Beijing (ZXZC)- On August 21, Xiaomi Group released its financial report for the second quarter of 2024 (Q2 2024), showing a revenue of 88.9 billion yuan, which surged 32% year on year from Q2 2023's 67.4 billion yuan. The company’s adjusted net profit reached 6.2 billion yuan in the period, marking a 20.1% increase from a year ago, with cash reserves standing at 141 billion yuan.

Xiaomi SU7; photo credit: Xiaomi

Xiaomi's innovative business segment, which includes smart electric vehicles, generated 6.4 billion yuan of revenue in the period, accounting for 7.2% of the group’s total revenue, with operating expenses at 2.9 billion yuan. Specifically, Xiaomi EV sold 27,000 vehicles in Q2 this year, with an average selling price of 228,600 yuan per car.

Despite the booming sales, Xiaomi's automotive division is still unprofitable, recording an adjusted net loss of 1.8 billion yuan in Q2. Xiaomi Group President Lu Weibing attributed the losses to the small scale of the current operations, noting that achieving economies of scale is key for future profitability. Additionally, the high initial costs of Xiaomi’s first electric sedan have yet to be fully absorbed.

Currently, Xiaomi’s innovative businesses including smart electric vehicles realized a positive gross margin of 15.4% in the second quarter of this year, meaning that turning loss to profit is quite possible.

Looking ahead, Xiaomi EV is focusing on ramping up production capacity to meet market demand, with plans to deliver 100,000 units of the SU7 electric sedan series by November 2024, and aiming for an annual delivery volume of 120,000 units by year-end.