Last night, Xiaomi's launch event was explosive, with the YU7 pre-sale performance setting records, AI glasses expanding new ecological boundaries, and Goldman Sachs being fully optimistic about Xiaomi's performance.
According to the news from Chasing Wind Trading Desk, Goldman Sachs has been bullish on Xiaomi in several recent reports, raising the target price for Xiaomi from HKD 65 to HKD 69, maintaining a buy rating, and expecting a compound annual growth rate of 27% and 40% for revenue and net profit from 2024 to 2027, respectively.
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Goldman Sachs pointed out in the report that the YU7 pre-sale far exceeded market expectations, and from the configuration perspective, it comprehensively surpasses competing products in the same class. Its record performance will consolidate Xiaomi's leadership position in the high-end automotive market. Goldman Sachs has raised the delivery volume forecast for Xiaomi's electric vehicles from 2025 to 2027 by 1-6%.
The AI glasses mark a new chapter in Xiaomi's ecosystem, and Goldman Sachs believes that Xiaomi's entry signifies that the industry has entered a stage of competition among mainstream brands. AI glasses are expected to replicate the explosive growth trajectory of TWS headphones, with the Chinese smart glasses market expected to reach 2.9 million units by 2025, and Xiaomi's AI glasses expected to capture 10% of the market share.
In addition, the success of the YU7 also brings direct benefits to CATL, as the main battery supplier will directly benefit. Goldman Sachs expects the penetration rate of Kirin batteries to start growing again in the second half of 2025, significantly enhancing CATL's profitability. Therefore, it maintains the target price of 323 yuan for CATL's A-shares and 343 HKD for its H-shares, representing an upside of 27.8% and 5.7% from the current stock prices, respectively.
<h2>YU7 Exceeds Expectations and Strengthens High-End Market Position</h2>
The Xiaomi YU7 electric SUV was officially launched on June 26, with the order volume reaching 289,000 units in the first hour, far exceeding market expectations. This strong performance will consolidate Xiaomi's leadership position in the high-end automotive market in China.
Goldman Sachs stated that the pre-sale far exceeded market expectations, and the YU7 pricing remains highly competitive:
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Within 3 minutes of the YU7 launch, it received 200,000 orders, with 122,000 locked orders, and the total order number climbed to 289,000 within 1 hour. This performance far exceeded the previous expectation of 150,000 orders within 24 hours, showing strong consumer demand for Xiaomi's high-end SUV products.
The retail prices for the YU7 standard version, Pro version, and Max version are 253,500 yuan, 279,900 yuan, and 329,900 yuan, respectively, which is basically consistent with the expected average price of 285,000 yuan. Compared to the SU7's average tax-inclusive price of 262,000 yuan from the second quarter of 2024 to the first quarter of 2025, the YU7 pricing remains highly competitive.
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Furthermore, the YU7 has outstanding technical highlights, comprehensively surpassing competing products in the same class. Goldman Sachs stated that the YU7 outperforms competitors in terms of size space, driving performance, and range support, and will directly compete with existing high-end SUVs such as the Tesla Model Y and Li Auto L6
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The YU7 series has achieved multiple breakthroughs in technical specifications, with the standard version equipped with a 96.3kWh battery pack, achieving a CLTC range of 835 kilometers, making it the model with the longest range among pure electric SUVs with battery packs under 100kWh. The Pro and Max versions offer ranges of 760 and 770 kilometers respectively, ranking first among all-wheel-drive pure electric SUVs.
Unlike the SU7 series, where only the Max/Ultra versions are equipped with an 800V platform, the entire YU7 series comes standard with an 800V architecture. The Max version can complete a 10%-80% charge in 12 minutes, charging 620 kilometers in 15 minutes. In terms of the power system, the entire series is equipped with the upgraded HyperEngine V6S Plus rear motor, with a maximum power of 288kW and a torque of 528N·m.
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In addition, Goldman Sachs believes that the strong demand for the YU7 will support capacity expansion plans. Based on strong demand, Goldman Sachs has raised its electric vehicle delivery estimates for 2025-2027 by 1-6%, expecting deliveries of 411,000, 800,000, and 1.174 million units respectively.
<h2>AI glasses expand Xiaomi's ecological boundaries, industry expected to replicate explosive growth path of TWS headphones</h2>
At the same time, the debut of Xiaomi's AI glasses marks a further expansion of the company's ecosystem boundaries, and it is expected to occupy an important position in the rapidly growing Chinese smart glasses market.
Goldman Sachs expects that the shipment volume of Xiaomi's AI glasses will be about 200,000 units in 2025, accounting for 10% of the Chinese smart glasses market. The Chinese smart glasses market is expected to reach 2.9 million units by 2025, with smart audio glasses accounting for 2.16 million units, providing significant growth space for Xiaomi.
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Xiaomi also launched AI glasses as the next-generation portable AI terminal, with a standard version priced at 1,999 yuan. In terms of technical specifications, it weighs only 40 grams, with a battery life of 8.6 hours, which is 20% lighter and has a 40% longer battery life than Meta Ray-Ban. It is equipped with a Snapdragon AR1 processor and a 12MP camera, with integrated software functions including real-time translation in 10 languages, multimodal Q&amp;A, seamless payment, and control of the vehicle-home ecosystem.
The standard version is priced at 1,999 yuan, while the electrochromic versions are priced at 2,699 yuan and 2,999 yuan, with a competitive pricing strategy expected to accelerate consumer acceptance.
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Goldman Sachs' research report also points out that AI glasses are at a historical juncture similar to that of TWS headphones in 2017, with the potential to replicate the latter's explosive growth trajectory. With the release of Xiaomi's AI glasses, this emerging category is reaching a critical turning point.
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The Chinese AI/AR glasses market is expected to expand rapidly at a compound annual growth rate of 56%, growing from 479,000 units in 2024 to 6.962 million units in 2030, with a market size reaching $1.339 billion. This growth rate is highly similar to the 64% compound annual growth rate of TWS headphones from 2017 to 2023, indicating that AI glasses are at the critical point of technological adoption.
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In addition to Xiaomi, Alibaba, ByteDance, Amazon, and Apple are all expected to launch AI glasses products in 2025-26, forming a strong new product pipeline. Meta plans to release Oakley Meta glasses in July, priced between $399 and $499;
ByteDance's Vision+ is priced at $270, expected to be released in Q4 2025-2026; Apple's smart glasses are expected to debut in 2026.
It is worth mentioning that Goldman Sachs predicts that the revenue share of AI/AR glasses business for most supply chain companies will be below 5% in 2025, but as the market grows rapidly, this proportion is expected to significantly increase, bringing new growth momentum to related companies.
<h2>The Yu7 will drive CATL's high-end battery penetration rate recovery, and product structure improvement is expected to significantly enhance profitability</h2>
The successful launch of the YU7 brings direct benefits to CATL.
According to Goldman Sachs analysis, the official release of Xiaomi's YU7 model presents an important opportunity for CATL to improve its product structure, with the penetration rate of the high-margin Kirin battery expected to rebound in the second half of 2025. Xiaomi has become CATL's largest high-end battery customer, and this strategic partnership will significantly enhance CATL's profitability.
Xiaomi has also rapidly grown into an important customer for CATL. Data shows that Xiaomi accounted for about 10% of CATL's domestic electric vehicle battery installations in Q1 2025, a significant increase from about 4% in Q2 2024, narrowing the gap with CATL's top two electric vehicle battery customers, Tesla and Geely.
Goldman Sachs stated that the launch of the YU7 will drive the recovery of the penetration rate of CATL's high-end Kirin battery products in the second half of the year:
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Data shows that since 2024, the share of lithium iron phosphate batteries in CATL's installations has exceeded 20 percentage points, rising from 50% in Q1 2024 to about 70% in Q1 2025. Meanwhile, the penetration rate of the Kirin battery has decreased from about 15% in Q1 2024 to about 10% in Q1 2025. With the launch of high-end battery-equipped models like the Xiaomi YU7, this trend is expected to be reversed.
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Goldman Sachs further stated:
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Improvement in product structure will be a key driver of unit profit expansion for CATL, with the company's mixed unit gross profit expected to rise from RMB 152 per kWh in 2025 to RMB 169 per kWh in 2030. This improvement trend has not yet been fully recognized in the market, providing a good investment opportunity for investors.
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Based on unchanged valuation methods, Goldman Sachs maintains a target price of RMB 323 for CATL's A-shares and HKD 343 for its H-shares, representing an upside of 27.8% and 5.7% from the current stock price, respectively

