Xiaomi's 15 Years: Is the Growth Ceiling Approaching?
Fifteen Years of Xiaomi: Is the Growth Ceiling Approaching?
On October 22nd, in response to the recent online rumors such as "Xiaomi cars can connect to SOS in 1 second without queuing time", Li Xiaoshuang, the vice president of Xiaomi Auto, posted that the content was completely false. The company has never made such a claim at press conferences or in promotional materials. It was generated using AI technology to slander Xiaomi Auto.
Recent controversies have once again brought Xiaomi, a company that has maintained high popularity for years, into the spotlight. Different from years ago, while Xiaomi is receiving praise, there are also more diverse voices on the Internet.
Due to Xiaomi's long - standing popularity and high traffic in the consumer electronics and automotive circles, some news is always captured by the media and netizens and becomes a topic of conversation after meals.
Many people believe that Xiaomi is just a company that drives growth through marketing.
The founder doesn't quite agree with this view. In a public speech at the end of this year, Lei Jun also thought that people had a serious misunderstanding. The Internet was full of various doubts, criticisms, and attacks. Many people were biased against Xiaomi, thinking it had no real technology, only knew how to market, and was just an assembly factory. He himself was also deeply troubled by such thoughts.
Back in late February this year, with the successive launches of the Xiaomi 15 Ultra and the high - performance coupe SU7 Ultra, the total market value of Xiaomi's Hong Kong - listed shares soared explosively, accumulating a surge of HK$1.3 trillion. It still stands at HK$1.2 trillion, a recent high.
In the eyes of market observers, since its listing on the Hong Kong Stock Exchange at an issue price of HK$17 in 2018, Xiaomi's breakthrough performance in the "mobile phones + cars" dual - track strategy has long laid the foundation for the continuous rise of its valuation and stock price. These two tracks have not only reshaped Xiaomi's business map but also redefined the capital market's perception of its value.
However, for Xiaomi, which has gone through nearly 15 years of development, although the stereotype of "Xiaomi with simple weapons" is fading, there is still room for improvement behind the glory brought by high - end breakthroughs and the implementation of the automotive business.
Developing Amidst Marketing - Oriented Voices, Core Tracks Support High Market Value
Xiaomi was just a mobile phone company in its early days. To understand the logic behind Xiaomi's current market value, we need to look for answers from the timeline of its commercial evolution.
Over the past years, Xiaomi's founder and his personal brand have indeed become an important way for Xiaomi to promote its products. Take Douyin as an example. Currently, Lei Jun has over 44 million followers. In industries such as mobile phones, cars, and home appliances, this is a phenomenon - level achievement, which also demonstrates his huge market influence to some extent.
However, looking back, it's a bit one - sided to simply attribute Xiaomi's success to marketing.
In fact, over the years, Xiaomi has completed three key strategic leaps, each of which has led to a qualitative change in its valuation logic.
Since 2010, the mobile phone market has evolved from a blue - ocean market in the early stage to a highly competitive one. Xiaomi relied on cost - effectiveness. For example, the starting price of the first - generation Redmi was 799 yuan, which broke the price bottom line of smartphones at that time and instantly made the slogan "For the Fiercely Passionate" take root among the young generation. At the 2017 annual meeting, Lei Jun said, "In the years of making mobile phones, Xiaomi has defeated almost all the shanzhai (counterfeit) mobile phones in the market."
From 2018 to 2020, during the initial stage when the smartphone market was in a blue - ocean period, Xiaomi took this opportunity to enter the capital market and quickly completed the shaping of its brand image. It gradually penetrated into the mid - to high - end market from an Internet - based mobile phone brand at the beginning, laying a user foundation for its subsequent development.
August 2020 was an important turning point. Xiaomi upgraded its "mobile phones + AIoT" strategy to "mobile phones × AIoT", building an ecological barrier through scenario - based collaboration. At this time, the valuation anchor began to shift to a dual - driven model of "hardware + ecosystem".
In March 2021, when Lei Jun announced Xiaomi's entry into the intelligent electric vehicle field, it completely rewrote Xiaomi's valuation story. The implementation of the "human - vehicle - home" full - ecosystem layout has elevated Xiaomi from a consumer electronics enterprise to a technology - manufacturing platform company.
The synergistic effect of the two tracks quickly became apparent. In the mobile phone business, the Xiaomi 14 series laid the foundation for high - end development. In Q2 2025, the brand's activation volume reached the first place in China, and in Q3, the global shipments further increased to 43.5 million units, ranking third globally with a market share of 13.5%.
In the automotive business, Xiaomi has delivered approximately 400,000 vehicles so far, with monthly deliveries reaching 40,000 units.
It can be said that the explosive growth of the dual tracks has jointly supported Xiaomi's current market value of trillions.
Advancing Amidst Public Controversies, Both Mobile Phones and Cars Face Challenges
Famous people often attract more controversies. Discussions about Xiaomi have always been popular in the market. Objectively speaking, there are different analyses and viewpoints from the media, and of course, Xiaomi's own actions have also caused disputes.
A typical example is that many people criticized Xiaomi for directly benchmarking the Xiaomi 17 against the iPhone 17. Some media also believe that Xiaomi's marketing of the Xiaomi 17 as the "King of Backlight" is increasing the social trust cost. They think that from the "world's first dual - frequency GPS" to the "transparent ceramic body", from the "push of urban assisted driving" to the "lifetime free data package", Xiaomi's marketing history is almost an evolution history of "qualifier - based marketing".
