Xiaomi’s electric vehicle division has reached a significant milestone by posting its first quarterly profit of 700 million yuan ($98 million) in the three months ended September 2025, marking a dramatic turnaround from a 300 million yuan loss in the previous quarter. This achievement positions the Chinese tech giant among the few profitable EV manufacturers globally and accelerates its ambitious goal to become one of the world’s top five carmakers.
Breaking Details
The milestone comes just 19 months after Xiaomi launched its debut SU7 electric sedan, demonstrating an exceptionally fast trajectory to profitability compared to industry peers. The company’s EV division not only reversed its previous quarter’s losses but also contributed to more than doubling Xiaomi’s overall net income for the period.
Production and Delivery Milestones
Xiaomi has exceeded expectations across multiple metrics. The company will hit its 2025 target of 350,000 EV deliveries this week, more than a month ahead of schedule. October shipments totaled over 40,000 vehicles, matching September’s impressive figures. The company celebrated its 500,000th vehicle rolling off the production line, showcasing the rapid scale-up of manufacturing operations.
Product Portfolio Expansion
Beyond the successful SU7 sedan, Xiaomi has expanded its EV lineup to include its first SUV model. Both vehicles have drawn strong market demand, with current wait times extending up to nine months for some models, indicating robust consumer interest and production constraints.
Industry Impact
Xiaomi’s achievement places it in an exclusive group of profitable Chinese EV manufacturers, setting it apart in a highly competitive market where many players continue to struggle with losses. This success comes despite significant structural challenges affecting the entire industry.
Market Positioning
The rapid profitability positions Xiaomi as a serious competitor to established players like Tesla and China’s BYD, both domestically and in international markets. The company’s plans to begin selling EVs in Europe by 2027 demonstrate its global ambitions and confidence in its technology and manufacturing capabilities.
Industry Recognition
The quality and innovation of Xiaomi’s vehicles have gained recognition from unexpected quarters. Ford CEO Jim Farley publicly praised the SU7 after driving an imported model for six months, highlighting the vehicle’s performance and technology integration. This endorsement from a major automotive industry executive underscores the rapid advancement of Chinese EV technology.
Expert Analysis
For Xiaomi co-founder and CEO Lei Jun, the early profitability serves as validation of the company’s ambitious carmaking strategy. The achievement demonstrates that Xiaomi’s approach of leveraging its technology expertise and manufacturing scale can translate effectively to the automotive sector.
Strategic Advantages
Xiaomi’s success stems from several key factors. The company’s existing expertise in consumer electronics and manufacturing has provided a solid foundation for automotive production. Additionally, its strong brand recognition and customer loyalty in the smartphone market have helped drive initial EV adoption.
Technology Integration
The company’s focus on integrating advanced AI-driven driver-assistance features and seamless connectivity with its ecosystem of devices has differentiated its vehicles in the market. This technology-first approach appeals to consumers seeking cutting-edge automotive experiences.
Market Response
The financial markets and industry analysts have responded positively to Xiaomi’s EV milestone. The achievement demonstrates that the company’s diversification strategy beyond smartphones is yielding tangible results, providing a new growth engine for the business.
Future Projections
Xiaomi now expects to deliver more than 400,000 vehicles in 2025, representing a significant upward revision from previous targets. This optimistic outlook reflects strong order books and expanding production capacity.
What This Means
Xiaomi’s EV profitability milestone has broader implications for the automotive industry and technology sector convergence. It validates the potential for technology companies to successfully enter and compete in the automotive market when they bring genuine innovation and manufacturing expertise.
Challenges Ahead
Despite the positive momentum, Xiaomi faces ongoing challenges including global memory chip shortages that increase costs across its EV and smartphone businesses. Additionally, China’s gradual phaseout of tax incentives for electric vehicle purchases could impact future demand dynamics.
Long-term Outlook
Lei Jun has signaled confidence in sustaining the momentum through increased production capacity, reduced customer wait times, and continued investment in new technologies. The company’s commitment to becoming a top-five global carmaker appears increasingly achievable given this early success.
The rapid achievement of profitability positions Xiaomi as a formidable player in the global EV market and demonstrates the potential for technology companies to successfully diversify into automotive manufacturing when they combine innovation with operational excellence.
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