Xiaomi's 2024 Q4 earnings report interpretation - Both new and old businesses are soaring

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Revenue and Gross Profit

2024Q4:

Revenue reached 109.01 billion yuan, up 48.8% year-on-year, marking the first time quarterly revenue exceeded 100 billion yuan; excluding the automotive business, revenue grew by 26.1% year-on-year.

Gross profit was 22.46 billion yuan, up 43.9% year-on-year; gross margin was 20.6%, down 0.7 percentage points year-on-year; excluding the automotive business, gross profit increased by 26%.

Full Year 2024:

Annual revenue reached 365.9 billion yuan, up 35% year-on-year, hitting a record high; excluding the automotive business, revenue was 333.15 billion yuan, up 23% year-on-year.

Annual gross profit was 76.56 billion yuan, up 33.2% year-on-year; gross margin was 20.9%, down 0.3 percentage points year-on-year; excluding the automotive business, gross profit was 70.5 billion yuan, up 22.7% year-on-year.

Whether quarterly or annual, even excluding the automotive segment, Xiaomi's traditional business segments maintained revenue and gross profit growth exceeding 20%. The core business continues to grow at over 20%, while the new automotive business is experiencing explosive growth. Xiaomi's current momentum is indeed unstoppable.

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Segment Growth Rates

2024Q4:

Total revenue: 109.01 billion yuan, up 48.8% year-on-year.

Smartphone revenue: 51.31 billion yuan, up 16.0% year-on-year.

AIoT revenue: 30.87 billion yuan, up 51.7% year-on-year.

Internet services revenue: 9.34 billion yuan, up 18.5% year-on-year.

Automotive & innovation business revenue: 16.66 billion yuan.

Full Year 2024:

Total revenue: 365.9 billion yuan, up 35.0% year-on-year.

Smartphone revenue: 191.8 billion yuan, up 21.8% year-on-year.

AIoT revenue: 104.1 billion yuan, up 30.0% year-on-year.

Internet services revenue: 34.1 billion yuan, up 13.3% year-on-year.

Automotive & innovation business revenue: 32.7 billion yuan.

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Segment Gross Profit

2024Q4:

Total gross profit: 22.45 billion yuan; gross margin: 20.6%, down 0.7 percentage points year-on-year.

Smartphone gross profit: 6.18 billion yuan; gross margin: 12%, down 4.4 percentage points year-on-year.

AIoT gross profit: 6.34 billion yuan; gross margin: 20.5%, up 6.6 percentage points year-on-year.

Internet services gross profit: 7.14 billion yuan; gross margin: 76.5%, up 0.8 percentage points year-on-year.

Automotive & innovation business gross profit: 3.41 billion yuan; gross margin: 20.4%.

Full Year 2024:

Total gross profit: 76.6 billion yuan; gross margin: 20.9%, down 0.3 percentage points year-on-year.

Smartphone gross profit: 24.3 billion yuan; gross margin: 12.6%, down 2 percentage points year-on-year.

AIoT gross profit: 21.1 billion yuan; gross margin: 20.3%, up 4 percentage points year-on-year.

Internet services gross profit: 26.1 billion yuan; gross margin: 76.6%, up 2.4 percentage points year-on-year.

Automotive & innovation business gross profit: 6.1 billion yuan; gross margin: 18.5%.

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Net Profit and Free Cash Flow

Note: Due to Xiaomi's significant external investments, core net profit is calculated as (gross profit - expenses) - income tax (calculated at an 18% tax rate in this article), which better reflects the profitability of Xiaomi's core business. Additionally, given the volatility of free cash flow in manufacturing, free cash flow is provided for reference only.

2024Q4:

Core net profit: 4.76 billion yuan, up 110.6% year-on-year; profit margin: 4.4%, up 1 percentage point year-on-year; free cash flow: 20.38 billion yuan.

Full Year 2024:

Core net profit: 17.65 billion yuan, up 53.5% year-on-year; profit margin: 4.8%, up 0.6 percentage points year-on-year; free cash flow: 28.78 billion yuan, down 14.4% year-on-year.

Based on a core net profit of 17.65 billion yuan and Xiaomi's current market capitalization of 1.45 trillion HKD, the static P/E ratio is approximately 76x, which is very high. However, if all business segments continue to grow rapidly, the high P/E ratio could be quickly digested. For example, if profits grow by 50% in 2025 to around 30 billion HKD, the P/E ratio would drop to about 48x.

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Device Data

Overall Data:

Monthly active devices: 702.3 million, up 61.1 million year-on-year, a 9.5% increase.

Monthly active devices in China: 172.9 million, up 17.3 million year-on-year, an 11.1% increase.

Mi Home MAU: 100.8 million, up 15 million year-on-year, a 17.5% increase.

Total AIoT connections: 904.6 million, up 165 million year-on-year, a 22.3% increase.

Xiao AI Assistant MAU: 137.1 million.

Other Data - Smartphones:

2024 smartphone sales: 168.5 million units, up 23 million year-on-year, a 15.7% increase; global smartphone market share ranked third at 13.8%.

2024 premium smartphone shipments (priced above 3,000 yuan) accounted for 23.3%, up 3 percentage points year-on-year; in the 4K-5K price segment, domestic market share was 24.3%, ranking first; in the 5K-6K price segment, market share was 9.7%, up 1.3 percentage points year-on-year.

In 2024, Xiaomi ranked among the top three in smartphone sales in 56 countries and regions globally and among the top five in 69 countries and regions. Market shares in Africa, Southeast Asia, and the Middle East were 11.3%, 16.1%, and 18.6%, respectively.

2024 average smartphone selling price: 1,138 yuan, a record high, up 5.2% year-on-year.

2024 offline retail stores in China: 15,000; offline channel smartphone shipments accounted for 10.3% of domestic sales, up 1.9 percentage points year-on-year.

Other Data - AIoT:

2024 air conditioner shipments: over 6.8 million units, up over 50% year-on-year.

Refrigerator shipments: over 2.7 million units, up 30% year-on-year.

Washing machine shipments: over 1.9 million units, up 45% year-on-year.

Tablet shipments globally: up 73.1% year-on-year, ranking fifth globally and third in China.

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Other Information

Electric Vehicles:

Q4 adjusted net loss for the automotive & innovation business: 700 million yuan; 2024 adjusted net loss for the automotive & innovation business: 6.2 billion yuan.

As of December 31, 2024, Xiaomi SU7 series first-year deliveries reached 136,854 units, with an ASP of 234,500 yuan.

As of December 31, 2024, 200 automotive retail stores were opened in 58 cities.

Other Information:

Cash reserves: 175.1 billion yuan; total borrowings: 30.6 billion yuan; net cash: 144.5 billion yuan.

2024 share repurchases: 249 million shares, costing 3.7 billion HKD, with an average repurchase price of 14.86 HKD.

Investments in 430 companies, with a total book value of 68.3 billion yuan.

Total employees: 43,688, with 41,492 based in mainland China (primarily in Beijing) and the rest mainly in India. Total compensation: 22.9 billion yuan; average compensation: 552,000 yuan.

2024 R&D expenditure: 24.1 billion yuan, up 25.9% year-on-year; R&D staff: 21,190, accounting for 48.5% of total employees.$XIAOMI-W(01810.HK) $Tesla(TSLA.US) $Li Auto(LI.US)