On May 10, 2025, Xiaomi CEO Lei Jun posted a somber reflection on Weibo: "The past 42 days have been the toughest period since Xiaomi's founding 14 years ago." Soon, he may revisit this sentiment—perhaps in light of a milestone for Xiaomi’s electric vehicle (EV) division.
Recently, Xiaomi’s EV business has dominated online discussions, with topics ranging from "hidden door handle safety risks" and "fine-print marketing" to accusations of "PR missteps" and "black PR campaigns." State media have also weighed in, urging automakers to prioritize safety and avoid fan-driven marketing.
Since the fiery incident involving a Xiaomi SU7 in Chengdu, both Xiaomi and Lei Jun have faced intense scrutiny. Yet one critical point has been overlooked: Xiaomi’s EV arm may soon defy expectations. While public perception may not reverse overnight, the company is on track to become a commercially enviable newcomer in the auto industry.
**Profitability Within Reach** At Xiaomi’s investor meeting in June, Lei Jun projected that the EV division would turn profitable in Q3 or Q4 2025. As this timeline approaches, skepticism about his claims is fading. Analysts now see a high likelihood of Xiaomi EV posting profits as early as Q3.
Citigroup forecasts that Xiaomi Group (01810.HK) will report Q3 2025 earnings on November 18, with EV operations swinging to a profit of RMB 722 million. Similarly, Huatai Securities predicts breakeven or even RMB 1 billion in profit for the quarter.
These projections are grounded in Xiaomi EV’s strong financials. In Q2 2025, its revenue surged 230.3% YoY to RMB 20.6 billion, while operating losses narrowed to RMB 300 million from RMB 500 million in Q1. Gross margins hit 26.4%, outperforming peers like Leapmotor (14.1%) and Seres (28.9%).
If realized, Xiaomi EV’s profitability would set a new industry benchmark. For context, Li Auto achieved its first annual profit in 2023 after eight years, while NIO and XPeng—despite over a decade in the market—are only expected to approach profitability in late 2025, with no guarantees.
Xiaomi President Lu Weibing has cautioned that cumulative profitability will take longer, but near-term milestones could still reshape perceptions.
**Turning the Tide Amid Controversy** Despite its rapid commercialization, Xiaomi EV has drawn disproportionate criticism. A fatal accident in Chengdu on October 13, involving a SU7 that caught fire after a collision, sparked outrage over door mechanisms and safety. Lei Jun’s subsequent call to "innovate on a foundation of safety" and "reject black PR" did little to quell the backlash, especially as state media echoed concerns.
Articles like *First财经*’s "Build Young People’s First Car, Not Their Last" and *潮新闻*’s "Don’t Use Black PR to Vilify Safety Concerns" amplified scrutiny. Meanwhile, a debunked rumor about "one-second SOS response" fueled resentment toward Xiaomi’s marketing tactics.
Yet, if Q3 results confirm profitability, the narrative could shift dramatically. Success might also rebuild trust, contrasting with failed EV startups like WM Motor and Hozon, whose struggles left consumers wary.
Recent leaks suggest Xiaomi EV delivered ~12,000 units last week—a record high. While criticism persists, such metrics are hard to ignore. The question remains: How will skeptics react if Xiaomi proves its commercial viability?
Ultimately, sustainability in autos isn’t defined by quarterly profits alone (witness Zotye’s collapse) or fleeting delivery spikes (see WM Motor). For Xiaomi, resolving trust issues will be as crucial as financial performance.