At least Xiaomi's business model is profitable. It's much better to have $50 dollars than having no dollars at all.
Actually apple takes more than 100% profit margins and similarly Samsung takes more than 50% profit margins initially. After one year they cut prices around 25% and next year they cut prices again around 40% . Next year they sale phones in half of iinitial prices still they make profits so you can imagine what is the actual prices of them and why they are expensive. Looters.
That show Xiaomi is not profiteering at all unlike some other greedy companies. Kudos to that!
Anonym, 15 Dec 2014Because this is when the company is blooming. A single misstep and that easily becomes a negat... moreMissteps matter when you price devices at the highend.. The price at which xiaomi sells devices no one will care if it bends or lags and buy it..
The only misstep it can take is running afoul with patents and such for which they can always fall back to china the safe haven..
Lead2XL, 15 Dec 2014What's wrong with a profit of $56 million? Hard to admire greedy companies that aren't happy u... moreBecause this is when the company is blooming. A single misstep and that easily becomes a negative XX Million, with the added risk of the company going belly up should another misstep follow.
It doesn't matter how you sugarcoat this, every single company is bound to make a misstep somewhere along the way. Most are able to afford it, Xiaomi clearly isn't.
Anonymous, 15 Dec 2014Xiaomi in 5 years will be the world's no.1 cell phone maker, listen to that Cook. LOLSo you brand them as the No. 1 cell maker and then become the number 1?? Stop kidding yourself.. They are nowhere close to the number 1.. Even their number 3 (or 4?) is based on only number of devices they ship.. Their after sales service is pathetic..
Xiaomi in 5 years will be the world's no.1 cell phone maker, listen to that Cook. LOL
Hats off and Salutations to Xiaomi, they make great products, sell them at startlingly low prices, yet are able to show a profit (Even though its low). Sensible People will continue to buy from this Great Company!
Xiaomi can simply increase the prices by say 10% and show a great profit(their Phones etc will still be extremely affordable).
*from india with love!
Xiaomi 's profit margin is just 2% , Samsung has 17.7% and apple has 28.7 % . Their actual production cost are almost same .
Based on this short and somewhat surprising report my opinions are this
1 The 1.3% purchase of Media Group Co is to generate a revenue stream
2 The 2% operating profit is unsustainable so expect prices to rise
3 Xiaomi cannot afford to lose the market in India or have it "closed" by this injunction
4 Xiaomi will have to pay all royalties to Ericsson this will mean that the 2013 accounts will after adjustment show a loss
5 Contrast this with Samsung who have experienced a profit fall and NOT a loss. The cut throat Xiaomi pricing means that Xiaomi is selling phones for less than cost!
6 Xiaomi have no money for investment or expansion at the current prices as it owes Ericsson for every phone sold already and any future sales
Xiaomi are offering the highest (mid range) specs at the lowest cost, which multi-nationals cannot compete this shows that Xiaomi cannot continue at the current price
If you exclude Xiaomi pricing of similar specs phones are realistically priced, the goal is to be profitable and Xiaomi are not
I liked Xiaomi as it kept others in check, ONLY Xiaomi will raise prices in the near future
Lead2XL, 15 Dec 2014What's wrong with a profit of $56 million? Hard to admire greedy companies that aren't happy u... moreIf they had a better profit maybe they would give a better after sales?
No thank you sir.. Next year i will buy a device from a company that won't ask me to wait for two and half months for a screen replacement..
What's wrong with a profit of $56 million? Hard to admire greedy companies that aren't happy unless they are ripping you off, charging as much as they can get away with. Let's all buy Xiaomi devices next year.
Increase 5% of selling price, would result in 10% increase in net profit. Xiaomi Business is very profitable. As for now, being a beginner, 2% is very good! Rather than being Negative as most company would have while being a startup.