Chinese smartphone maker Xiaomi reported a steep drop in second-quarter revenue on Friday as the global coronavirus outbreak impacted demand for smartphones and other consumer goods. As per report the Chinese Brand Xiaomi Revenue Falls for both the reasons, one is due to COVID-19 Curbs & another for Indian Government Sanctions. Xiaomi brand has a great market in India for smartphones and gadgets. Sales plummeted 20 percent year-on-year to 70.17 billion Yuan ($10.31 billion) missing forecasts and marking a steeper fall from the previous quarter, where the company had its first ever revenue drop since listing. Profit also plunged 67 percent to 2.08 billion Yuan ($310 million), missing analyst expectations.
Reasons of Xiaomi Revenue Fall:
Chinese smartphone makers have been particularly hard hit by the virus, with unit shipments down about 10 percent year-to-date, according to researcher Canalys. But this year Chinese Brand Xiaomi Revenue Fall 20% Due to COVID-19 Curbs & Indian Government Sanctions.
Xiaomi, which generates more than half of the group’s total revenue and sells about three quarters of its phones in China, saw sales plunge 29 percent. “The strong performance in the first quarter of 2020 was driven largely by the strong launch of Mi A2,” said CEO Lei Jun.
However, we were not able to maintain our momentum in the second quarter due to the impact of the Covid-19 pandemic. Xiaomi shares have lost nearly 40 percent since the beginning of the year, hit by the slowing pace of economic expansion in China and weak overseas sales.
In India, where the company has been embroiled in controversy over alleged tax evasion, the firm has been subject to government investigations. Indian Government Sanctions is yet another cause for Xiaomi Revenue Fall. Last month, Indian tax authorities seized about $725 million in assets, claiming the firm unlawfully moved funds offshore under the guise of royalty payouts. Xiaomi has denied any wrongdoing and says it is cooperating with investigators. By contrast, Apple Inc, Samsung Electronics Co Ltd and Huawei Technologies have been relatively unscathed by the crisis.