Xiaomi Q2 earnings key to extending stock’s best rally in a year
The smartphone maker’s shares could continue its advance if its earnings, due on Aug 18, show it has a handle on rising material costs
Published Tue, Aug 18, 2026 · 09:23 AM
[HONG KONG] Xiaomi shares may extend their best quarterly performance in over a year if its earnings report shows it has gotten a handle on rising material expenses.
Shares of the smartphone and electric vehicle maker have climbed nearly 20 per cent in Hong Kong since the end of June.
That follows four straight quarters of losses on concerns over weak smartphone demand and high component costs.
The rebound has been driven by excitement over Xiaomi’s new SUV model releases, along with improving investor sentiment on undervalued Chinese tech shares.
The stock is trading at 17 times forward earnings estimates, below its five-year average and compared with 22 times for the Nasdaq 100 Index.
The company is expected to report results for the second quarter later on Tuesday (Aug 18).
“Top of mind for investors is how Xiaomi’s smartphone unit is coping with elevated memory costs, and whether its product mix can keep shifting toward higher‑priced models that provide a stronger cushion,” said Kenny Ng, a strategist at China Everbright Securities International.
Better-than-expected profitability would be a key catalyst for the shares, he added.
Xiaomi faces a lowered bar to impress the market after consensus downgrades.
Analyst estimates now indicate a 6.6 per cent decline in quarterly sales with a gross profit margin of 20.4 per cent, down about two points from 2025’s level, according to data compiled by Bloomberg.
While Xiaomi’s EV business has been a relative bright spot, its delivery target of 550,000 units for the year “is becoming increasingly challenging”, Bernstein analysts including Eunice Lee wrote in a note.
“While still achievable, it will require flawless execution and a rapid ramp of new SkyNomad model.”
Options traders are pricing in a 3.6 per cent swing in either direction for Xiaomi shares after the results.
That is more than the average 2.8 per cent fluctuation seen following the last eight quarterly reports.
Traders have slightly pared bearish bets on Xiaomi. Short interest has dropped to 8.2 per cent of the free float compared with a record high of 9.3 per cent in June, according to S3 Partners. BLOOMBERG
