“The World’s No.2” CEO Letter to All Employees

Dear Xiaomi colleagues,

I have some wonderful news to share with you: Canalys just published its Q2 global smartphone market share report. According to the report, Xiaomi achieved a 17% market share, surpassing Apple and became the No. 2 globally. For the first time ever, Xiaomi became No. 2 in the world. It is a fantastic achievement, and also an important milestone in Xiaomi’s history. On August 16, we will celebrate the 10th anniversary of the launch of the Xiaomi smartphones, and I am ecstatic to receive such thrilling news at this very moment!

In 2014 Q3, we took the third place globally for the first time in our history. Unfortunately, we ran into many difficulties subsequently and dropped out of the Top 5. Since 2016, we underwent a comprehensive review of our business, and after five years of self-improvement, we significantly enhanced our product capabilities, and paved our way in the premium market segment and reinforced our position there. We regained our No. 3 position globally in 2020 Q3. Just two quarters later, we made another giant leap. We appreciate the unwavering support from our Mi Fans around the world; we appreciate the sincere help from all of our partners; and above all, we appreciate the tremendous efforts of all of our our employees, not to mention the understanding and support from their families, for making this happen! Thank you all!

“The World’s No.2” is a major victory for our strategy.

Last August, we established our core strategy for the next decade — “Smartphone x AIoT”, once again affirming the core position of our smartphone business, and further promoting smart interconnectivity. Our AIoT business revolves around our smartphones and builds a smart living ecosystem, becomes the amplifier of Xiaomi’s values in letting everyone in the world enjoy a better life through innovative technology, and makes Xiaomi the true leader of smart living in the future. At the same time, we also established the “three guiding principles” that we will resolutely stick to: We will never cease to explore and innovate, to bring everyone the most innovative technologies; we will continue to offer products with the best price-to-performance ratio; we will seek to make the coolest products. In 2020, our R&D expenses was nearly RMB10 billion and for this year, we expect that to exceed RMB13 billion. We will further expand our R&D team by recruiting more than 5,000 engineers this year. We have already achieved a series of far-reaching developments in critical technology areas such as imaging, fast charging, AI, IoT platforms, etc. to date, and have firmly established a leading position in the global industry. We also launched and debuted the Surge C1 processor – a professional image processing chip – this year.

“The World No. 2” is the result of the hard work of our employees around the world

We have made momentous progress in our new retail pilot project in China: We have achieved early success in our integrated online-offline retail model in China, and we plan to cover every town with our “Mi-Home” in 2021. Meanwhile, the integrated online-offline business model has been proven successful. Our international business is also going very well and we have entered more than 100 overseas markets around the world. Our international business contributes close to half of our total revenue. We are No.1 in terms of smartphone market share across more than 10 markets. Xiaomi has become a truly globalized company.

We will continuously strengthen our core capabilities and keep striving towards our dreams.

Dear colleagues, the world’s No. 2 means greater challenges and responsibilities for Xiaomi. This is the first time we reached this unprecedented level, and we will inevitably face many vicious and fierce battles ahead of us. Notwithstanding the celebrations now, I want to make sure we can maintain our second place steadily and firmly in the future. It is an honor for us to compete with the most powerful and innovative companies in the world at the peak on the global stage. We are still very young and thus have not accumulated sufficient experiences yet; we must keep calm and stay humble. Our peers are our role models and our whetstones. It is this fierce competition that has driven all of us to make progress mutually. And through this, we can continue to sharpen ourselves and get stronger.

In the past three years, we have recruited a group of energetic and experienced senior executives externally. At the same time, we also promoted several young senior executives and many young general managers internally. This energetic team will provide Xiaomi with a wise, open-minded and solid leadership in the next decade. Recently, we revealed our “Incentive Plan for Young Engineers” by awarding 3904 outstanding engineers. We also launched a new 10-year incentive program to 122 technology experts, members of our new-decade entrepreneur project, and mid-to-senior executives. This best-ever Xiaomi team is marching proudly on its future journey with very high morale.

The mission of Xiaomi is “to build amazing products with honest prices so that everyone in the world can enjoy a better life through innovative technology”. This journey is destined to be long and tough, with more loneliness than revels, more tribulations than applauses. However, as long as we are moving in the right direction, we shall have no fear of the distance. Dear colleagues, please join me in rolling up your sleeves and working hard to strive towards our dreams with all our might. Full speed ahead!

Lei Jun

July 16, 2021

Xiaomi Takes The No.2 Spot In Global Smartphone Market For The First Time

Beijing, CHINA, July 16, 2021 – Canalys, the leading global market research firm, launched its Q2 global smartphone market report in which Xiaomi took second place with a 17% share and a 83% YoY growth, surpassing Apple.

