Core Viewpoint - Xiaomi has made significant strides in self-developed chip technology, showcasing its "玄戒 O1" chip, positioning itself as the fourth global company capable of designing 3nm SoC chips, following Apple, Qualcomm, and MediaTek [1][28]. Group 1: Xiaomi's Development Journey - Xiaomi's journey in chip development has spanned 11 years since the establishment of Pinecone Electronics, contrasting with Huawei's 22-year timeline [1][28]. - The company has leveraged its manufacturing advantages and internet thinking to disrupt high-value markets dominated by Apple and Samsung, creating a "catalyst effect" in the Chinese tech ecosystem [1][12]. - Xiaomi's approach integrates supply chain resources and fosters close partnerships with suppliers, ensuring product quality and stability [12][13]. Group 2: Market Position and Strategy - Xiaomi's strategy emphasizes high cost-performance, targeting young consumers and ordinary families, while Huawei focuses on the mid-to-high-end market with a premium pricing strategy [20][25]. - The competition between Xiaomi and Huawei is not merely adversarial; both companies contribute to a robust consumer electronics ecosystem that drives innovation and product iteration [25][18]. - Xiaomi's expansion into smart home products and other categories reflects its commitment to building a comprehensive smart ecosystem, with over 1 billion connected IoT devices [19][20]. Group 3: Industry Impact and Future Outlook - The collaboration between Xiaomi and Huawei in supporting suppliers like OFILM Group demonstrates their influence and bargaining power within the supply chain [16][18]. - The evolution of the Chinese consumer electronics industry showcases a shift from OEM and imitation to self-branded products, driven by local market demands [18][30]. - The need for more companies like Xiaomi is emphasized, as they play a crucial role in making technological advancements accessible to the general public [30].

Core Viewpoint - Xiaomi's Investor Day revealed optimistic growth projections for 2025, including over 30% revenue growth and over 40% net profit growth year-on-year, supported by multiple business segments [2][3]. Group 1: Financial Performance - Xiaomi expects its 2025 revenue to grow by more than 30% year-on-year, with adjusted net profit anticipated to exceed 40% growth [2]. - The smartphone segment is projected to see an average selling price (ASP) increase of 3-5% and maintain a gross margin of 12-12.5% [2]. - The AIoT business is also expected to grow over 30% year-on-year, with a gross margin expansion of 2.0-2.5 percentage points [2]. Group 2: Electric Vehicle Business - Xiaomi's smart electric vehicle (EV) business is expected to achieve profitability starting in Q3 2025, aligning with Deutsche Bank's previous expectations [3]. - The company anticipates a net loss of 69 million RMB in Q2 2025, followed by net profits of 400 million RMB and 2.63 billion RMB in Q3 and Q4, respectively [3]. - Projected delivery volumes for 2025 are 86,600 units in Q2, 100,000 units in Q3, and 137,500 units in Q4, totaling 400,000 units for the year, surpassing the previous guidance of 350,000 units [3][4]. Group 3: Global Expansion Plans - Xiaomi plans to enter overseas markets for smart electric vehicles starting in 2027, significantly expanding its retail network [5]. - The number of Xiaomi Mi stores is expected to grow from approximately 500 in 2025 to 3,000 in 2026, aiming for a total of 10,000 stores by 2030 [5]. Group 4: Semiconductor Development - Xiaomi is accelerating its self-research in automotive semiconductors, with plans to begin production of automotive semiconductor products soon [6]. - The company has committed to investing 50 billion RMB in chip development over ten years, with 13.5 billion RMB already invested by February 2025 and an expected 6 billion RMB in R&D for 2025 [6][7].

