GTHT released a research report adjusting its revenue forecasts for XIAOMI-W (01810) for FY2025E-FY2027E to RMB482.3 billion, RMB634.7 billion, and RMB750.6 billion (previously RMB489.1 billion, RMB641.8 billion, and RMB758.4 billion). Adjusted net profit projections were revised to RMB43.6 billion, RMB67.9 billion, and RMB83.3 billion (previously RMB45.4 billion, RMB68.1 billion, and RMB83.6 billion). The target price was adjusted to HK$65.7, with an "Overweight" rating maintained.
The report highlighted that XIAOMI's vehicle deliveries are steadily increasing, with Q3 deliveries expected to reach approximately 109,000 units. With the ramp-up of Yu7 deliveries, the average selling price (ASP) for vehicles is projected to rise sequentially in Q3, contributing to estimated vehicle sales revenue of around RMB29.2 billion. Due to economies of scale and cost-efficiency improvements in production, XIAOMI's automotive division is anticipated to achieve operating profitability in Q3.
According to IDC, global smartphone shipments in Q3 2025 grew 2.6% YoY, with XIAOMI shipping 43.5 million units (+1.8% YoY), capturing a 13.5% market share (-0.1 ppt YoY). In China, XIAOMI's smartphone shipments declined 1.7% YoY to 10 million units. The bank expects a slight 0.5 ppt QoQ drop in smartphone gross margin to 11% in Q3, attributed to lower domestic sales contribution and rising memory costs. However, Lu Weibing disclosed on October 23 that the newly launched XIAOMI 17 series saw a 30% YoY sales increase, with the Pro version accounting for over 80% of sales, signaling strong premiumization that may partially offset memory cost pressures in Q4.
The report noted that XIAOMI's IoT segment prioritizes profitability, while its internet services provide stable revenue and margins. Due to seasonal weakness and reduced subsidies, IoT revenue is projected at RMB27.7 billion (+6% YoY) with a slight QoQ decline, though gross margin may improve 0.5 ppt to 23%. Internet revenue is expected to grow 7.7% YoY, maintaining a steady gross margin of 75.4%.