Xiaomi, a privately owned Chinese electronics company, is the world’s 4th largest smartphone maker. For a company that has been nicknamed China’s Apple, feels like it will making loads of money from smartphone sales. It’s not true actually.
Xiaomi was valued at $46 billion in its last fund-raising. In 2014, Xiaomi was the world’s most valuable best-selling smartphone maker.
Reduction in Smartphone Sales won’t Hit the Company : Xiaomi
According to a report published by Reuters, Xiaomi has actually experienced drop in its smartphone sales. In 2015, the company lost its global smartphones targets by 12%. In China, it’s home land, things were even worse, as smartphone sales weekend with a 45%.
It seem that the company focuses its business strategy and efforts in the hardware business. Reduction in smartphone sale for Xiaomi will not influence the company, as profit growth will be driven by sales from smart home devices as well as revenue from its software eco-system.
Xiaomi global VP Hugo Barra said:
Basically we’re giving them to you without making any money… we care about the recurring revenue streams over many years. We could sell 10 billion smartphones and we wouldn’t make a single dime in profits
To decrease production and marketing cost, company doesn’t own any physical stores. It sells its products completely from its online store. Right now the Chinese giant is investing in India and other parts of South East Asia and more recently, the US market.
Next month Xiaomi is launching its first device capable of roaming on the country’s 4G networks. The company also cleared the rumors about any impending IPO attempts and said it will not face funding shortage.
Hugo Barra said:
“There’s no pressing need to do an IPO or even a private round, We are not a flash in someone’s PR plan”
Xiaomi is different from other Chinese competitors like LeEco who have carelessly taken the market by storm. Indeed it’s planning to take step very tactfully, not rushing things into a direction it might regret. It’s seems like a pretty good and wise decision.