Xiaomi generated 23.9 billion yuan ($3.5 billion) in EV revenue during the second quarter of 2026, up 15.9% from a year earlier and 25.8% from the first quarter, according to earnings results reported on Tuesday.
The figure made up the bulk of the broader ‘Smart EV, AI and Other New Initiatives’ segment, which posted 24.9 billion yuan ($3.7 billion) in total revenue.
Segment revenue rose 17.1% year-on-year and 25.3% quarter-on-quarter, reflecting a sequential acceleration after the first quarter’s 6.9% year-on-year growth.
The tech company’s group revenue exceeded 100 billion yuan for the quarter, reaching 108.9 billion yuan ($16.2 billion), with adjusted net profit at 6.2 billion yuan ($919.8 million).
ASP Declines
The average selling price per vehicle fell to 229,312 yuan ($34,000), down 9.6% from 253,700 yuan a year earlier and 2.5% from approximately 235,000 yuan in the first quarter.
Xiaomi attributed the decline to a lower share of deliveries from the higher-priced SU7 Ultra, the performance variant that carried a premium above the standard SU7 lineup when it launched in 2025.
The second-generation SU7, launched in March at a starting price of 219,900 yuan ($32,600), also sits below the previous generation’s equivalent Ultra trim, contributing to the downward pressure.
The ASP trajectory marks a reversal from 2025, when pricing trended upward on the back of the SU7 Ultra launch and strong demand for the YU7 SUV.
Co-founder and CEO Lei Jun has ruled out entering the sub-100,000 yuan segment for at least five years, citing hardware costs above 20,000 yuan ($3,000) per vehicle for intelligent cockpit and driver-assistance systems alone.
The company’s planned 2026 lineup spans about 200,000 to 550,000 yuan ($29,700–74,200), keeping its ASP well above most domestic competitors.
The declining ASP is a function of mix within that premium band — not a strategic shift downmarket.
Margin Compression Continues
Gross margin at the segment fell to 19.2% from 26.4% a year earlier and 20.1% in the first quarter.
Beyond the mix shift away from the SU7 Ultra, Xiaomi cited higher prices for core components and increased costs associated with the AI business.
The margin erosion pushed the segment back into the red.
Operating loss was 2.6 billion yuan ($386 million), narrowing from 3.1 billion yuan in the first quarter but contrasting sharply with 2025, when the segment posted its first quarterly profit in the third quarter and its first full-year operating profit.
Operating expenses climbed to 7.4 billion yuan from 5.9 billion yuan a year earlier, a 25.7% increase.
Group research and development spending rose 18.9% to 9.2 billion yuan, driven primarily by investment in AI infrastructure.
Capital expenditure reached approximately 3.6 billion yuan during the quarter, of which 2.4 billion yuan went to the new initiatives segment.
Deliveries vs Revenue per Unit
Xiaomi delivered 104,199 vehicles in the second quarter, up 28.2% year-on-year and 28.9% from 80,856 in the first quarter.
The sequential jump reflected the recovery from a disrupted first quarter, when the switchover to the second-generation SU7 cratered January and February volumes to 1,133 and 218 units, respectively.
Delivery growth outpaced revenue growth, a direct consequence of the falling ASP.
Vehicle revenue per unit dropped to around 229,400 yuan from about 253,700 yuan a year earlier, when the SU7 Ultra commanded a larger share of the order book.
Retail sales of passenger vehicles across China fell 22% over the same period, making Xiaomi‘s volume growth a relative outlier.
Cumulative deliveries of the SU7 series surpassed 500,000 units as of August 17 — 28.5 months after the sedan first went on sale.
Including the YU7 SUV, total cumulative deliveries now exceed 760,000 vehicles.
The SU7 ranked first in sales among pure electric models priced above 200,000 yuan in the Chinese mainland during the first half of 2026.
The milestone masks a sharp deceleration in the SU7’s monthly pace.
Through the first seven months of 2026, the sedan accumulated 101,540 deliveries, a 43.6% drop from the same period in 2025.
The YU7 has taken a larger share of volume, accounting for 114,782 deliveries versus the SU7’s 101,540, or 53.1% of total output.
Sky Nomad and the Annual Target
The earnings arrive as Xiaomi prepares to broaden its revenue base with the Sky Nomad extended-range SUV series, unveiled in July alongside the Kunlun Technology Architecture.
The series is Xiaomi‘s first departure from fully electric powertrains since entering the auto industry with the SU7 in 2024.
Pre-sales prices for the seven-seat N90 Max and the five-seat N70 Max are 299,900 yuan ($44,500) and 259,900 yuan ($38,600), respectively.
Both are top-specification trims, with standard and Pro versions expected to follow at lower price points. Deliveries are scheduled to begin in September.
Chinese outlet Cailian reported in early August that pre-orders may have exceeded 100,000 units, though the estimate was not based on official data.
Converting reservations into deliveries depends on how quickly Xiaomi ramps production at its Beijing plant, which received regulatory clearance to build extended-range vehicles only in June.
July deliveries came in at 31,267 vehicles, up just 2.7% year-on-year but down 10.0% from June.
Deliveries in the January-to-July period totaled 216,322 units, up 14.8% year-on-year.
Xiaomi needs to average approximately 66,700 vehicles per month over the remaining five months to meet its full-year target of 550,000 units — more than double July’s figure and well above the all-time monthly peak of 50,212 set in December 2025.
Reaching that number hinges on the Sky Nomad ramp. Overseas sales are not expected until the second half of 2027.
