Xiaomi's sales in the Chinese market hit the brakes after a blazing start

In the first quarter of 2025, Xiaomi recorded revenues of 2.2 billion euros at the exchange rate in its electric vehicle division, an increase of 11 percent over the last quarter of 2024. However, this increase reflects a slowdown compared with previous quarters, when the division grew a spectacular 71.5 percent in the third quarter and 52.1 percent in the fourth quarter of 2024.

This slowdown is partly attributed to seasonal factors, since the first quarter in China is usually less dynamic due to festivities such as the Chinese New Year.

It should be noted, on the other hand, that Xiaomi has restructured its business units in its annual report, moving from “Smart Electric Vehicles and other innovative businesses” to also include Artificial Intelligence. This new category reported total sales of 18.6 billion yuan, with a gross profit margin of 23.2 percent, but recorded operating losses of 500 million yuan.

Given that electric vehicles contributed 18.1 billion yuan, the latter are clearly the fundamental pillar of this business unit. However, having AI advances that can be implemented in the Chinese manufacturer’s vehicles seems absolutely essential today to achieve commercial success.

In the first quarter of 2025, Xiaomi delivered 75,869 units of the SU7, 9 percent above the 69,697 units of the previous quarter. To date, more than 258,000 vehicles of this series have been delivered.

A very ambitious challenge

As we already reported some time ago here at HighMotor, Xiaomi adjusted its delivery target for 2025, from 300,000 to 350,000 vehicles. This requires an average of 87,500 deliveries per quarter. The first-quarter results are clearly below this figure, so the Chinese manufacturer will have to compensate for this situation in subsequent quarters with much higher sales. The upcoming launch of the YU7 electric SUV next July will undoubtedly help boost Xiaomi’s vehicle sales.

Overall, Xiaomi generated 111 billion yuan in the first quarter of 2025. The smartphone and AIoT businesses accounted for 83 percent of revenues, while electric vehicles, together with AI and some other categories, contributed 17 percent.