Xiaomi's Car, AI Business Likely Pressured in 3Q — Market Talk

What happened

Deutsche Bank's Bin Wang estimated Xiaomi's smart EV, AI and other new initiatives revenue fell 4% on quarter to 23.8 billion yuan in 3Q, with flat vehicle deliveries. Xiaomi guided 2026 corporate research and development spending of 40 billion yuan, including 16 billion yuan for smart EV and AI.

Confirmed

Global impact / market context

Falling quarterly revenue in Xiaomi's newer businesses, combined with heavy research and development spending, can reduce profit per sale and cash available for other uses. That pressure may make investors question how quickly the car and AI units turn spending into revenue and results.

Analyst inference

Deutsche Bank keeps a buy rating with a HK$48.00 target price, while shares last traded at HK$28.74, suggesting the analyst sees upside despite near-term pressure. The gap implies investors are weighing costly new-business spending against the stock's current trading level.

Analyst inference

What to watch

1. Xiaomi guided 2026 corporate research and development expenses of 40 billion yuan, including 16 billion yuan for smart EV and AI, which means spending plans are already set by the company. Confirmed
2. Watch whether vehicle deliveries stay flat or grow, because flat deliveries contributed to lower estimated segment revenue and would shape future revenue from the car business. Analyst inference
3. Track the gap between the HK$48.00 target price and the HK$28.74 last-traded price as a signal of how investors judge the spending burden against potential returns. Proposed

Evidence

• Original source link unavailable