Xiaomi made a meagre $56 million in profits in 2013: report

Despite being the third-largest smartphone vendor in the world, Chinese securities filings show that Xiaomi has made a profit of just 347.48 million yuan ($56.15 million) on 26.58 billion yuan ($4.30 billion) in revenue in 2013. The newly disclosed figures provide a snapshot of a four year-old company that has since become the most popular smartphone vendor in China and the third-largest vendor in the world, thanks to a lineup of handset that are considered high-quality yet relatively inexpensive. The results help shed light on long-running speculation in the technology industry over Xiaomi’s margins and the financial impact of business model. Xiaomi devices are known to be priced just a little over the total cost of the components. To keep costs low, they don’t have any physical retail outlets, but rely on online retailers and social media for getting the word out and selling products online. The financial results were included in disclosures made to the Shenzhen Stock Exchange after Xiaomi purchased a 1.3 percent stake in Midea Group Co Ltd, a publicly traded electrical appliance company, for 1.27 billion yuan. The filings also revealed chairman and chief executive Lei Jun claims 77.8 percent ownership of the company , while unnamed shareholders split the remaining shares. A Xiaomi spokeswoman could not immediately provide comment. By comparison, Apple reported $25.4 billion in 2013 revenue in Greater China. With inputs from Reuters