Xiaomi chief Lei Jun set a 2017 sales target of more than CNY100 billion ($14.5 billion), although the company remained tight-lipped on its smartphone performance during a tough 2016.
According to Reuters, the executive said “the worst is over” after making adjustments to various businesses as it quickly grew and embraced new markets. Among the issues it faced were increasing maturity and competition in China’s smartphone market, and its international push was also challenging. It also admitted to suffering from smartphone supply issues for four months in 2016.
TechCrunch reported Xiaomi will not disclosed its smartphone volumes for 2016 – a departure from the company’s past policy and a decision suggesting the figure is not one Xiaomi wants to shout from the rooftops. In the past the company was criticised for failing to meet its own, often lofty, targets.
Xiaomi recently said that it does not make a profit from smartphones. However, falling revenue from its core business will undoubtedly impact its ability to drive growth into future profit-making activities.
In a statement today, Lei Jun (pictured) claimed that “rather than pursuing profit, I believe there is a better future for us when we focus on product experience. Rather than many layers of distribution channels that add to the cost of products, I believe that high-quality products at accessible prices will win more people’s hearts. It is a challenging road ahead, and we must overcome the difficulties as we work towards our dream.”
Of course, the CEO did point out the company reached a number of impressive milestones: it achieved $1 billion in annual revenue in India for the first time; its offline stores passed CNY100 million in gross merchandise volume (it also sells partner products); and revenue from internet services doubled.
For a company which became well-known due to its lower-cost devices sold online, Xiaomi is also set to significantly beef up its retail strategy in order to address a greater portion of China’s smartphone market – effectively ending up in the same position as its rivals, but from a different starting point.