Xiaomi in Q1 2020; overseas market accounts for half of total revenues

In Q1 2020, Xiaomi’s total revenue for the period reached RMB49.7 billion, representing an increase of 13.6% year-over-year. Adjusted net profit for the period was RMB2.3 billion, an increase of 10.6% year-over-year. Benefiting from the continued expansion in our global smartphone market share, the monthly active users (“MAU”) of MIUI increased to 330.7 million, an […]

Xiaomi in Q1 2020; overseas market accounts for half of total revenues

In Q1 2020, Xiaomi’s total revenue for the period reached RMB49.7 billion, representing an increase of 13.6% year-over-year. Adjusted net profit for the period was RMB2.3 billion, an increase of 10.6% year-over-year.

Benefiting from the continued expansion in our global smartphone market share, the monthly active users (“MAU”) of MIUI increased to 330.7 million, an increase of 26.7% year-over-year.

As of March 31, 2020, the number of connected IoT devices (excluding smartphones and laptops) on Xiaomi IoT platform reached 252.0 million, an increase of 42.6% year-over-year.

Xiaomi AI assistant Xiao Ai had 70.5 million MAU in March 2020, an increase of 54.9% year-over-year.

Revenue from its internet services segment in Q1 2020 increased by 38.6% year-over-year to RMB5.9 billion, accounting for a record high of 11.9% of its total revenue. Revenue from overseas markets in Q1 2020 totaled RMB24.8 billion, an increase of 47.8% year-over-year, for the first time, accounting for half of its total revenue.

According to Canalys, Xiaomi smartphone shipments in Western Europe increased by 79.3% year-over-year and it attained the largest market share in Spain for the first time.

Xiaomi Smartphone

In Q1 2020, revenue from Xiaomi’s smartphone segment totaled RMB30.3 billion, an increase of 12.3% year-over-year. It shipped 29.2 million units of smartphones in Q1 2020, an increase of 4.7% year-over-year.

According to Canalys, in the first quarter of 2020, Xiaomi ranked 4th globally in terms of smartphone shipments, and Xiaomi’s market share rose to 11.1%. Xiaomi was one of only two of the top five smartphone companies worldwide to maintain year-over-year growth in shipments.

In February 2020, Xiaomi launched Mi 10 and Mi 10 Pro. Shipments of Mi 10 and Mi 10 Pro exceeded 1 million units two months after their launch, enabling the Xiaomi brand to further strengthen its position in the premium smartphone market.

Mi 10 and Mi 10 Pro were launched overseas in late March with prices starting at €799 and €999, respectively. Boosted by Xiaomi’s premium smartphone models, the average selling price (“ASP”) of Xiaomi’s smartphones increased by 7.2% year-over-year in Q1 2020.

The ASP of Xiaomi’s smartphones in mainland China and overseas markets increased by 18.7% and 13.7% year-over-year respectively.

In April 2020, Xiaomi launched Mi 10 Lite Zoom Edition to target the younger consumer segments. With prices starting at RMB2,099, it features a 50x periscope telephoto lens camera and other advanced technologies. Mi 10 Lite 5G was launched in March 2020 in overseas markets, with prices starting at €349.

The Redmi brand continued to introduce highly competitive products at different price points. In March 2020, Redmi launched its flagship K series Redmi K30 Pro and Redmi K30 Pro Zoom Edition, sporting premium features including the Snapdragon 865 processor, LPDDR5, and UFS 3.1, while also featuring a pop-up camera, allowing Xiaomi’s customers to enjoy a full flagship experience at a reasonable price.

On the back of the highly popular Redmi Note 8 series, the second best-selling smartphone model globally in Q1 2020 according to Canalys, Xiaomi launched Redmi Note 9S and Redmi Note 9 Pro in overseas markets, carrying on the ultimate price-performance value proposition of the Redmi brand.

In April 2020, Xiaomi released MIUI 12, the latest version of Xiaomi’s smartphone operating system. Equipped with Xiaomi’s proprietary Mi Light Cone Animation Framework, MIUI 12 offers remarkable animation and a stunning visualized user interface.

In addition, MIUI 12 has introduced a privacy and data protection framework, which enables users to have full visibility of sensitive data retrieval, take control over app permissions, and mask their identity information to remain incognito. MIUI 12 is the world’s first mobile operating system to pass the TÜV Rheinland “Enhanced Privacy Protection for Android Systems” test.

Xiaomi IoT

Xiaomi Smart TV

In Q1 2020, revenue from Xiaomi’s IoT and lifestyle products segment was RMB13.0 billion, increase of 7.8%. Xiaomi’s smart TV business continued to maintain its leading position in both mainland China and overseas markets.