Group 1: Financial Performance - In Q1 2025, Xiaomi Group achieved total revenue of 111.3 billion yuan, a year-on-year increase of 47.4%, setting a new historical high [1] - The adjusted net profit for the quarter was 10.7 billion yuan, reflecting a year-on-year growth of 64.5%, also a record high [1] Group 2: Mobile Business - Xiaomi's mobile revenue reached 50.6 billion yuan in Q1 2025, with a gross margin of 12.4% [1] - Global smartphone shipments totaled 41.8 million units, marking a 3% year-on-year increase, with a global market share of 14.1% [1] - In the Chinese market, Xiaomi regained the top position with a market share of 18.8% [1] Group 3: IoT and Home Appliances - Xiaomi's IoT revenue for Q1 2025 was 32.3 billion yuan, with a gross margin of 25.2%, both figures reaching historical highs [2] - The company is focusing on high-end and international strategies for its IoT business, with plans to establish 10,000 Xiaomi Home stores overseas from 2025 to 2029 [2] Group 4: Automotive and AI Innovations - Revenue from Xiaomi's automotive and AI innovation business was 18.6 billion yuan in Q1 2025, with a gross margin of 23.2% [2] - The company launched the luxury high-performance SUV model YU7, equipped with advanced technology, and anticipates strong market performance upon pricing announcement [2] Group 5: AI and Chip Development - Xiaomi officially released its self-developed chip, Xuanjie O1, in May 2025, utilizing second-generation 3nm technology [3] - The chip features a 10-core CPU and a 16-core GPU, and will be used in the Xiaomi 15S Pro smartphone and Pad 7 Ultra tablet [3] Group 6: Future Projections - Revenue projections for Xiaomi from 2025 to 2027 are estimated at 486.7 billion yuan, 634.5 billion yuan, and 764.8 billion yuan, with year-on-year growth rates of 33%, 30%, and 21% respectively [3] - Adjusted net profit for the consumer electronics segment is projected to be 41.9 billion yuan, 52.0 billion yuan, and 61.1 billion yuan for the same period, with growth rates of 25%, 24%, and 18% respectively [3]

Investment Rating - The report maintains a "Buy" rating for Xiaomi Group [3][6] Core Views - Xiaomi Group achieved record high revenue and profit in Q1 2025, with total revenue of 111.3 billion yuan, a year-on-year increase of 47.4%, and adjusted net profit of 10.7 billion yuan, up 64.5% year-on-year [1][3] - The smartphone segment regained the top market share in China, with a global shipment of 41.8 million units, a 3% increase year-on-year, and a global market share of 14.1% [1][3] - The IoT business is focusing on high-end and international expansion, with revenue reaching 32.3 billion yuan and a gross margin of 25.2% in Q1 2025 [2][3] - The automotive segment reported revenue of 18.6 billion yuan, with the new SUV model YU7 expected to become a bestseller upon pricing announcement [2][3] Financial Summary - Revenue projections for Xiaomi Group are 486.7 billion yuan in 2025, 634.5 billion yuan in 2026, and 764.8 billion yuan in 2027, with year-on-year growth rates of 33%, 30%, and 21% respectively [3][5] - Adjusted net profit for the main consumer electronics business is expected to be 41.9 billion yuan in 2025, 52.0 billion yuan in 2026, and 61.1 billion yuan in 2027, with growth rates of 25%, 24%, and 18% respectively [3][5] - The report anticipates a significant increase in automotive adjusted net profit, projecting a turnaround to 10.1 billion yuan in 2026 and 20.6 billion yuan in 2027 [3][5] Key Financial Metrics - The report provides a detailed financial forecast, including revenue, adjusted net profit, and earnings per share (EPS) for the years 2023 to 2027, indicating a strong growth trajectory [5][13] - The expected adjusted EPS is projected to be 1.6 yuan in 2025, 2.4 yuan in 2026, and 3.1 yuan in 2027 [3][5] - The price-to-earnings (P/E) ratio is expected to decrease from 29 in 2025 to 15 in 2027, indicating a potentially attractive valuation [3][5]

Investment Rating - The report maintains a "Buy" rating for Xiaomi Group [3][6] Core Views - Xiaomi Group achieved record high revenue and profit in Q1 2025, with total revenue of 111.3 billion yuan, a year-on-year increase of 47.4%, and adjusted net profit of 10.7 billion yuan, up 64.5% year-on-year [1][3] - The smartphone segment regained the top market share in China, with revenue of 50.6 billion yuan and a gross margin of 12.4% in Q1 2025, while global smartphone shipments reached 41.8 million units, a 3% increase [1][3] - The IoT business continues to focus on high-end and international markets, generating 32.3 billion yuan in revenue with a gross margin of 25.2% in Q1 2025 [2][3] - The automotive segment reported revenue of 18.6 billion yuan, with the new SUV model YU7 expected to become a bestseller upon pricing announcement [2][3] Financial Summary - Revenue projections for Xiaomi Group are 486.7 billion yuan, 634.5 billion yuan, and 764.8 billion yuan for 2025, 2026, and 2027 respectively, with year-on-year growth rates of 33%, 30%, and 21% [3][5] - Adjusted net profit for the core consumer electronics business is expected to be 41.9 billion yuan, 52.0 billion yuan, and 61.1 billion yuan for 2025, 2026, and 2027 respectively, with year-on-year growth rates of 25%, 24%, and 18% [3][5] - The report anticipates a target price of 60 HKD for Xiaomi Group based on a P/E ratio of 20x for 2026 estimates [3][6]