When a business strategy goes too far, it often brings different negative voices.
In the automotive field, since the accident of Xiaomi cars in Anhui last year, the public has been paying attention to news about Xiaomi car accidents. Of course, the question of why the car doors couldn't be opened after a car caught fire is a professional technical issue worthy of discussion. The public also has different opinions on Xiaomi's responsibility in this regard.
Xiaomi's mobile phone business also faces challenges. Competitors have opened up the high - end market with self - developed chips and ecosystem. Xiaomi's self - developed Xuanjie O1 chip still needs further market testing, and there is still a large gap in brand premium ability and user recognition. As a result, Huawei and Apple still occupy most of the high - end mobile phone market share in China, and Xiaomi still needs to improve in terms of achieving large - scale market share in the high - end segment.
Even if we don't talk about the high - end market, Xiaomi's mobile phone shipments are okay in the global market but still lag in the domestic market. IDC data shows that Xiaomi's mobile phone shipments dropped from the first place in the first quarter to the fourth place in the third quarter.
Back to the automotive business, although it has become a new growth engine, it also faces challenges.
On the one hand, it's due to public opinion. Considering that Xiaomi is a high - profile and high - traffic brand, once there is a Xiaomi car accident, there are always some controversial voices. On the other hand, automotive safety is indeed an area where Xiaomi needs to be in awe and make continuous investments. How to make cars safer is a bottom - line rule that both new and old automotive manufacturers, including Xiaomi, should follow.
In Q2 2025, the revenue from Xiaomi's intelligent electric vehicle and AI business reached 21.3 billion yuan, a year - on - year increase of 233.9%. The automotive business contributed 20.6 billion yuan, but still had a loss of 300 million yuan. This data conforms to industry rules. The automotive industry has a significant heavy - asset nature. Currently, only a few companies such as Tesla and BYD have achieved profitability. It will still take time for Xiaomi to achieve "profit through volume".
The good news is that Lei Jun has predicted that Xiaomi's automotive business is expected to achieve quarterly profit for the first time in the fourth quarter of 2025. In the second quarter of this year, the operating loss of Xiaomi's intelligent electric vehicle and AI innovation business segment was only 300 million yuan. Xiaomi's cars are approaching the profit threshold at a speed faster than the industry expected.
However, market competition is also one of the most urgent issues at present. Against the backdrop of increasingly fierce competition in core technologies such as intelligent driving, Xiaomi also needs to continuously build its own core competitiveness. Judging from the delivery of 40,000 units in September, Xiaomi's production capacity pressure has been further relieved, and investment in intelligent driving capabilities may be the focus in the future.
Will the Growth Peak?
Xiaomi's financial reports seem to tell the outside world that Xiaomi can make good products. After all, consumers' choices and payments don't lie to the market.
In fact, today's Xiaomi mainly relies on the synergistic effect of the "human - vehicle - home" ecosystem. In the home appliance business, such as air conditioners, Xiaomi is also trying to create a third growth curve after mobile phones and cars.
The financial report data for Q2 2025 shows that Xiaomi's home appliance business performed well. The air - conditioner shipments exceeded 5.4 million units, a year - on - year increase of over 60%, and the average price increased by about 10%. The shipments of refrigerators and washing machines reached 790,000 and 600,000 units respectively, with year - on - year growth rates of over 25%. This achievement is due to Xiaomi's ecological synergy advantage. Relying on the 944 million users accumulated through mobile phones and AIoT devices, Xiaomi has achieved rapid penetration of home appliance products, forming a closed - loop of "hardware - driven traffic + service - based monetization".
However, to achieve Lu Weibing's goal of "becoming a leading home appliance brand in China by 2030", Xiaomi still needs to cross two gaps. First, its offline channel capabilities need to be strengthened. Traditional home appliance giants such as Midea and Gree have built a nationwide dealer network, while Xiaomi's reliance on 3C retail channels still has room for improvement in the sinking market. Second, the decades - long industrial accumulation and technological advantages of established enterprises are difficult for Xiaomi to catch up with in the short term.
But from a growth perspective, we expect that Xiaomi's growth has not peaked and will continue to grow.
On the one hand, Xiaomi is empowering its ecosystem through self - developed technologies and global layout. In the mobile phone field, the Xuanjie O1 chip has been applied to high - end models, driving up the gross profit margin of mid - to high - end models. In the automotive field, with the increase in production capacity and monthly delivery volume, there is also great growth potential.
In terms of globalization, Xiaomi plans to enter the European market in 2027. Relying on the channel foundation of its mobile phone business in many countries, it is expected to open up new growth space.
From a cost - effective mobile phone brand to a technology - ecological platform, Xiaomi's growth story has never been without controversy. However, its current market value of HK$1.2 trillion not only recognizes its breakthroughs in the dual tracks but also implies expectations for future challenges.
Looking back, the continuous improvement of Xiaomi's mobile phone shipment ranking in the Chinese market, whether the scale of the automotive business can be further expanded, and whether the ecological synergy can create differentiated value all affect where Xiaomi's growth ceiling lies.
This article is from the WeChat official account “Paicj Official Account” (ID: paicj314), author: Li Tang. Republished by 36Kr with permission.