tech

January 23, 2026

Xiaomi announces HK$2.5 billion buyback as competition and cost pressures weigh on stock

Chinese tech giant Xiaomi saw its shares pop in trading on Friday after it announced a stock buyback program worth up to HK$2.5 billion ($321 million).

Xiaomi announces HK$2.5 billion buyback as competition and cost pressures weigh on stock

TL;DR

  • Xiaomi announced a stock buyback program worth up to HK$2.5 billion ($321 million).
  • The buyback aims to reassure investors amid competition, rising component costs, and safety concerns.
  • Despite Friday's gains, Xiaomi's shares are down over 8% year-to-date.
  • Critics argue stock buybacks divert cash from investments in employees, factories, and innovation.
  • A memory chip shortage threatens to increase component costs and compress margins for smartphone manufacturers.
  • Industry forecasts suggest the chip shortage will worsen, impacting Chinese Original Equipment Manufacturers.
  • Xiaomi faced pressure last year due to viral reports of accidents involving its vehicles.
  • The company faces a price war in China's EV market, impacting sector margins.
  • Investors are disappointed by Xiaomi's modest 550,000-unit vehicle delivery target for 2026.
  • Margins on Xiaomi's vehicle sales are expected to decline due to changes in EV subsidy policies.
  • Xiaomi is investing heavily in its semiconductor division, committing at least 50 billion yuan over 10 years.
  • The company plans global expansion for its electric vehicles business after launching the SU7 Ultra.

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