Xiaomi reported its third straight quarterly profit decline, with adjusted net income down about 43% to 6.22bn yuan ($922mn) as a global memory chip shortage drove up component costs. Revenue fell 6.1% to 108.9bn yuan, missing forecasts, while smartphone shipments dropped 26% to 31.2mn units and gross margin narrowed to 8.5%. Suppliers like Samsung and SK Hynix have shifted production toward AI-focused chips, tightening supply of conventional memory used in phones. Xiaomi's low-cost phone mix made it more exposed than rivals. The company is leaning on its EV business, which grew, and framed its AI spending as a long-term investment with no rush to monetize.
Table of contents
The memory crunch did the damageInvestors are still betting on a recoveryElectric vehicles carry more of the load‘In no rush’ on AIQuestions this post answers
Why did Xiaomi's profit drop so much in its latest quarter
Xiaomi's adjusted net income fell about 43% to 6.22bn yuan ($922mn) mainly due to a global memory chip shortage that raised smartphone component costs, combined with intensified industry competition. Revenue dropped 6.1% to 108.9bn yuan, missing analyst forecasts of 112.2bn yuan, while smartphone shipments fell 26% to 31.2mn units. Track how supply chain shifts ripple through tech industry earnings on daily.dev.
Why is there a global memory chip shortage affecting phone makers
Leading memory suppliers such as Samsung and SK Hynix have shifted production capacity toward advanced chips used in AI data centers, squeezing the supply of conventional memory chips used in smartphones and driving up prices. This has hit Xiaomi especially hard since over half its phones sell for under $200, making it more sensitive to rising component costs than other top-five brands. Developers weighing hardware and component trends can follow chip supply news on daily.dev.