Xiaomi Stock Slides Nearly 7% as EV Margin and Sales Concerns Mount

Shares of Xiaomi Corp. (1810.HK) tumbled nearly 7% to HK$28.90 in Hong Kong trading after the launch of its new electric sport-utility vehicles failed to sustain recent buying momentum, instead fueling investor concerns over profitability and sales targets.

The drop followed a sharp rally in the stock leading up to the event, suggesting a "sell-the-news" reaction from the market.

EV Launch Sparks Profitability Fears

Xiaomi unveiled its SkyNomad SUV lineup on the evening of July 30, introducing the flagship N90 Max at 299,900 yuan and the N70 Max at 259,900 yuan. According to a report from Investing.com, the pricing immediately raised questions about the company's ability to generate healthy profit margins.

The launch comes as Xiaomi is embroiled in an intense price war with domestic rivals, all competing for market share in China, the world's largest and most competitive electric vehicle market. These concerns over profitability could impact Xiaomi's bottom line in the coming quarters.

Sales Targets and Analyst Outlook Weaken

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Adding to investor apprehension are doubts about the company's delivery volumes. Xiaomi's EV sales in the first half of the year amounted to only about one-third of its full-year target, raising the stakes for the new SUV line to significantly boost performance.

This sales pressure is reflected in a weakening analyst outlook. According to the report, consensus earnings estimates for fiscal year 2026 have been revised materially lower in recent weeks, with cuts to both revenue and earnings-per-share forecasts.

Broader Headwinds and Market Underperformance

Several other factors are weighing on the stock. A share buyback program has provided limited support, with approximately 89% of its authorization remaining unused. Meanwhile, Xiaomi's core smartphone business faces its own challenges, as rising memory chip costs continue to compress margins.

The combination of these concerns saw Xiaomi's shares significantly lag the broader gains across Asian technology stocks during the session.