Xiaomi rushes towards a trillion

Author | Wang Xiaojun

Editor | Zhou Zhiyu

The myth created by Lei Jun continues.

On the second trading day of 2025, Xiaomi Corporation's stock price soared at the opening, closing up 6.62% to HKD 36.25, setting a new historical high.

This year's delivery targets exceeded expectations, and the consumer electronics subsidy policy stimulated Xiaomi's stock price.

The National Development and Reform Commission stated on January 3 that it will further expand the scope of national subsidies. Among them, new subsidies for digital products will provide subsidies to individual consumers purchasing three types of digital products: mobile phones, tablets, and smartwatches.

In the third quarter of last year, more than half of Xiaomi Corporation's revenue came from its mobile phone business. Multiple institutions expect that national subsidies for consumer electronics will stimulate consumers to upgrade their devices, which is beneficial for companies like Xiaomi in the mobile phone business. Following this news, Xiaomi's stock price surged rapidly after the opening, rising over 6% at one point during the session.

Before this wave, with the automotive business booming, Xiaomi's stock price had already exceeded HKD 35 and approached HKD 35.9 per share. With the significant rise in stock price on January 3, it also set a historical high since its listing, racing towards a trillion market value.

By the end of 2024, Lei Jun announced that Xiaomi SU7 had delivered over 130,000 vehicles in just nine months since its launch, a speed unprecedented in the industry, dispelling doubts about Xiaomi's foray into car manufacturing. The supply-demand imbalance for the Xiaomi SU7 has repeatedly stimulated Xiaomi's stock price, rising from last year's low of HKD 11.84 to HKD 36.25, an increase of over 200%.

Guosen Securities' research report points out that it is optimistic about Xiaomi Corporation's smartphone business benefiting from the AI upgrade wave and enhanced profitability from high-end products. It is also optimistic about the smooth delivery of the company's smart electric vehicle business and the performance growth brought by the progress of new business segments, while the company's AIoT and internet businesses show a growth trend.

What excites the market even more is Xiaomi's sales target for automobiles this year.

In a New Year's live broadcast, Lei Jun set a delivery target of 300,000 vehicles for Xiaomi automobiles in 2025. This scale is also regarded as the minimum threshold for achieving economies of scale in the automotive industry; BYD took 10 years to reach annual sales of 300,000 after entering the automotive sector.

Morgan Stanley's research report believes that Xiaomi's product mix will have positive changes in 2025, which may drive an increase in average selling prices and better profit margins for electric vehicles. Additionally, Xiaomi's delivery volume in 2024 is expected to be strong, and the high target for 2025's shipment volume indicates excellent execution capabilities in the new electric vehicle business.

Moreover, although Xiaomi is a latecomer to the automotive industry, it has caught the last window of opportunity. In the current game rules of the automotive industry, where survival is key, Xiaomi holds many cards. For instance, while other companies have begun discussing overseas expansion, Xiaomi's automotive overseas story has yet to begin. Once it joins in, it could not only open up the scale of Xiaomi automobiles but also further boost Xiaomi's stock price.

Furthermore, Lei Jun's high-profile recruitment to strengthen AI large models sends a strong signal to the outside world that he will further focus on AI large models. This is also expected to directly change Xiaomi's valuation approach While major model companies are scratching their heads seeking commercial landing paths for AI large models, Xiaomi already has ready-made products in the entire ecosystem of people, vehicles, and homes waiting for AI large models to empower them, which gives Xiaomi more imaginative space in the AI large model track.

With the car manufacturing venture, Lei Jun successfully turned the tide in 2024. Even Lei Jun's social media has transformed into a wish pool for netizens, who are wishing for Xiaomi to produce various items. Xiaomi and Lei Jun have tapped into the zeitgeist.

As an entrepreneur in his fifties, Lei Jun is also regarded as the entrepreneur who resonates most with the younger generation, attracting attention and admiration from young people, which will bring a continuous stream of consumers to Xiaomi and make Xiaomi's story even more appealing.

However, to successfully challenge a market value of one trillion and stabilize it, Xiaomi still faces a series of tests.

The Xiaomi YU7 will also join in mid-year, helping Xiaomi cars sprint towards the goal of 300,000 units. However, the new factory will still face the issue of ramping up production capacity, and Lei Jun has admitted that this is definitely not an easy target.

Moreover, Xiaomi's car manufacturing is still in the phase of significant investment, and new cars waiting to be launched require real capital; the new story involving AI large models is also in the early investment stage, needing financial support to convert into commercial revenue and improve financial performance, which is a long battle.

For Xiaomi, a market value of one trillion Hong Kong dollars seems not far off, but just like car manufacturing, it also requires solid steps to be taken to ultimately gain recognition from users and the market