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Xiaomi makes and sells smartphones and smart home devices, and also earns money from internet services and now electric cars.
Xiaomi is best known for making smartphones, but the real picture is a company that sells affordable gadgets of almost every kind. It sells phones, smart TVs, robot vacuums, scooters, fitness bands, and other internet-connected devices, mostly under its Mi and Redmi brands. People buy Xiaomi because the products are usually cheaper than competitors from Apple or Samsung while still feeling well-made. It also runs a retail network of "Mi Stores" and sells directly online, which keeps costs low.
The business is simple at its core: Xiaomi designs the products, outsources manufacturing to partners, and sells in huge volumes at thin profit margins. The real money comes from the phone as a gateway. Once you own a Xiaomi phone, you might use its app store, watch ads, buy subscriptions, or buy more connected gadgets. That "internet services" side carries much fatter margins than selling hardware, so a phone sale is really the start of a relationship rather than the end of one. Xiaomi's hardware is a key that unlocks more valuable doors. The most important recent chapter is cars. Xiaomi launched its first electric vehicle, the SU7 sedan, in 2024, and demand has been strong. Building cars is a very different business from making phones, though — it's capital-hungry and fiercely competitive in China, where BYD and Tesla dominate. Xiaomi has also been hurt by the global smartphone slump and by the fact that its home market is extremely crowded with rivals like Oppo and Vivo, which keeps phone prices and margins under pressure.
In 2010, a small team in Beijing started a software company, not a phone company. Their first product was MIUI, a polished version of Android that people could install and help improve. Fans loved being part of it, and that community became the launchpad for everything that came next.
A year later, Xiaomi sold its first phone, packed with premium parts but priced far below what those parts usually cost. It sold only online, in limited batches, which kept costs low and made each sale feel like an event. The bet worked: Xiaomi was now a hardware company with a direct line to its customers.
Xiaomi then went after budget buyers with the Redmi line, which reset what a cheap phone could be, and pushed into the living room with the Mi TV. It also hired a top Google executive, Hugo Barra, to lead its push abroad, a clear sign it wanted to play on the world stage.
By 2014, Xiaomi was the world's third-biggest phone maker. That same year it entered India, a market that would grow into its biggest one outside China.
In 2016, Xiaomi showed the Mi MIX, a phone with almost no frame around the screen. It was a concept device, but it changed how the whole industry thought about phone design and gave Xiaomi a reputation for real innovation.
The next year brought the Surge S1, Xiaomi's first chip designed in-house. Only a handful of companies could make their own phone chips, so this put Xiaomi in a tiny club and reduced its reliance on outside suppliers.
Xiaomi listed on the Hong Kong Stock Exchange in 2018, the first company there to use a share structure that let founders keep control. The shares opened below the price investors had paid, a shaky start that reminded everyone how much expectations had built up around the company.
In 2021, Xiaomi announced it was getting into electric cars, with a long-term plan to invest heavily. It was a huge leap from phones, and it framed the goal as a single ecosystem: people, cars and homes all connected.
The first Xiaomi car, the SU7, launched in 2024 and orders poured in within weeks. Years of planning had turned into a real product on the road, and Xiaomi suddenly had a second growth engine beyond phones.
By 2025, the numbers showed the car bet was no longer just a promise. Revenue hit a record and profit jumped, and for the first time the car and smart home businesses together made a positive operating profit.
With cars and devices now under one roof, Xiaomi turned to artificial intelligence. It unveiled its own large models, pledged a massive investment over the next three years, and set out to weave AI through its whole phone-car-home ecosystem.
The interesting tension in Xiaomi is that its cheap-hardware image is both its strength and its weakness. Low prices win customers, but they also mean the company must sell enormous volumes to make decent money. It also faces regulatory scrutiny in places like India, its biggest overseas market, where authorities have probed its payments and money transfers. All of this makes Xiaomi a bet that it can keep turning cheap gadgets into loyal users, and now into car buyers too.
Saved answer · last researched 29 Oct 2026