In Q1 2020, despite the overall decline in TV shipments globally due to the pandemic, Xiaomi’s global shipments of smart TVs still increased by 3.0% year-over-year to 2.7 million units.

According to All View Cloud (“AVC”), in Q1 2020, Xiaomi’s TV shipments in mainland China ranked 1st for five consecutive quarters and our global TV shipments ranked among the top five.

In March 2020, Xiaomi launched Redmi Smart TV Max 98”, priced from RMB19,999 (about US$2,815), significantly lower than other ultra-large TVs, bringing high-end TVs to the mass market.

In Q1 2020, Xiaomi continued to expand Xiaomi’s IoT product portfolio and promote the interconnectivity of Xiaomi’s AIoT platform.

In February 2020, Xiaomi introduced Mi AIoT Router AX3600, a WiFi 6 enabled AIoT router, which greatly improves upstream and downstream network speeds, making Xiaomi the first brand in China to support WiFi 6 technology from terminals to routers.

In addition, Xiaomi also launched Mi 65W Fast Charger with GaN Tech, Redmi Smart Display 8” and Mi Bluetooth Speaker with Wireless Charging, all of which enjoyed widespread popularity.

The sales of Xiaomi’s routers increased by 124.0% year-over-year in Q1 2020 and according to AVC, ranked 2nd in mainland China in terms of online router shipments. Sales of Xiaomi’s Xiaomi TWS Earphones, Mi Band, Mi Electric Scooter and Mi Robot Vacuum Cleaner increased by 619.6%, 56.0%, 40.7% and 40.0% year-over-year, respectively.

According to Canalys, Xiaomi ranked 1st in terms of wearable band shipments and 3rd in terms of True Wireless Stereo (“TWS”) earbuds shipments globally in 2019. According to iResearch, Xiaomi also ranked 1st in terms of electric scooter shipments globally in 2019.

Xiaomi Internet Services

In Q1 2020, revenue from Xiaomi’s internet services segment reached RMB5.9 billion, representing an increase of 38.6% year-over-year, accounting for a record high of 11.9% of Xiaomi’s total revenue.

User activity and time spent on Xiaomi’s devices increased in Q1 2020. In March 2020, the MAU of MIUI increased by 26.7% year-over-year to 330.7 million, while the mainland China MAU of MIUI reached 111.5 million.

In Q1 2020, advertising revenue was RMB2.7 billion, an increase of 16.6% year-over-year.

In Q1 2020, online gaming revenue increased by 80.5% year-over-year to RMB1.5 billion, mainly due to the fast-growing online gaming market in mainland China and higher online gaming average revenue per user from Xiaomi’s premium smartphone users.

In Q1 2020, internet services revenue outside of advertising and gaming from mainland China smartphones, including those generated from the Youpin e-commerce platform, fintech business, TV internet services and overseas internet services, increased by 71.5% year-over-year and accounted for 38.1% of Xiaomi’s total internet services revenue.

Xiaomi’s Youpin e-commerce platform continued to broaden its offerings and provide uninterrupted services to customers. The number of new users increased significantly in Q1 2020, laying a strong foundation for further expansion.

In March 2020, MAU of Xiaomi’s smart TVs and Mi Box reached 30.4 million, representing an increase of 46.8% year-over-year. As of March 31, 2020, the number of paid subscribers increased by 53.7% year-over-year to 4.3 million.

In Q1 2020, the MAU of Mi Browser on Xiaomi smartphones in the aggregated overseas market ranked 1st among all browsers. These initiatives increased Xiaomi’s average revenue per user in the overseas market.

Introduction to Xiaomi’s e-commerce platform Youpin

Source : China Internet Watch More   

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Understanding the EU–Vietnam Free Trade Agreement

Author: Ha Hai Hoang, Hanoi National University of Education In February, the European Parliament adopted the EU–Vietnam Free Trade Agreement (EVFTA). This is the most comprehensive and ambitious EU trade agreement with a developing country. Since failing to negotiate an EU–ASEAN trade agreement, the European Union and Vietnam turned to extensive bilateral negotiations to reach […]

Understanding the EU–Vietnam Free Trade Agreement

Author: Ha Hai Hoang, Hanoi National University of Education

In February, the European Parliament adopted the EU–Vietnam Free Trade Agreement (EVFTA). This is the most comprehensive and ambitious EU trade agreement with a developing country. Since failing to negotiate an EU–ASEAN trade agreement, the European Union and Vietnam turned to extensive bilateral negotiations to reach a trade deal of their own. Once it is ratified by Vietnam’s National Assembly in May, the EVFTA will open up huge opportunities for businesses and consumers.