Core Insights - Xiaomi has made significant announcements during its 15th anniversary strategic product launch on May 22, including the introduction of the YU7 electric SUV, the flagship smartphone Xiaomi 15S Pro, and the high-end OLED tablet Xiaomi Pad 7 Ultra, along with the self-developed SoC chip, Xuanjie O1 [1][10] Group 1: Product Launches - The Xiaomi YU7 is the company's first pure electric SUV [1] - The Xiaomi 15S Pro smartphone and Xiaomi Pad 7 Ultra tablet were also unveiled, showcasing advanced features [1][8] - The Xuanjie O1 chip is set to be integrated into the Xiaomi 15S Pro and Xiaomi Pad 7 Ultra, marking a significant technological advancement for the company [1][3] Group 2: Chip Development - The Xuanjie O1 chip is a self-developed 3nm flagship processor, making Xiaomi the fourth company globally to produce such a chip, following Qualcomm, Apple, and MediaTek [1][3] - The chip is manufactured using TSMC's second-generation 3nm process and contains 19 billion transistors, achieving GeekBench 6 scores of 3119 for single-core and 9673 for multi-core performance, positioning it as a flagship-level chip [3] - Xiaomi has invested over 13.5 billion RMB in chip development, with a team of 2,500 people, and plans to invest 50 billion RMB over the next decade to support its chip business [6]

Core Viewpoint - The company reported Q1 performance with revenue of 25.9 billion yuan, showing a slight increase of 1% quarter-on-quarter but a significant decrease of 41% year-on-year, while net profit attributable to shareholders was 650 million yuan, up 9% quarter-on-quarter but down 82% year-on-year, aligning with expectations [1] Financial Performance - Q1 automotive gross margin was 19.8%, reflecting a quarter-on-quarter increase in both metrics, with total vehicle sales reaching 93,000 units, up 16% quarter-on-quarter but down 41% year-on-year [1] - The company’s overall gross margin for Q1 was 20.5%, with automotive gross margin at 19.8%, showing a slight increase of 0.5% quarter-on-quarter [1][2] - The average selling price (ASP) and gross profit per vehicle were 266,000 yuan and 53,000 yuan respectively, down 11.9% and 10.0% year-on-year, and down 1.1% and 0.7% quarter-on-quarter [2] Cost Management - The company demonstrated improved cost control with SG&A and R&D expense ratios at 9.8% and 9.7%, respectively, showing a year-on-year decrease of 1.9% and 2.2% [2] - The company expects to continue enhancing quality and efficiency in Q2, with projected deliveries of 123,000 to 128,000 units and revenue between 32.5 billion and 33.8 billion yuan [2] Product Development - Recent launches of the L series and MEGA smart driving models have been smooth, with the MEGA Home version performing well, enhancing expectations for the company's electric vehicle strategy [2] - The company plans to launch the i8 and i6 models in H2 2025, with the i8 featuring a 5C battery and a range of 720 km, which is expected to alleviate range anxiety for users [2] Technological Advancements - The introduction of the Thor-U chip in the L series and MEGA models enhances computational power, and the company is accelerating its self-developed chip initiatives [3] - The existing dual-system architecture will be upgraded to the VLA driver model in July 2025, which is expected to improve generalization capabilities and enhance autonomous driving features [3] Profit Forecast and Valuation - The company maintains its profit forecasts, expecting GAAP net profits of 10.3 billion, 15.8 billion, and 17.8 billion yuan for 2025-2027, with Non-GAAP net profits of 13 billion, 18.6 billion, and 20.8 billion yuan [3] - The target price has been adjusted to 140.34 HKD, maintaining a "buy" rating based on a 21x PE for 2025 [3]

Investment Rating - The report maintains a "Buy" rating for the company [8] Core Views - The company reported Q1 revenue of 25.9 billion RMB, with a year-on-year increase of 1% and a quarter-on-quarter decrease of 41%. The net profit attributable to shareholders was 650 million RMB, reflecting a year-on-year increase of 9% but a quarter-on-quarter decrease of 82%, aligning with expectations [1] - The company is expected to continue improving quality and efficiency, with a projected Q2 delivery of 123,000 to 128,000 vehicles and revenue of 32.5 to 33.8 billion RMB [2] - The launch of new electric models, particularly the i8, is anticipated to enhance sales performance, with expectations of over 5,000 units in steady monthly sales [3] - The introduction of the Thor-U chip in new models is expected to enhance computing power and reduce costs in autonomous driving hardware [4] - The company forecasts GAAP net profits of 10.3 billion, 15.8 billion, and 17.8 billion RMB for 2025-2027, with a target price adjustment to 140.34 HKD based on a 21x PE for 2025 [5][13] Financial Summary - The company expects revenues of 123.9 billion RMB in 2023, growing to 250.2 billion RMB by 2027, with a compound annual growth rate of 5.97% [7] - The projected net profit attributable to shareholders is expected to recover from 8.0 billion RMB in 2024 to 17.8 billion RMB in 2027, indicating a significant growth trajectory [7] - The report highlights a gross margin of 20.5% for Q1 2025, with an automotive gross margin of 19.8%, reflecting improved cost control [2]