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Goldman Sachs stated that the pre-sales of YU7 far exceed market expectations, and its record performance will solidify Xiaomi's leadership position in the high-end automotive market. The AI glasses open a new chapter for the Xiaomi ecosystem, with the potential to replicate the explosive growth trajectory of TWS earbuds. The Chinese smart glasses market is expected to reach 2.9 million units by 2025, with Xiaomi's AI glasses anticipated to capture 10% of the market share. The success of YU7 also brings direct benefits to CATL, as Goldman Sachs expects the penetration rate of Kirin batteries to start growing again in the second half of the year, significantly enhancing CATL's profitability

- Xiaomi's YU7 electric SUV launch exceeded market expectations, achieving 289,000 orders in the first hour, solidifying its position in the high-end automotive market.  
- Goldman Sachs raised Xiaomi's target price to HKD 69, forecasting a compound annual growth rate of 27% in revenue and 40% in net profit from 2024 to 2027.  
- The introduction of AI glasses is expected to capture 10% of the rapidly growing Chinese smart glasses market, mirroring the explosive growth trajectory of TWS headphones.

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Xiaomi Corporation

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After watching Lei Jun's press conference, Goldman Sachs raised the target prices for Xiaomi and CATL, predicting that "the current AI glasses are like the TWS headphones of 2017."