The EVFTA will be Vietnam’s next big step in international economic integration since joining the World Trade Organization. It will serve as a catalyst for institutional reforms, economic growth and social development. The deal will drive Vietnamese exports and help the country to diversify its international markets. The European Union will remove 86 per cent of tariffs currently levied on Vietnamese goods. This is equivalent to 70 per cent of Vietnam’s revenue from its exports to the European Union. It is the biggest commitment made by a trading partner with Vietnam to reduce trade restrictions. Lower tariffs on EU-bound Vietnamese goods will give Vietnam an advantage over ASEAN competitors and China.

Vietnam’s Ministry of Planning and Investment (MPI) estimates that by 2030 the EVFTA will increase Vietnamese exports to the European Union by 44 per cent. It also forecasts an increase in the country’s economic growth by 7–8 per cent in the period 2029–2033. The EVFTA is expected to give Vietnam access to important trade benefits, particularly full market-economy status. This recognition will allow for transparent dispute resolution and non-discriminatory treatment under the deal. Through the EVFTA, Vietnam will advance high quality and sustainable production in its economy to meet both domestic consumption and export demands.

European companies develop 11.8 per cent of foreign direct investment (FDI)-linked projects and contribute a share of 15.6 per cent of total FDI into Vietnam. The EVFTA will allow further EU market penetration, where it has lagged behind other major trading powers such as the United States, Japan and China. Vietnam will remove virtually all customs duties on major EU export products to Vietnam and EU investors will now be able to bid for public contracts relating to large investment projects in strategic sectors.

The deal also safeguards 169 emblematic European products and is expected to help expand EU exports to Vietnam by €8.3 billion (US$9.14 billion), annually creating 14,000 new European jobs. Business confidence in the new trade deal is also strong. Vietnam’s European Chamber of Commerce reported that 85 per cent of its members expect the EVFTA will have either a ‘significant’ or ‘moderate’ impact on their long-term business and investment plans.

The requirements, commitments and challenges that the EVFTA imposes on Vietnam are clear. Negotiations were prolonged due to contentions over social issues and pressure on Vietnam to liberalise non-tariff barriers. This included concerns over rules of origin, as well as technical and sanitary regulations. But unlike EU trade deals with African, Caribbean and Pacific countries, the EVFTA does not contain infant industry protections and requires ‘standard reciprocal bilateral safeguard measures to protect domestic producers’. Vietnam’s quarrel with the European Union over anti-dumping measures raised the sensitivity of this issue.

The EVFTA also provides for broad liberalisation of government procurement. It binds Vietnam to the most ambitious government protocols yet concerning state-owned enterprises (SOEs). These regulations go further than any previous trade agreements of which Vietnam is a signatory. It requires open public procurement for SOEs and sets up the necessary conditions to increase SOE competitiveness. The agreement also includes rules on transparency and consultations in relation to domestic subsidies. These commitments are especially remarkable given the Vietnamese government’s perception of high ‘sovereignty costs’ associated with limiting its regulatory autonomy in these sectors.

Sustainable development is also emphasised in the deal. This includes focusing on labour standards, gender equality and environmental agreements. These rules were included despite the political, socio-economic and cultural differences that caused negotiations for the EU–ASEAN free trade agreement to stall. In the EVFTA, Hanoi agreed to ratify the remaining International Labour Organization conventions on the rights to association and collective bargaining by 2023.

Article 14 of the deal on trade and sustainable development includes detailed procedures, strict conditions and schedules regarding civil society consultations. The EVFTA’s institutional set up and oversight mechanisms also require that a specialised committee on trade and sustainable development meet regularly to supervise the agreement’s implementation. This will strengthen civil society organisations (CSOs) and their role in improving the social impacts of EU–Vietnam bilateral trade. It will also raise working conditions for Vietnamese industrial workers and increase the socio-economic position of CSOs in Vietnam.

Not only will the EVFTA strengthen EU leadership in shaping global rules, it will serve as a template for EU trade negotiations with other ASEAN member states. In return, Vietnam will gain access to the EU’s large market, enabling it to further long-term economic reform and growth. For Vietnam, the deal also serves as a counterweight to China’s growing economic power and brings Vietnam closer to international economic integration. The EVFTA offers Vietnam an opportunity for economic diversification and deeper engagement with another key foreign partner while decreasing its dependence on Chinese markets and FDI.

Ha Hai Hoang is Associate Professor at the Hanoi National University of Education.

All views expressed are the author’s own and do not represent the views of any institution or affiliation.

Source : East Asia Forum More   

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