Little-known hidden worries behind Xiaomi's new financial report

On May 26th, Xiaomi released the 20021first quarter financial report. After the release, Xiaomi has been strengthening recently. It seems that the market basically recognizes Xiaomi's achievements.

Xiaomi's total revenue in the first quarter was 76.9 billion yuan, a year-on-year increase of 54.7%. The adjusted net profit was 7.79 billion yuan, and the market organization expected it to be 4.92 billion yuan, of which the smartphone revenue reached 565.438+05 billion yuan, up 69.8% year-on-year, and the gross profit margin of mobile phones increased from 8. 1% to 654.38+02.9%. In the first quarter, overseas revenue was 37.4 billion yuan, up 50.6% year-on-year, accounting for 48.7% of the Group's total revenue.

This is the "rising part", which is really good and commendable, but for professional investors, there are far more indicators to look at.

The picture comes from Xiaomi's first quarter financial report.

Let's look at the "healthy part" again. Xiaomi's revenue from IOT and consumer goods in the first quarter was 65.438+0.82 billion yuan, down 65.438+03.4% from the fourth quarter of 2020. Xiaomi explained that the decrease in revenue was due to the decrease in promotional activities in the first quarter of 2026.54+0. Xiaomi's value-added service revenue reached 654.38+06 billion yuan, down 8.6% year-on-year. Xiaomi said it was the impact of financial technology business.

The decline caused by the reduction of promotional activities. Because Xiaomi will be in Q4' s double eleven and double twelve. There will be some performance fluctuations because of the big promotion. According to the comparison of the quarterly growth rate of Q/KLOC-0 in the financial report from the last four years to the fourth quarter of last year, the quarter-on-quarter decline of 13.4% is the third highest level in history and still within the normal range. However, it remains to be seen whether it is only the seasonal temporary impact of promotional activities or the follow-up of systemic problems.

Regarding the adjustment of financial technology business, as we all know, since the suspension of listing of Ant last year, the supervision has started the guidance on financial technology business and operational compliance. JD。 JD.COM Mathematics Department of COM is also adjusting. Xiaomi Finance, which involves small loan business, will inevitably be rectified and its business will shrink.

What many friends may not know is that Xiaomi Finance involves microfinance, mobile payment, internet finance, internet insurance, supply chain finance, financial technology and so on. It can be said that the license is complete.

The picture comes from Xiaomi

According to the statistics of Konas, in terms of smartphone shipments, Xiaomi ranked in the top five in 62 countries and regions around the world this quarter and ranked first in 12 countries and regions around the world. For the first time, it ranked second in Europe and its market share in Latin America rose to third.

The market share looks gratifying, especially overseas, but it should be noted that at present, nearly 90% of overseas business is low-end brands such as Redmi, and it is quite worrying that "quantity increases but price does not rise".

Image from Lei Jun Weibo

When Xiaomi was listed in Hong Kong in 20 18, Lei Jun said that Xiaomi's valuation should be Apple times Tencent, but institutional analysts still followed the valuation given by manufacturing companies, which made Lei Jun feel distressed that they could not understand Xiaomi and misread Xiaomi.

How to look at the market still needs some principles. Not a company can "go to Mars" with the word "technology". There may be a momentary misjudgment in the market, but in the long run, gold will always shine. "Reebs is not Jobs" and Xiaomi is not Apple.

In terms of revenue types, in the first quarter, Xiaomi's mobile phone business accounted for 67%, and IOT and consumer goods accounted for about 24%. Together, it accounts for 965,438+0%, and the remaining game business and advertising revenue business only account for about 9%.

Game and advertising revenue has always been a big part in Internet companies. Even in Xiaomi, the gross profit margin has reached more than 60%. No wonder this part of the share is so small that it will be looked down upon by analysts and considered not to be an Internet company.

Some people may think that IOT's business is imaginative, and new devices that are intelligently connected cannot be valued according to the old methods.

To put it simply, the unit price of customers is still insufficient, and the profit is naturally not good if the growth rate is insufficient.

Look at profits by comparing friends and businessmen. According to counterpoint research, from 20 18 Q 1 to 20 19 Q3, the profit rate of Xiaomi's mobile phone lags far behind that of oppovivo, especially Xiaomi has always advertised that the profit rate of mobile phones is thin, which is particularly cruel in today's Red Sea competition.

The picture comes from the study of counterpoint method.

Then some friends may ask, can't Xiaomi also advertise? There should still be some future prospects. We can't completely deny this possibility, but it is very unlikely.

Xiaomi's advertising market share has been stable at around 4% from 20 19 to 20021quarter. It's not that Xiaomi doesn't want to, but that the giant has no chance to develop too fast. Xiaomi can only rank eighth among Internet companies.

