Xiaomi’s Crossroads: Record Performance Meets Leadership Shakeup

The Chinese technology giant Xiaomi presents investors with a complex puzzle. While the company delivers exceptional quarterly results that shattered expectations, it simultaneously faces the departure of a key retail architect. This convergence of strength and uncertainty creates a challenging landscape for market participants evaluating the company’s prospects.

Financial Performance Defies Market Challenges

Xiaomi’s third-quarter financial report demonstrates remarkable resilience in a competitive environment. Revenue surged by 30.5% year-over-year to reach RMB 92.5 billion, significantly outperforming projections across the technology sector.

The company’s strategic pillars show diversified strength:

• The core Smartphone × AIoT division remains foundational, generating RMB 82.8 billion in revenue
• Electric vehicles emerge as a substantial growth driver with 39,790 SU7 models delivered
• Internet services achieve impressive metrics with 77.5% gross margin and 18.3% international expansion

President Lu Weibing highlighted manufacturing milestones, noting “We surpassed the significant threshold of 100,000 vehicles produced in November.” The company subsequently raised its annual delivery target to 130,000 units, signaling strong momentum in the competitive electric vehicle segment.

Leadership Transition Raises Strategic Questions

Amidst these positive financial developments, Xiaomi announced the departure of Ma Ji, Vice President and founding architect of the New Retail Division, after more than ten years with the company. This executive change comes at a pivotal moment in the company’s retail expansion strategy.

Should investors sell immediately? Or is it worth buying Xiaomi?

Xiaomi’s ambitious retail roadmap includes:

• Growing from 14,000 to 15,000 stores by year-end
• Further expansion to 20,000 retail locations throughout 2025
• Strategic relocation to premium sites with larger retail footprints

The timing of this leadership transition raises questions about execution continuity during a critical expansion phase.

Strategic Evolution and Market Position

Xiaomi is undergoing its most significant transformation since inception, evolving from a smartphone manufacturer to an integrated ecosystem provider under its “Human × Car × Home” vision. Recent product launches—including the Xiaomi 15 series featuring HyperOS 2 and the premium SU7 Ultra electric sedan—demonstrate a deliberate push into higher-margin market segments.

The company possesses substantial resources to support this strategic shift, with 685.8 million monthly active users and cash reserves of RMB 151.6 billion. However, market sentiment appears conflicted as evidenced by recent stock performance:

• Strong fundamental indicators contrast with leadership instability
• Core business growth continues alongside explosive expansion in new segments
• Aggressive retail expansion proceeds as experienced executives depart

After a strong start to the year, Xiaomi shares have experienced notable correction, reflecting investor uncertainty about whether the company stands at the brink of renewed growth or management-driven volatility. This interplay of record performance and personnel risk positions Xiaomi as one of the technology sector’s most compelling investment stories.