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Xiaomi's Q3 Earnings Released with CNY 130.94 Billion Revenue of the First Three Quarters of 2018
COVID-19 and China

Nov 19, 2018, Xiaomi Group released its Q3 Earnings (unaudited). In this quarter, Xiaomi Group achieved a revenue of CNY 50.8 billion, with a growth of 49.1% year-on-year, the adjusted profit was CNY 2.9 billion, increased by 17.3%. In the first three quarters, Xiaomi achieved a total revenue of CNY 130.94 billion, with a year-on-year growth rate of 64.1%.

Considering the revenue of the different business units, Xiaomi successfully achieved nice growth with all of them:

Smartphone: CNY 35 billion revenue, with a growth of 36.1%

Driven by the growth in smartphone sales and average selling price, the revenue of Xiaomi's smartphone segment in the third quarter of 2018 was approximately CNY 35 billion, an increase of 36.1% over the same period last year.

IoT and consumer goods: CNY 10.8 billion revenue, with a growth of 89.8%

In Q3 2018, Xiaomi's IoT and consumer goods segment generated revenue of CNY 10.8 billion, with an increase of 89.8% over the same period last year. This helped IoT segment to be the most emerging segment in Xiaomi's business ecosystem. Among which, the contribution of the rapid growth of smart TV sales is most pronounced, according to the Earnings.

What the pride of Xiaomi might be, more than the total revenue, would be the number of users with more than five Xiaomi IoT devices (excluding smartphones and laptops) was nearly 1.98 million, an increase of 16.5% from the previous quarter. The IoT ecosystem is being built.

Internet Services: CNY 4.7 billion revenue, with a growth of 85.5%

Benefited from the increase of China Mainland consumers' willingness to pay, the revenue of the Internet service segment increased by 85.5% year-on-year to CNY 4.7 billion. With the optimization of recommendation algorithm, users kept using Xiaomi's Internet services, and with the pre-installed apps, the advertising revenue increased by 109.8% year-on-year to CNY 3.2 billion; and revenue from Internet value-added services increased by 49.7% year-on-year to CNY 1.5 billion.

International market: CNY 22.3 billion revenue, 43.9% of Xiaomi's total revenue

Xiaomi's 2018 Q3 revenues from both China and the international market had increased. The revenue from mainland China increased by 20.9% year-on-year to RMB 28.5 billion, while international market revenue increased by 112.7% year-on-year to RMB 22.3 billion, which numbers indicate a 5-times higher increase in the international market than the domestic one.

As a result, in this quarter, the international market had already accounted for 43.9% of Xiaomi's total revenue.

- Author: ZHANG Fan; Write to ZHANG Fan at ZhangFan@EqualOcean.com

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