that Midea had prepared "three research reports with a total of more than ten thousand words" about Xiaomi.

In response, Lei Jun replied with great emotional intelligence: "Midea is a very excellent company." He emphasized that one should "learn from each other and produce better products." However, on the JD platform, the price of an air conditioner of the same specification of Midea's subsidiary brand Welling is 120 yuan lower than that of Xiaomi, which clearly shows the intention of a price comparison.

Recently, the leaders of Xiaomi and Gree have also triggered several "verbal battles" in public because of the competition. In September this year, Xiaomi even introduced a "ten - year warranty" policy for air conditioners to counter the competition from rivals.

Lu Weibing told the magazine "China Entrepreneur": "Currently, the household - appliances market is in a transition from the old to the new market structure. The old structure will surely be broken, and a new one will emerge." Earlier, Lu Weibing formulated the goal that Xiaomi "should be among the top brands in the large - household - appliances industry by 2030 and rank second in the air - conditioner industry in China."

To this end, Xiaomi has begun to strengthen its defenses in intelligent manufacturing. In October 2025, Xiaomi's intelligent household - appliances factory in Wuhan was officially put into operation. This is Xiaomi's third large - scale intelligent - manufacturing facility after the smartphone factory and the car factory and is also the most important move in Xiaomi's strategic vision of the "car - human - household - appliances ecosystem." The first phase of the factory has a total investment of more than 2.5 billion yuan and a planned peak capacity of seven million air conditioners per year.

Shan Lianyu, General Manager of Xiaomi's Large - Household - Appliances Department, told the magazine "China Entrepreneur" that Xiaomi's large - household - appliances factory is built on two "giants": on the one hand, the household - appliances industry itself, "which is one of the few industries in China that can export products, technologies, standards, and devices globally. We have learned a lot from our competitors." On the other hand, the manufacturing experience of Xiaomi smartphones and cars.

The cross - category fusion of product categories can be seen everywhere in the Wuhan factory. Shan Lianyu explained that the SMT technology (Surface Mount Technology) and AI quality - inspection capacity from Xiaomi's smartphone business are reused here, which significantly improves the yield of household - appliances circuit boards. Also, the macro - management logic of Xiaomi's car factory is adopted for the optimization of logistics processes in the manufacturing of large household appliances, which leads to the emergence of the concept of "large - scale delivery, large - scale logistics, small - scale production."

Facing the fierce industry competition, Shan Lianyu told the magazine "China Entrepreneur" that the core of the competition for Xiaomi's household appliances is industrial intelligence and product innovation. "Within Xiaomi's large - household - appliances factory, 12,000 data - collection points work in real - time, and 136 AI visual inspections significantly improve production yield and efficiency. Through industrial AI capabilities, the system can make independent decisions, learn, and act."

Outside of production, in the customer - service area, Shan Lianyu gave an example that Xiaomi can prevent air conditioners from operating in a "sub - optimal state" for a long time through intelligent means, which extends their service life. The system can remotely detect that the performance of an air conditioner is decreasing due to a dirty filter and automatically send a cleaning notification. In the past, "about 30% of customer - service tickets were due to a dirty filter."

However, Xiaomi still has weaknesses in offline channels. Data from Aowei Cloud Network shows that in the first seven months of this year, the market shares of Midea, Gree, and Xiaomi in the offline air - conditioner market were 29.63%, 30.21%