Xiaomi's Two-Front Battle: Premium EVs Roll Out as Investors Weigh a Halved Share Price
Published on 08/17/2026 at 17:54 | Redaktion boerse-global.de
The arithmetic at Xiaomi is becoming harder to ignore. The company's SU7 sedan has now surpassed 500,000 deliveries in China within 28.5 months of its market debut — a milestone that underscores the scale of its automotive ambitions. Yet the same week brings a stark reminder of the costs attached: chief executive Lei Jun has ruled out a budget EV for at least the next decade, dashing hopes among investors who had bet on a mass-market volume model to accelerate the company's broader strategy.
Lei's reasoning is straightforward — the development expense of smart vehicle features makes a sub-100,000 yuan (roughly €12,500) car untenable. Instead, Xiaomi is doubling down on premium territory with two new extended-range electric SUVs, the SkyNomad N70 Max and N90 Max, priced from 259,900 yuan (about €33,000) and offering ranges of up to 1,705 kilometres. To drum up early interest, the company is handing out 10,000 1:43 scale model cars to test drivers starting today.
A widening gap between ambition and delivery
The premium positioning may protect margins, but it does little to close the gap between Xiaomi's stated targets and its actual output. The company entered 2026 with a delivery goal of 550,000 EVs, yet the first half produced just 185,000 vehicles — a pace that leaves the annual target looking increasingly out of reach. That shortfall is one of several concerns weighing on the stock, which closed Friday at €2.87, a modest 0.8 per cent gain on the day but still down 7.4 per cent on the week and 34 per cent since the start of the year. The market capitalisation stands at roughly €72.77 billion.
The share price now sits just below its 50-day moving average of €2.89 — a gap of a mere 0.8 per cent — suggesting tentative stabilisation after a long slide from the 52-week high of €6.54 reached in September 2025. The stock remains roughly 56 per cent below that peak.
Buyback cadence tells its own story
Xiaomi's ongoing share repurchase programme offers a window into the pressure the company is under. The current buyback, launched in May with a 20 billion Hong Kong-dollar envelope, replaced an earlier programme that had seen roughly 14.6 billion Hong Kong dollars deployed. Between 3 June and 15 July, Xiaomi spent about 100.7 million Hong Kong dollars across 14 tranches to acquire approximately 79.8 million shares, equivalent to 0.31 per cent of its share capital.
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The pricing of those purchases is telling: the entry price started around HK$28.65 but had fallen to roughly HK$25.82 by 15 July, reflecting the persistent decline in Hong Kong trading. A lock-up period restricting new share issuance ran until 14 August 2026 and has now lapsed.
The smartphone engine sputters
While the EV division grows, the traditional core business is deteriorating at a faster clip. Smartphone shipments fell 19.2 per cent year on year in the first quarter of 2026, with gross margin compressing from 12.4 per cent to 10.1 per cent. Segment revenue for handsets declined 12.5 per cent to 44.273 billion yuan.
Group-wide, first-quarter revenue slipped 10.9 per cent to 99.142 billion yuan, while adjusted net profit dropped 43.1 per cent to 60.72 billion yuan. On a GAAP basis, net income fell 57 per cent to 4.72 billion yuan. The automotive and AI segment, meanwhile, reported an operating loss of 3.1 billion yuan on revenue of 198.64 billion yuan — a 6.9 per cent year-on-year increase that shows growth is still being bought at a price.
Research spending tells a similar story: outlays rose 33.4 per cent to 90 billion yuan, even as revenue and profit in the core business shrink.
A pivotal board meeting
All of this sets the stage for Tuesday, when Xiaomi's board reviews the unaudited interim results for the first half of 2026 and weighs a possible interim dividend. Analysts are not expecting much cheer. Daiwa Securities reaffirmed its "Buy" rating on 11 August but projects a 9 per cent revenue decline to 106 billion yuan for the second quarter, alongside a 22 per cent drop in IoT revenue to 30 billion yuan, citing the normalisation of Chinese subsidy policy and a weak macro environment.
On the software front, Xiaomi has unveiled HyperOS 4, its next-generation operating system, which will power its first wide-format foldable smartphone. A leak suggests the actual rollout may slip to August or later, as the company prioritises stability and Android 17 integration.
The central question for investors remains whether Xiaomi can steer its EV division toward profitability while the smartphone engine — its historical profit centre — continues to lose momentum. With no budget model on the horizon and delivery targets looking stretched, Tuesday's interim report will be scrutinised for any sign that the automotive losses are narrowing. The buyback programme and a possible dividend offer some support, but they do little to address the underlying tension between a capital-intensive EV push and a shrinking core business.
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