Canalys expressed that Xiaomi is now transforming its business model from challenger to incumbent, with initiatives such as channel partner consolidation and more careful management in the open market. Canalys commented that Xiaomi’s new goal is to displace Samsung to become the world’s largest vendor.

In a letter to all employees, Lei Jun, Founder, Chairman and CEO of Xiaomi, pointed out that becoming the World’s No.2 is a key milestone in Xiaomi’s history. After five years of self-improvement under extremely difficult conditions, Xiaomi’s product capabilities have been enhanced significantly – they paved the way for the premium market segment and increased its market share. Xiaomi will continuously strengthen its core capabilities and cement its place as the second largest smartphone brand.

In Q4 2020, the global shipments of Xiaomi reached 43.4 million units with 31.5% YoY growth, surpassing Apple for the first time and returning to the third place. In Q1 2021, Apple rose to No.2 with 15% of global smartphone market share, followed closely by Xiaomi with its 14% of market share. Xiaomi’s global smartphone shipments were 49.4 million units back then with 69.1% YoY growth.

Since Xiaomi launched its first premium flagship Mi 10 series, it has been continuously innovating in critical areas, such as imaging, display, charging, smart manufacturing and more. Xiaomi has invested in achieving breakthrough in premium market, bringing cutting-edge leading technology to consumers, and helping to shape the direction of the industry.

Xiaomi has been the first to bring numerous industry-leading technologies to market. In camera technology, the company introduced the 108-megapixel camera, the GN2 camera sensor and an innovative liquid lens. In display, it has been pioneering the technology research of the third generation under-display camera. Xiaomi has also led in battery charging, realizing 200W wired charging and 120W wireless charging for the very first time. In addition, it was the first to introduce graphene-based lithium-ion batteries and second-generation silicon oxygen batteries. Xiaomi is also a pioneer in mobile phone ceramics, leading the trend of industry exploration.

In addition, the first phase of Xiaomi’s smart factory has started operation. Its production lines are automated and capable of manufacturing a million high-end smartphones per year, it is also a huge lab facility which enables Xiaomi to research new materials and technologies as well as test advanced manufacturing and production processes.

Innovation is part of Xiaomi’s culture and the company invests considerably in R&D and recruiting the very best talent. Xiaomi has invested nearly RMB10 billion in R&D in 2020, this year the number is expected to increase by 30-40%. At the beginning of 2021, Xiaomi announced the biggest engineers recruitment drive in its history: 5,000 engineers in one single year, which will occupy 20% of total employees. Meanwhile, Xiaomi has launched multiple talent incentive initiatives such as one million US dollars award project for technology talents, young engineers incentive plan, etc. Nearly 700 young engineers of Xiaomi were granted 16 million shares, following the incentive plan just in the month of July.

Xiaomi’s global expansion as well as the transformation in new retail channels have been an important driving force in helping the company become the second largest smartphone manufacturer. According to the latest global smartphone data of Canalys, Xiaomi is expanding fast in overseas markets, reaching over 300% YoY growth in Latin America market, over 150% YoY growth in Africa and over 50% YoY growth in Western Europe. According to the Q1 2021 Results Announcement of Xiaomi, Xiaomi smartphones have entered over 100 markets worldwide, ranked No. 1 in terms of smartphone market share across 12 markets and ranked No.2 in Europe. It is also No. 1 in India for years.

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About Xiaomi Corporation

Xiaomi Corporation was founded in April 2010 and listed on the Main Board of the Hong Kong Stock Exchange on July 9, 2018 (1810.HK). Xiaomi is an internet company with smartphones and smart hardware connected by an Internet of Things (IoT) platform at its core.

With an equal emphasis on innovation and quality, Xiaomi continuously pursues high-quality user experience and operational efficiency. The company relentlessly builds amazing products with honest prices to let everyone in the world enjoy a better life through innovative technology.

As of the second quarter of 2021, Xiaomi is the no.2 smartphone brand in the global smartphone market. The company has also established the world’s leading consumer AIoT (AI+IoT) platform, with 351.1 million smart devices connected to its platform, excluding smartphones and laptops. Xiaomi products are present in more than 100 countries and regions around the world. In August 2020, the company made the Fortune Global 500 list for the second time, ranking 422nd, up 46 places compared to 2019. It also ranked 7th among internet companies.

Xiaomi is a constituent of the Hang Seng Index, Hang Seng China Enterprises Index, Hang Seng TECH Index and Hang Seng China 50 Index.

For more information about Xiaomi as a company, please visit https://blog.mi.com/en/