by Josh Horwitz
SHANGHAI, (Reuters) – Xiaomi reported an 8.2% increase in third-quarter revenue, less than expected as smartphone sales growth stagnated amid increasingly intense competition from rivals.
The company said on Tuesday that sales of smartphones, from which it derives most of its revenue, rose 0.4% to 47.8 billion yuan ($7.49 billion) in the three months to 30 March. September. Quarterly smartphone shipments were down 5.8% for the year, from 46.6 million units to 43.9 million units. The company has singled out global chip shortages as the cause of the decline.
Total sales rose to 78.06 billion yuan, down from a market estimate of 79.20 billion yuan by Refinitiv.
Xiaomi, which had managed to gain market share in China after the sanction-stricken withdrawal of rival Huawei, recently lost ground not only to bestselling champions Oppo and Vivo, but also to Honor, a Huawei-derived brand.
Honor surpassed Xiaomi and reached third place in smartphone market share in China in the July-September quarter, according to Canalys.
Xiaomi also makes money by selling online ads and other types of consumer hardware. Growth in its Internet services unit, which makes money primarily from serving ads across multiple apps, increased 27% for the year.
Excluding one-off items, profit amounted to 5.18 billion yuan, roughly in line with analysts’ projections of 5.09 billion yuan.
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