Xiaomi Q2 report: smartphone sales are down as the average selling price goes up

Xiaomi has reported a revenue of CNY 108.9 billion ($16.2 billion) for Q2 2026 – this is with a gross profit margin of 19.8% and an adjusted net profit of CNY 6.2 billion ($919 million).

Revenue breakdown for Xiaomi’s Q2: smartphones & AIoT vs. EVs, AI and others

Most of that came from smartphones and AIoT devices – CNY 84.0 billion. This division reported a gross profit margin of 20.0%. The Smart EV, AI and Other New Initiatives division brought in CNY 24.9 billion with a gross profit margin of 19.2%. Mind you, the EV division lost money this quarter – you can find more details on the financial situation of Xiaomi’s EV division here. Here we will focus on smartphones.

The smartphones and AIoT category can be broken down further. Smartphones on their own brought in CNY 42.1 billion, while IoT and Lifestyle Products brought in CNY 31.3 billion.

A breakdown of revenue by different product categories

Xiaomi smartphones reached a record high Average Selling Price (ASP) of CNY 1,351 – this converts to $200. The premium smartphone segment reached around a third of all Xiaomi phones sold in Mainland China (32.1%).

Xiaomi phones reach a record high ASP, premium models become more popular

The company is spending massive amounts of money on Research & Development (R&D) – it has already spent CNY 18.2 billion this year ($3.7 billion) and forecasts a total spend of over CNY 40 billion for this year ($5.9+ billion). Nearly half of Xiaomi employees (47.2%) work in R&D.

Some of them are working on training AI models and Xiaomi’s MiMo-V2.5 LLM was used to generate 10.5 trillion tokens in the week starting on July 20, which ranked it #1 globally.

This AI model is a major part of HyperOS 4 as well. The new version (which is currently in beta) will feature advanced memory preloading and will significantly reduce dropped frames when playing video (down 28.9%).

Xiaomi is the #3 smartphone maker globally – it has been for 24 consecutive quarters. This Q2 in particular, it shipped 31.2 million phones for an 11.5% market share. However, these shipments are down 26.3% from the year-ago quarter.

Xiaomi smartphone shipments in Q2

Here’s a look at Xiaomi’s smartphone shipments and market share over the last several quarters:

Xiaomi smartphone shipments and market share between Q2 2025 and Q2 2026

A more regional breakdown shows that Xiaomi is in the Top 3 in most places save for India where it ranked #4. It’s #2 in Latin America, the Middle East and Southeast Asia and #3 in Europe and Africa.

A regional breakdown of Xiaomi’s market share

Sales in Mainland China dropped to 8.4 million units (14.2% market share) in Q2 2026, compared to 10.3 million (14.4% market share) in Q1 2026 and 11.5 million in Q2 2025 (16.8% market share).

Moving on to tablets, Xiaomi is ranked #4 both globally and in Mainland China. Shipments this quarter declined 6.8% to 2.8 million tablets.

Global shipment numbers for Xiaomi tablets

The company remains strong in the wearable and TWS markets, it’s ranked #2 globally and in Mainland China for both categories.

Source (PDF)