Xiaomi’s Buyback Blitz and EV Ambition Clash With Shrinking Smartphone Share and a Downgrade
Published on 07/20/2026 at 02:43 | Redaktion boerse-global.de
The Chinese technology group Xiaomi is navigating a deeply divided operating landscape. While its buyback program signals management’s confidence in the stock and its electric-vehicle division accelerates, the company’s core smartphone business is losing ground to global rivals. The tension between those forces has left the stock volatile, recovering from a June low but still nursing a double-digit loss for the year.
Global smartphone market data from Omdia for the second quarter of 2026 paints a stark picture: Xiaomi’s worldwide share has slipped to just 11%, trailing far behind Samsung’s 22% and Apple’s 20%. The deterioration in the handset business is a familiar challenge, but it now carries added weight. Analyst house Astrada Advisors downgraded the stock to HOLD on July 16, citing doubts about whether Xiaomi can hit its full-year volume targets. The call came in the same week as the weak market-share numbers, reinforcing a narrative of mounting pressure in the company’s core revenue engine.
Buybacks Keep Flowing Even as Employee Shares Dilute the Effect
Xiaomi has been leaning heavily on its share repurchase program to support the stock. Since the board approved a buyback mandate on June 2, the company has executed 14 tranches, buying back a total of approximately 79.8 million shares — about 0.31% of its issued capital. The most recent round, on July 15, saw 3.9 million shares purchased at an average price of 25.82 Hong Kong dollars. Management confirmed on July 18 that the program, which has an authorized volume of up to 20 billion HKD, remains active.
Yet the net effect on the capital base is tempered by a parallel issuance of new shares. Between July 2 and July 15, Xiaomi issued roughly 824,000 shares from employee equity plans. The buyback and the equity issuance thus run in opposite directions: the company removes stock from the market on one side while feeding new shares to staff on the other.
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EV Division Gains Traction but Still Bleeds Cash
The brightest spot in Xiaomi’s portfolio continues to be its automotive venture. In the first quarter of 2026, the Xiaomi Auto unit delivered 80,856 electric vehicles, generating segment revenue of 19.9 billion yuan. The gross margin stood at an encouraging 22.7%, suggesting the manufacturing ramp is progressing. But the division remains loss-making: its operating loss came in at 3.1 billion yuan, a figure that underscores the heavy investment still required.
The product pipeline is also advancing. Spy shots from Germany’s Nürburgring circuit in mid-July revealed a new “Extreme” variant of the SU7 Ultra sports sedan, distinguished by an enlarged rear wing and a modified diffuser aimed at optimizing downforce. No official launch date or technical specifications have been released, but the development signals that Xiaomi is pushing its EV brand upmarket.
New Hardware Offers a Domestic Breather
Back in the smartphone arena, Xiaomi is trying to shore up its domestic base. On July 14, it unveiled the Redmi Note 17 series in China, featuring silicon-carbon batteries with a 9,000 milliampere-hour capacity — a notable upgrade. The company is backing the longevity claim with an unusually long five-year warranty, a move clearly designed to retain buyers in the fiercely competitive Chinese mass market where the brand is strongest.
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The stock itself has clawed back 12.45% over the past 30 days, though on a month-over-month basis the gain is a more modest 8.57%. Still, the broader year-to-date picture is grim: the shares have lost 29.93% since January, and they stand 53.39% below the 52-week high of 6.51 euros reached in September 2025. At Friday’s close of 3.03 euros — a daily decline of 1.43% — the stock trades roughly 29.60% above its 52-week low from June 26, 2026, a sign that the recent recovery has at least stopped the bleeding.
August Results Will Test the Narrative
All eyes now turn to August 26, when Xiaomi will release its unaudited second-quarter results. The numbers will show whether the first-quarter trend — rising vehicle deliveries alongside persistent margin pressure in the auto unit — has continued. For investors, the report will also clarify whether the buyback program, the new Redmi devices, and the EV push are sufficient to offset the steady loss of global smartphone share to Samsung and Apple. The answer to that question will determine whether the current rally has legs or remains a temporary respite in a longer downturn.
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