Summary (from the latest annual and quarterly report – 2018)
- Total equity: 10 billion USD
- Market Cap is 34 billion USD ( the last price of the stock is 10.44 HKD)
- Xiaomi is a technology product and services company founded in early 2010 focusing mainly on smartphones and the Internet of Things products
- The company has 2.1 billion USD in cash on account
- Total equity – cash on account = 10 billion USD – 2.1 billion USD = 7.9 billion USD
- In 2018 the company had 700 million USD long-term debt, short – term debt was 1.2 billion USD (In 2016 total debt was 600 million USD)
- The company's revenue has increased in the latest 2017 annual report to 17 billion USD from 10 billion in 2016
- Net loss in 2017 was 6.4 billion USD, Net income in 2016 was 82 million USD
Opinion about the company
Fundamentally it is a not bad company and in the future we can expect its growth ( total debt is 1.9 billion USD, big amount of cash on company's account, ROE is N/A).
Xiaomi is a technology product and services company founded in early 2010 focusing mainly on smartphones and the Internet of Things products and related Internet services. An early adopter of online smartphone sales, Xiaomi used Android as its operating system but has its own customized user interface called MIUI. Xiaomi released its first smartphone in August 2011 and rapidly gained market share in China to become the country's largest smartphone company in 2014. At the start of Q2 of 2018, Xiaomi was the world's fourth-largest smartphone manufacturer, leading in both the largest market, China, and the second-largest market, India. As competition in its home Chinese smartphone market has intensified and growth has slowed, it has branched out into the other markets and became the number one smartphone company in India by unit shipments in the fourth quarter of 2017. In 2017, from a country perspective, 72% of its overall revenue was generated in Mainland China, down from 94% in 2015.
Xiaomi has 15,000 employees in China, India, Malaysia, Singapore and is expanding to other countries including Indonesia, the Philippines, and South Africa. According to Forbes magazine, Lei Jun, the founder and CEO, has an estimated net worth of US$12.5 billion. He is China's 11th richest person and 118th in the world. Xiaomi was the world's 4th most valuable technology start-up after receiving US$1.1 billion funding from investors, making Xiaomi's valuation more than US$46 billion.
Xiaomi keeps its prices low or close to "bill-of-material" by keeping most of its products in the market longer, eighteen months rather than the six-month norm followed by many smartphone companies. This strategy allows Xiaomi to take advantage of price reductions in the prices of key components of its products. It enables the company to sell hardware with specifications comparable to high-end devices at a fraction of the cost. Xiaomi announced that has shipped 100 million units of phones as of October 26 2018, completing its annual target more than two months ahead of its original plan. The 100 million shipment benchmark, which was set in less than 10 months in 2018, is higher than Xioami’s full-year 2017 shipments, which stood at 90 million units. However, the growth hasn’t been fast enough to help Xiaomi win back market share from rivals in China.
- The company's revenue has increased in the latest 2017 annual report but the company has operated with a net loss
- Xiaomi will have next earnings date on Feb 27, 2019
- For the nine months ended 30 September 2018, Xiaomi Corp revenues increased 64% to RMB130.49B. Net income totaled RMB10.14B vs. loss of RMB30.8B. Revenues reflect Smartphones segment increase of 71% to RMB53.74B, IoT and Lifestyle Products segment increase of 96% to RMB18.08B, Rest of the World segment increase from RMB10.82B to RMB28.88B, Mainland China segment increase of 47% to RMB50.77B (1 Chinese yuan = 0.14826 U.S. dollars)
- The price of stock remains weak because investors are mainly concerned about a sluggish smartphone market in China in the near future. Xiaomi should also face up to its core problem, that is the lack of competitiveness against other local rivals, especially Huawei and vivo groups
Xiaomi standalone subsidiaries and acquisitions:
The Company mainly conducts its businesses through four segments:
- The Smartphone segment is engaged in the sales of smartphones – worth 20 billion USD
- The IoT and Lifestyle product segment is engaged in the sales of other in-house products, including smart televisions (TVs), laptops, artificial intelligence (AI) speakers and smart routers; ecosystem products, including IoT and other smart hardware products, as well as certain lifestyle products – worth 7 billion USD
- The Internet service segment is engaged in the provision of advertising services and Internet value-added services – worth 5 billion USD
- The Others segment is engaged in the provision of repair services for its hardware products – worth 5 billion USD
- In the last several years Xiaomi had several investments (Green Rice Technology, TCL Corporation, Green Rice Technology, Value Simplex, Huisuanzhang, ShareChat, ZestMoney, Samosa, Elevoc Technology, V-Joy Tech, Qutoutiao) - worth 600 million USD
Total =37.6 billion USD