Guosheng Securities: Reiterates "Buy" rating on XIAOMI-W (01810), long-term trend unchanged, high-end promotion advancing.

Guosheng Securities released a research report, giving XIAOMI-W (01810) a target price of 52 Hong Kong dollars and reaffirming a "buy" rating. The performance in the third quarter was strong, with revenue increasing by 22.3% year-on-year to 113.1 billion yuan, and adjusted net profit reaching a new high of 11.3 billion yuan, a significant increase of 80.9% year-on-year. The growth was mainly driven by the high-end smartphone strategy and the automotive business, with Xiaomi delivering 109,000 vehicles, and the automotive and AI innovation business achieving profitability for the first time in a single quarter. The company's "people-car-home full ecology" strategy continues to advance, with over 1 billion devices connected to the AIoT platform, indicating significant long-term growth potential. Key points from Guosheng Securities: Performance Xiaomi Group achieved revenue of 113.1 billion yuan in the third quarter of 2025, a year-on-year increase of 22.3%. The revenue breakdown for the smartphone/IoT/internet/automotive and AI businesses was approximately 46 billion/27.6 billion/9.4 billion/29 billion yuan, respectively. The adjusted net profit for the quarter was approximately 11.3 billion yuan, a historical high, and an 80.9% year-on-year increase. Business aspects Smartphones: Continuing high-end push. Xiaomi shipped 43.3 million smartphones globally in the quarter, a 0.5% year-on-year increase. The company's global shipment share is about 13.6%, ranking in the top three, and about 16.7% in mainland China, ranking in the top two. In terms of high-end smartphones, sales in the quarter accounted for 24.1% of total sales in mainland China, with a market share of 18.9% in the 4,000-6,000 yuan price range. The Pro and Pro Max models in the Xiaomi 17 series accounted for over 80% of sales, further optimizing the product structure. IoT: Iterative technological intelligence. Xiaomi's tablets ranked in the top five in global shipments, TWS earphones ranked second in global shipments, and wearable wristband devices ranked first in global shipments. As of the quarter, the number of devices connected to the company's AIoT platform exceeded 1 billion, a 20.2% year-on-year increase. In September 2025, the MAU of the Mi Home APP and Xiaoai Assistant exceeded 110 million and 150 million, respectively. In October 2025, Xiaomi's smart home appliance factory started production, marking the completion of the "design-research and development-production-verification" industry loop for Xiaomi's major home appliance business. Automotive and AI Innovation Business Achieved profitability for the first time in a single quarter. Xiaomi delivered approximately 109,000 vehicles in the quarter, setting a historical high. In October 2025, the Xiaomi YU7 series ranked first in the mainland SUV sales ranking. The automotive and AI innovation business achieved operating profit for the first time in a single quarter, with operating income of about 700 million yuan. Profit forecast and rating The bank believes that in the short term, the smartphone and automotive tracks may face subsidy rhythm adjustments and changes in raw material costs. However, as a top player in the industry and with excellent high-end capabilities, Xiaomi has relative competitiveness when facing short-term disruptions in the industry environment. In the long term, Xiaomi's "people-car-home full ecology" strategy has significant advantages. In September 2025, with the launch of Xiaomi-MiMo-Audio, Xiaomi has introduced a full range of models matrix for language, multimodal, and voice. In November 2025, Xiaomi released the Xiaomi Miloco smart home solution, leading the exploration of a large-scale driven whole-house smart lifestyle. The bank believes that Xiaomi's multi-terminal synergy solutions are expected to lead the future hardware entry. Reaffirm a "buy" rating. The bank expects Xiaomi Group's revenue for 2025-2027 to be 470/557/694 billion yuan, with non-GAAP net profit attributable to mothers of approximately 44/50.1/65 billion yuan. Based on a 20x 2026e P/E for the company's consumer electronics main business and a 2.5x 2026e P/S for the automotive and AI innovation business, Xiaomi Group is given a target price of 52 Hong Kong dollars and a "buy" rating. Risk points Competition in smartphones exceeds expectations, storage costs rise above expectations, IoT progress falls below expectations, and competition in smart vehicles exceeds expectations.