Xiaomi’s sales grow 33pc, is that disappointing?

2 Jul 2015

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Chinese company Xiaomi has reported that it sold 34.7m smartphones in the first half of 2015, up a third on last year. Those figures look excellent, however, not everyone is impressed.

Xiaomi is a new fish in the smartphone pond, but its growth has been remarkable. In its five-year existence it has grown to a valuation of around US$45bn, with actual sales of around 56m devices last year, according to Gartner.

It has dominated the lower end of the Android market, entering the list of top five phone sellers last year, despite its market being limited to just Asia.

In Q3 last year Xiaomi was ranked as high as third on IDC’s list of vendors, “thanks to a solid demand within its home country of China and a steady release of new devices, including the Mi4 LTE”.

However, hopes were that it could near-double its sales, hitting the 100m mark – the company itself claimed that it sold more than 60m devices last year.

Those hopes were subsequently revised down to 80m+, something they are falling short of with this news.

“Xiaomi has been hit by the entry of many copycats mimicking its online marketing model and cheap but high-specification handsets,” according to the Financial Times.

“However, it has been worst affected by the surging popularity of Apple’s iPhone in China.”

The fact that high-end devices are now eating into what appeared to be an endless, Asian budget device market is telling.

Earlier this week the company announced it is expanding outside of its Asian base, entering Brazil, as a way of negating the impending saturation point in its home markets.

What a way to make 33pc growth look average.

Xiaomi Mi image, via Ashish Mahaur on Flickr

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Gordon Hunt is a journalist at Siliconrepublic.com

editorial@siliconrepublic.com