Xiaomi opened down 1.9% this morning, with its automotive business recording quarterly profits for the first time, but industry competition may become increasingly fierce

Xiaomi Corporation-W (01810.HK) opened down 1.91% today, trading at HKD 40, a drop of 1.91%, with a transaction volume of 12.6285 million shares, involving HKD 509 million.

Xiaomi Corporation announced its third-quarter results for the period ending September this year yesterday, with revenue of RMB 113.121 billion, an annual increase of 22.3%, surpassing the median forecast of RMB 112.417 billion from 16 brokerages. Gross profit increased by 37.4% year-on-year to RMB 25.936 billion. Net profit reached RMB 12.271 billion, an annual increase of 129.3%, exceeding the forecast range of RMB 8.939 billion to RMB 10.941 billion from 9 brokerages; earnings per share were 47 cents.

On a non-International Financial Reporting Standards (non-IFRS) basis, the adjusted net profit for the third quarter increased by 80.9% year-on-year to RMB 11.311 billion, setting a new historical high, and outperforming the forecast range of RMB 9.51 billion to RMB 10.557 billion from 15 brokerages, with a median of RMB 10.065 billion.

In the last quarter, Xiaomi delivered 108,800 new vehicles, an annual increase of 33.8%, setting a new historical high. Xiaomi's automotive business recorded quarterly profitability for the first time, with profits of approximately RMB 700 million.

Company president Lu Weibing stated that the target of 350,000 vehicles set at the beginning of the year is expected to be achieved within this week. The situation in the fourth quarter is expected to remain stable, but due to policy factors and increasing industry competition, it is anticipated that the gross profit margin for automobiles will decline next year