Zhi Tong Cai Jing·2025-08-07 08:41Group 1 - The core viewpoint of the report indicates that Xiaomi Group's Q2 performance may fall short of expectations due to weak smartphone demand, leading to a target price adjustment from HKD 73 to HKD 69.85 while maintaining a "Buy" rating [1] - Third-party data and industry surveys suggest that global smartphone demand will be weak in Q2 2025, with high inventory levels for Android devices, particularly in emerging markets like Southeast Asia and India [1] - Xiaomi's smartphone revenue forecast for Q2 2025 has been reduced by approximately 5%, and the gross margin forecast has been lowered by 0.5% to 11.8% due to a more pessimistic outlook on global smartphone demand and competition [1] Group 2 - The report highlights that Xiaomi's electric vehicle (EV) deliveries are progressing well, with gross margins improving due to a better product mix, maintaining a Q2 delivery volume of 81,000 units and a gross margin increase to 23.9% driven by a higher proportion of SU7 Ultra model deliveries [1] - Management has indicated that the second EV factory has not yet commenced commercial production, but once operational, it will significantly enhance capacity [1] - Investor sentiment towards the Chinese automotive industry has become more cautious due to lower-than-expected demand for new models from other local brands, yet the long waiting times for the SU7 and YU7 models bolster confidence in long-term forecasts [1]