Xiaomi Corp (HK:1810) shares rose in Hong Kong trade on Wednesday after the company clocked record first-quarter earnings on strong smartphone sales and a successful foray into chipmaking and electric vehicles.
Xiaomi (OTC:XIACF) rose 1.4% to HK$52.25 by the afternoon break, having earlier risen as high as HK$53.30. But shares retreated tracking broader weakness in Hong Kong’s Hang Seng index, which shed 0.5% as soft earnings from e-commerce giant PDD Holdings (NASDAQ:PDD) sparked more concerns over the Chinese economy.
Xiaomi’s shares were also trading up nearly 54% so far in 2025, limiting overall upside from its strong quarterly earnings.
Xiaomi clocked revenue for the three months to March 31 of 111.2 billion yuan ($16.46 billion), up over 47% from last year, while adjusted net profit surged 64.5% to a record-high 10.68 billion yuan.
Revenue from Xiaomi’s smartphone and smart devices segment- its biggest moneymaker- rose 22.8% in the quarter, also boosted by increased Chinese government subsidies for electronics. This was supplemented by growing revenue from Xiaomi’s EV and artificial intelligence units, although the units still clocked a loss for the quarter.
But while Xiaomi did clock record-high earnings, it spent more on research and development, and flagged increased expenses in the remainder of the year, especially on AI.
The company had last month launched its first in-house AI reasoning model- MiMo, as it pushes further into the fast-growing industry. But Xiaomi’s AI efforts are likely to face heightened competition from several of its Chinese tech peers, who have already launched several versions of their in-house AI models.
On the chipmaking front, Xiaomi had last week unveiled an in-house smartphone chip called the Xring O1, which it claimed outperformed similar offerings from rival Apple Inc (NASDAQ:AAPL).
The company’s EV sales appeared to be progressing steadily, despite some hiccups from a recent, deadly crash involving its driver assistance feature, as well consumer backlash over alleged false advertising.
Xiaomi recently unveiled a new EV- the YU7 sports utility vehicle, which will likely compete with the Tesla Inc (NASDAQ:TSLA) Model Y in domestic markets.
