Xiaomi ups EV goal to 120,000 as Q1 tops forecasts on strong phone sales

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(This May 23 story has been corrected to say SU7, not SUV7, in the penultimate paragraph; and three models, not four, in the final paragraph)

By Liam Mo and Casey Hall

BEIJING (Reuters) - China's Xiaomi said it will aim to deliver 120,000 electric vehicles (EVs) this year, up from the initial goal of 100,000, and will implement double-shift production to meet rising demand for its EVs.

Xiaomi made this announcement during an earnings call after the company reported a stronger-than-expected 27% year-over-year increase in first-quarter revenue on Thursday, driven by robust smartphone sales amid a recovery in the market.

Xiaomi started delivering its SU7 EV to customers in early April, fulfilling CEO Lei Jun's dream and culminating years of effort to enter the EV business as part of the company's strategy to diversify away from smartphones.

Xiaomi's President Lu Weibing said on the call that double-shift production will start from next month to ensure monthly deliveries exceed 10,000 units. Lu said that demand for the SU7 has been strong, with cumulative locked-in orders reaching 88,063 vehicles as of the end of last month.

For the first three months of this year, Xiaomi's revenue was 75.5 billion yuan ($10.42 billion), compared with the 73.3 billion yuan estimated by analysts according to LSEG.

Adjusted net income was 6.49 billion yuan, beating the 4.94 billion yuan estimated by analysts.

The global smartphone market has shown signs of a recovery since late last year after a prolonged period of sluggishness.

Xiaomi's global smartphone shipments rose 33% to 40.7 million units in the first quarter, helping the company capture a 14% market share and placing it in the No. 3 position, according to industry research firm Canalys.

In China, Xiaomi's largest market for its smartphone business, shipments rose 8.6%, according to research firm Counterpoint.

Lu said that the company will start reporting automotive revenue separately, beginning in the current quarter.

Analysts from brokerage firm SPDB International wrote in a note that Xiaomi's auto-related revenue is expected to reach 23.7 billion yuan in 2024 and more than double to 50.8 billion yuan in 2025.

Xiaomi's shares have rallied over the past two months as investors cheered its EV progress. Its current share price is about 30% higher than the level in late March when the company announced the pricing of its SU7 series.

The company's SU7 currently has three models, with prices ranging from 215,900 to 299,900 yuan. As of May 15, Xiaomi has delivered 10,000 EVs.

($1 = 7.2437 Chinese yuan)

(Reporting by Liam Mo and Casey Hall; Editing by Subhranshu Sahu and Chizu Nomiyama)