Xiaomi Android Phone Half-year Results 2014 Better than the Last Full Year

Xiaomi, the Chinese smart device and mobile service provider, announced today shipment and total revenue of smartphones in the first half of 2014 that are higher than results in the whole year of 2013.

26.11 million Xiaomi Android phones were shipped in the period, with 11 million in Q1 and the rest in Q2. That’s a 271% year-over-year increase. That totals 52.3 million in shipment since 2011. The company’s annual goal for this year is 60 million.

The total revenue from phone sales in the first half of 2014 is about RMB33 billion (roughly US$5.3 bn), a 149% increase. That the growth in total revenue is slower than the total number of phones sold must reflect that fact that many more RedMi, a lower-end and much lower-cost model, were sold than the company’s flagship models which are at about twice the price than that for a RedMi.

But, again, the company doesn’t only make revenues from the hardware sales but also from MIUI, the customized Android system preloaded in all Xiaomi hardware devices and free for download. MIUI has been making revenues from advertising and paid software services.

And, MIUI has been adding offerings and users, through both Xiaomi phone sales and standalone installs. Plus, it’s in Xiaomi smart TV and smart routers, and will be in more devices by the company. The revenue growth of MIUI cannot be slower than the phone shipment.

Also, the MIUI software services are expected to be at higher margins than Xiaomi’s hardware business in the long run considering scale effect. MIUI announced 50 million users in the past May.