The picture comes from technology.

Once upon a time, the purple rice charging treasure, the Huami smart bracelet, the smart rice air purifier and the balance car of the No.9 robot in the Xiaomi ecological chain were all popular explosions in the market, but now there are few new explosions. In this regard, at the end of 2020, Qu Heng, general manager of Xiaomi Eco-chain, admitted at an internal meeting that in the past two years, there have been fewer explosions in Xiaomi Eco-chain.

Let's take a look at the comparison chart of Xiaomi's revenue structure. The growth rate of Xiaomi eco-chain revenue has been declining. By the first quarter of this year, the total revenue of IOT and consumer goods was only 654.38+0.82 billion yuan, a decrease of 6543.8+03.4% from the previous month. Part of the Xiaomi ecological chain is included in the total revenue of IOT, which will naturally be affected. The income of Xiaomi TV notebook is not very high, accounting for only 20%, and the income is stable at around 5 billion.

Image from interface news

Generally speaking, the Xiaomi ecological chain is under pressure. At present, there is no turning point in revenue and growth rate, which is also the result of fewer explosive products in the Xiaomi ecological chain.

In the eyes of Lei Jun, IOT has always been the general direction of Xiaomi. The annual report of Xiaomi 20 19 points out that the strategic direction of the next generation super Internet of 5G+AI+IOT is clear. However, in the 2020 annual report, "5G+AI" was deleted and changed to establish a new strategy for the next decade-mobile phone xAIoT. Why doesn't Xiaomi do 5G? There is no speculation here, but there is no doubt that IOT is the strategic focus.

Although it is the center of gravity, the position will also change. Chang Jing, CEO of Roborock, pointed out in an interview last year that the relationship with Xiaomi mainly depends on whether the order can be met, and the subtext is that quantity is more important in the relationship between the two companies.

The picture is from Yiou. com

You know, during the honeymoon period, from 20 14 to 20 16, Xiaomi will give eco-chain enterprises a two-year exclusive track, and then there will be moderate competition. But the current situation is that in Xiaomi Youpin Mall, Roborock sweeping robot faces brand competition including about ten Xiaomi.

A few years ago, there were media reports that the voice of "escaping" the Xiaomi ecological chain was rumored by many ecological chain enterprises. However, Huami Technology, Roborock, Magic Acoustics, etc. Have launched their own brands. In 20 18, Roborock's private brand income was 65.438+048 billion yuan, Mijia brand income was 65.438+044 billion yuan, and private brand income exceeded 50%.

Especially in the context of declining revenue growth and falling prices and costs, Xiaomi is still not the best partner, which may need to be reconsidered, or a qualifier "* * * will win" may be added.

In the first quarter of this year, Xiaomi's domestic market share increased from 10.7% to 14. 1%, but it still ranked fourth in China and third in the international market. Many people exclaimed that Xiaomi stood up, and the era of Xiaomi came. Anyone who pays a little attention to the news should know that Huawei has been suppressed and lost some market share for many reasons.

According to IDC's report, Huawei's mobile phone shipments decreased by 2 1.6% in 2020, from 240 million units in 20 19 to 654.38+88 million units. Canalys statistics show that Huawei ranked third in the domestic market in the first quarter of 2026, with 5438+06%. Huawei's limited procurement and splitting of low-end chips in glory will indeed create a market vacuum for a period of time, but it does not mean that Huawei will not come back. Xiaomi should know very well that glory is his first opponent.

In the field of IOT, Huawei has formulated the strategy of 1+8+N and launched its own HiLink standard. Within three years, one-third of IOT devices in China will support the HiLink standard, with independence and glory as the forerunner. On the evening of June 2nd, Huawei released the operating system of HarmonyOS system, and domestic appliance giant Tai Fang Jiuyang has announced its access to Huawei's HarmonyOS system.

Image from Huawei Mall

It is estimated that more enterprises will access in the future, which is more economical than repeatedly making wheels or borrowing directly. So Xiaomi, who is developing a series of chips, is going to develop its own operating system or what? We will wait and see.

I have seen many media articles always like to deify Lei Jun, and I think what he did must be meaningful and right. Companies like Xiaomi, which are close to the trillion-dollar market value, should make few mistakes. Actually, it's more like smearing. Whether you like it or not, a hero is a hero.

Enterprise management is a long-term dynamic and complex game, and the variables to be considered in real business are much more complicated than those in textbooks, so there may be missed opportunities in some aspects, even strategic and tactical mistakes. I think there is no problem with Xiaomi's strategy, but combined with the realistic analysis I said above, we should pay attention to tactical issues.