Xiaomi stock at risk as phone market share slips while Samsung, Apple gain ground

Xiaomi stock retreated for two consecutive days after a report confirmed that the company was losing market share in the smartphone industry. It slipped to H$25.82 in Hong Kong, a few points below this month’s high of H$26.70. 

Xiaomi is losing market share in the smartphone industry

A report released by Omdia showed that Xiaomi’s woes mounted in the second quarter, a situation that may lead to weaker revenue and profitability growth. 

Xiaomi’s market share dropped to 11%, making it the third-biggest player in the industry after Samsung and Apple. Its share has been in a slow downward trend after peaking at about 15% in the second quarter of last year.

In contrast, Samsung became the biggest smartphone maker in the world with a share of 22%, while Apple has 20%. The report noted that the delayed launch of Samsung S26-series pushed some demand into the second quarter. Samsung also gained ground in the budget segment.

Apple’s sales were boosted by iPhone 17, which delivered the strongest iPhone refresh and upgrade cycle in the company’s history.

Xiaomi’s market share retreat happened as vendors in the sub-$400 mass market shifted strategy. Instead of prioritizing volumes, they are now focusing on adjusting retail prices and in their premium segments. Rujan Bjorvovde, the Principal Analyst at Omdia, said:

“Managing the surging component costs is incredibly complex and unpredictable, with some vendors facing memory costing more than four to five times what they did a year ago.”

Xiaomi’s business is struggling as the memory crisis intensifies, with memory and storage costs accounting for about 60% of the bill of materials for budget devices. Sadly, there is still no end in sight for this memory crisis, with Apple warning that it will hike prices for its next models.

Xiaomi’s revenue and profits have nosedived

The most recent earnings report showed that the company’s revenue and profits nosedived in the first quarter. Its revenue dropped to RMB 99.14 billion from RMB 111.29 billion in the same period last year. Smartphone revenue slipped by 10% to RMB79.3 billion.

On the positive side, the smartphone revenue decline was offset by a modest increase in its smart EV, AI, and New Initiatives segment. This segment’s revenue rose by 6.9% to RMB 19.9 billion, helped by more vehicle sales and offset by lower prices. It delivered 80,856 vehicles in Q1, up from 75,869 in the previous quarter.

Its profitability remained under pressure, with the profit for the period dropping to RMB 4.7 billion from the previous RMB 10.89 billion. These dynamics likely continued in the second quarter as its smartphone sales dropped.

Xiaomi stock price technical analysis

Xiaomi stock chart | Source: TradingView

The weekly chart shows that the Xiaomi stock has been under pressure in the past few months as challenges in its business continued. It plunged from H$61.45 in June last year to the current H$25.82. 

The stock has slumped below the 61.8% Fibonacci Retracement level, where most rebounds normally happen. It has remained below the 50 and 200 moving averages.

Therefore, the most likely forecast is bearish as traders wait for its next earnings report, which is expected in August. If this happens, there is a risk that it will drop and retest the support of H$21.35.