Chinese device maker Xiaomi returned to profit growth in Q3, with gains in its IoT and lifestyle, and internet divisions offsetting continued weakness in smartphones.
Chair and CEO Lei Jun stated while the overall external environment showed few signs of improvement, Xiaomi registered year-on-year growth in quarterly revenue for the first time in six quarters.
Lei said it invested CNY1.7 billion ($239.7 million) in its smart electric vehicle business and other new initiatives during the period.
Xiaomi booked a net profit of CNY4.9 billion compared with a CNY1.5 billion loss in Q3 2022. Total revenue was flat at CNY70.9 billion.
Despite a 4 per cent increase in smartphone shipments to 40.2 million units, revenue declined 2 per cent to CNY41.6 billion due to a 5.8 per cent decline in ASP to CNY997.
Total inventory dropped 30.5 per cent to CNY36.8 billion, to the lowest level in 11 quarters.
Revenue from IoT and lifestyle products increased 8.5 per cent to CNY20.7 billion, and internet services sales 9.7 per cent to RMB7.8 billion, fuelled mainly by gains in advertising.
R&D expenses increased 22 per cent to CNY5 billion, with research staff accounting for more than 53 per cent of the total workforce.