Core Viewpoint - Xiaomi Group reported record high revenue and adjusted net profit for Q1 2025, driven by strong performance in its smartphone and IOT segments, alongside a strategic focus on cost reduction and efficiency improvement [1][2][3] Financial Performance - Q1 2025 revenue reached 1112.93 billion, a year-over-year increase of 47.4% and a quarter-over-quarter increase of 2.1% [1] - Adjusted net profit for the same period was 106.76 billion, reflecting a year-over-year growth of 64.5% and a quarter-over-quarter growth of 28.4% [1] - Overall gross margin stood at 22.8%, with a year-over-year increase of 0.5 percentage points [1] Business Segments - The smartphone and AIOT segment generated revenue of 927.13 billion, a year-over-year increase of 22.8% [1] - The smart electric vehicle and AI innovation segment achieved revenue of 185.80 billion [1] - IOT business revenue surged to 323.39 billion, marking a year-over-year increase of 58.7% and contributing 29.1% to total revenue [2] - Internet services revenue reached 90.76 billion, with a year-over-year increase of 12.8% [2] Market Position - Xiaomi's smartphone shipments reached 41.8 million units in Q1 2025, a year-over-year increase of 3.0%, maintaining a global market share of 14.1% [2] - In mainland China, Xiaomi regained the top position in smartphone shipments with a market share of 18.8% [2] R&D and Future Outlook - The company plans to invest 2000 billion over the next five years in core technology development [3] - R&D expenditure for Q1 2025 was 67 billion, a year-over-year increase of 30.1% [3] - The launch of self-developed 3nm flagship SoC chip and the open-sourcing of the Xiaomi MiMo model are significant advancements [3] Investment Recommendation - The company is expected to benefit from its brand recognition and supply chain advantages, with projections for revenue and net profit growth from 2025 to 2027 [4] - Forecasted revenues for 2025, 2026, and 2027 are 5062.65 billion, 6052.13 billion, and 7008.88 billion respectively, with corresponding net profits of 357.09 billion, 457.75 billion, and 598.89 billion [4]

Investment Rating - The report maintains a "Buy" rating for the company [8] - The target price is set at HKD 71.20 [8][9] Core Insights - The company's revenue for Q1 2025 reached a historical high of RMB 111.3 billion, with a year-on-year growth of 47% [1] - Adjusted operating profit increased by 114% year-on-year to RMB 9.96 billion [1] - The IoT and automotive business showed strong gross margins, with the IoT revenue growing by 58.7% year-on-year to RMB 32.3 billion [2] - The automotive segment's gross margin improved to 23.2%, benefiting from increased scale [3] - The smartphone average selling price (ASP) reached a record high of RMB 1,211, with a gross margin of 12.4% [4] Summary by Sections Revenue and Profitability - Q1 2025 revenue was RMB 111.3 billion, a 47% increase year-on-year [1] - Adjusted operating profit for Q1 2025 was RMB 9.96 billion, up 114% year-on-year [1] - IoT revenue reached RMB 32.3 billion, with a gross margin of 25.2%, up 5.4 percentage points year-on-year [2] Automotive Business - The company delivered 75,869 units of the SU7 series in Q1 [3] - The automotive segment reported a gross margin of 23.2%, exceeding expectations [3] - The first SUV, YU7, is expected to launch in July 2025, with a focus on consumer feedback post-launch [3] Smartphone Segment - The smartphone ASP reached RMB 1,211, marking a 5.8% year-on-year increase [4] - The smartphone business maintained a gross margin of 12.4% [4] - The launch of self-developed chips is anticipated to enhance the company's high-end market share [4] Valuation and Future Outlook - The target price of HKD 71.20 is based on a sum-of-the-parts (SOTP) valuation method, reflecting the growth potential in IoT and automotive sectors [5][17] - The forecasted net profit for 2025 is adjusted to RMB 40.99 billion, with a projected growth rate of 50.06% [7][15] - The report anticipates a continued increase in IoT revenue, projecting a 24% year-on-year growth for 2025 [2]