Xiaomi sees slowest revenue growth of 5.5 percent in Q3 as Huawei captures most of the China market

Xiaomi's smartphone shipments to Chinese consumers fell by a third in the September quarter.


Chinese smartphone maker Xiaomi posted its slowest-ever quarterly revenue growth, as the country's smartphone market copes with a protracted lull in sales and bigger rival Huawei grabs more market share. Revenue in the first quarter ended 30 September rose 5.5 percent to CNY 53.66 billion (roughly Rs 53,900 crores) from the same period last year, largely in line with analysts' expectation of CNY 53.74 billion. Net income rose to CNY 3.47 billion (roughly Rs 3,500 crores), up from CNY 2.50 billion a year ago.

 Xiaomi sees slowest revenue growth of 5.5 percent in Q3 as Huawei captures most of the China market

Xiaomi shipments to Chinese consumers fell by a third in the September quarter. Image: Reuters

Demand for smartphones has eased in China as consumers hold on to devices longer. As well, Chinese shoppers have rallied behind and boosted sales at Huawei, the world's second-largest smartphone maker, which was added to a trade blacklist by the United States.

Xiaomi shipments to Chinese consumers fell by a third in the September quarter, according to market research firm Canalys, while Huawei's rose 66 percent. Total smartphone shipments in China shrank 3 percent.

(Also read: Huawei says it has sold 200 million devices in 2019, took 64 more days to touch this target in 2018)

Once the darling of China's smartphone industry, Xiaomi still makes most of it money selling smartphones but has been touting its aspirations to boost its internet services division, which mainly consists of online ad sales.
Revenue from this business jumped 12.3 percent to CNY 5.31 billion on the year. The unit contributed 10 percent of the company's total sales, roughly the same as when it listed in August 2018.

(Also read: Huawei’s third quarter revenue grows by 24.4 percent year-on-year despite US blacklist)

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