Chinese consumer electronics firm Xiaomi on Tuesday reported a better-than-expected financial performance for the fourth quarter of last year, with a 21.4% rise in revenue and a 39.6% growth in profits.
In 2021, Xiaomi’s total revenue amounted to 328.3 billion yuan ($51.5 billion), an increase of 33.5% year-on-year, while revenue from overseas markets reached 163.6 billion yuan in 2021, accounting for 49.8% of the company’s total revenue. Its adjusted net profit in 2021 was 22.0 billion yuan, an increase of 69.5% year-on-year.
In the fourth quarter of 2021, its total revenue reached 85.6 billion yuan, an increase of 21.4% year-on-year, while the adjusted net profit was 4.5 billion yuan, an increase of 39.6% year-on-year.
Despite the global supply shortage of key components, Xiaomi’s smartphone business maintained solid growth momentum. In the fourth quarter of 2021, its smartphone revenue reached 50.5 billion yuan, while global smartphone shipments reached 44.1 million units. In 2021, its smartphone revenue reached 208.9 billion yuan, representing an increase of 37.2% year-on-year, and its global smartphone shipments amounted to 190.3 million units, an increase of 30.0% year-on-year. According to Canalys, its global smartphone shipments in 2021 ranked third with a market share of 14.1%.
IoT and Lifestyle Products
In 2021, Xiaomi’s IoT and lifestyle products segment maintained growth, with revenue increasing 26.1% year-on-year to 85.0 billion yuan. In the fourth quarter of 2021, revenue from IoT and lifestyle products amounted to 25.1 billion yuan, an increase of 19.1% year-on-year.
In 2021, key AIoT categories such as tablets and laptops, smart large home appliances, and wearables also continued to grow steadily. First, Xiaomi Pad 5 series’ shipments ranking in mainland China rose to fourth place in the fourth quarter of 2021, according to Canalys. According to IDC Quarterly Wearable Device Tracker (2021Q4), Xiaomi’s TWS earbud shipments ranked second globally and first in mainland China during the fourth quarter of 2021.
In 2021, Xiaomi’s internet services revenue reached 28.2 billion yuan, an increase of 18.8% year-on-year, 17.8% of which come from overseas markets. In the fourth quarter of 2021, internet services revenue reached 7.3 billion yuan, growing 17.7% year-on-year, and the gross profit margin of the firm’s internet services reached 76.1%, a quarterly high.
Xiaomi’s global internet user base continued to expand in the fourth quarter. In December 2021, the global monthly active users (MAU) of MIUI, Xiaomi’s smartphone operating system increased 28.4% year-on-year to 508.9 million, while the MAU of MIUI in mainland China grew 17% year-on-year to 129.8 million.
In 2021, the company’s gaming revenue reached 4 billion yuan, a slight decline of 5.7% year-on-year, primarily affected by the adjustment of commercial terms that began during the third quarter of 2020, which impacted annual growth in the first half of 2021, while Xiaomi returned to year-on-year growth in the second half of 2021.
Research and Development Investment
In 2021, Xiaomi announced new share incentive awards for young engineers, technology specialists, middle and senior management, and recipients of the company’s new 10-year entrepreneurship program. Additionally, the Xiaomi Million Dollar Technology Award was held for the third consecutive year, with this year’s award won by the CyberDog bio-inspired robot project team.
Xiaomi’s research and development expenses increased by 42.3% from 9.3 billion yuan in 2020 to 13.2 billion yuan for 2021, primarily due to the increase in compensation for research and development personnel. Xiaomi plans to invest more than 100 billion yuan in research and development over the next five years.
Smart Electric Vehicles
Since announcing plans to enter the smart electric vehicle business in March 2021, Xiaomi’s progress has been ahead of schedule. Currently, its smart electric vehicle research and development team exceeds 1,000 people. Looking ahead, Xiaomi will continue to expand research and development in core areas such as autonomous driving and smart cabins. Xiaomi continues to expect that mass production will officially begin in the first half of 2024.
As of December 31, 2021, Xiaomi had invested in more than 390 companies with an aggregate book value of 60.3 billion yuan, an increase of 25.7% year-on-year. In 2021, Xiaomi recorded a net gain on disposal of investments (after tax) of 3.3 billion yuan.