小米（1810 HK）：2025年第三季度展望：预计电动汽车业务改善可抵消智能手机/物联网疲软，再迎强劲季度

3Q25 preview:expectanotherstrongquarteronbetterEVbusinessoffsettingsoftersmartphone/IoT Target PriceHK$61.30(Previous TPHK$62.96)Up/Downside33.5%Current PriceHK$45.92 Xiaomi is expected to report 3Q25 results in mid-Nov. We expect 3Q25E todeliveranother strongadj.net profit growth of60% YoY to RMB10.01bn, in-line with consensusestimates,mainly driven bystrong momentum ofsmart EVwith improvingprofitabilityand stable IoT/internet growth.ForGPM, despitesmartphoneBOM cost hikes(esp.memory),our3QGPMestimate is at 22.9% (vs 22.5% for consensus), backed byresilientsmart phone(SP)/IoT/internet GPM at 11%/23%/75.3%, while EV GPMmaycome in softerat 25.8% (vs 26.4 in 2Q)on capacity constraint,on our estimate.For4Q,westaypositive on: 1) smartphone:highersalesmixfromXiaomi 17 Pro/Pro-max,Double 11 promotions,and new retail strategy; 2) Smart EV: strong delivery withimprovingprofitabilityand potentialcapacity expansion; 3) Internet: stable growth withGPMat 75%. Overall, we slightlytrimFY25-27E adj.net profit by3-4% to reflectsofterSP business, EV biz break-even in 3Q andhigher BOM costs. Reiterate BUY and ournew SOTP-based TP of HK$61.3 implies 33.9x/26.5x FY25E/26E P/E.Upcomingcatalysts include 3Q25 results,the Double11festival,new product launches,andEVcapacity expansion. China Technology Alex NG(852) 3900 0881alexng@cmbi.com.hk Hanqing LIlihanqing@cmbi.com.hk Stock Data Smartphone:stable 3Q shipments with flattish ASP;expect stronger 4QgrowthonXiaomi 17 momentum andDouble11 promotions.For 3Q25,Omdiareported Xiaomi’s global shipments of 43.5mn units (+1.8% YoY), and Xiaomimaintained No.3 rankingwith market share of 13.6%, driven by new modellaunchesand Europe & Latin America markets (Redmi Note/Poco). For 3Q25, we estimateASPtodecline slightlyQoQgiven higher mix fromlower-ASP overseasmarkets(e.g.India/Africa) andChina shipment decline. We expectresilientGPMat 11%despite concerns on memory cost hike. Overall, weremainpositive on Xiaomi’scontinuousglobal market share gains,premiumization strategy(Pro/Pro-max) andnew retail strategy expansion.Overall, we expect Xiaomi's shipments to grow3%/7%/5% YoY to174mn/185mn/195mn units in FY25-27E. Smart EV:strong3QASP/profitabilitybacked by SU7/Ultra deliveries.For EVsegment, weestimate 3Q deliveries of 109k and ASP of +5%QoQthanks to SU7delivery withhigher ASP and Ultra model shipment growth. Formargins, we expect3QGPMto slightly declineQoQto 25%,due tocapacity constraint onSU7orders.As for profitability, webelieveXiaomi’s EV business will achieve break-even in 3Qmainly on China’sfavourablepurchasetax subsidy,economies of scaleandsuperiormanufacturing efficiency. For FY25E, we expect 402kEV shipmentson strongYU7/Ultra orders and capacity expansion. IoT/Internet: stable internetgrowthbutsofterIoTbizon competitionandChinafadingsubsidies.We estimate internet biz revenue growth of8%YoY withflattishGPM at 75%in 3Q25E.For IoT biz, we expect revenueof +5% YoY/-29%QoQmainly on market competition andChinasubsidy effect fadingout.Earnings Summary Related Reports1.Xiaomi (1810 HK)-Product launch takeaways: Xiaomi 17 and EVcustomization services ’s competitivepricing; IoT upgrade and EVcustomization services–26 Sep 20252.Xiaomi (1810 HK)-2Q25 in line;Solid EV/IoT momentum offset bysofter smartphone outlook–20 Aug20253.Xiaomi (1810 HK)-2Q25 Preview:expect strong earnings backed byIoT/EV momentum and solidsmartphone–7 Aug 20254.Xiaomi (1810 HK)-Launch eventtakeaways: YU7, AI Glasses, MIX Flip2–27 Jun 2025 Focus Charts Source:Company data, CMBIGM estimates Source:Company data, CMBIGM estimates Source:Company data, CMBIGM Source:Company data, CMBIGM estimates Source:Company data, CMBIGM Source:Company data, CMBIGM 3Q25 Preview Earnings Revision WetrimourFY25-27E adj. net profitforecastsby3-4% to reflect softer SP business, EVbiz break-even in 3Q and higher BOM cost.Our FY25/26E adj. NP are slightly belowconsensus given our more conservative view onsmartphoneshipmentsand margins. Valuation Maintain BUY with new SOTP-based TP of HK$61.30 We derive our TP of HK$61.30based on the SOTP methodology in order to reflect differentgrowth profiles of Xiaomi’s various businesses. We maintain the same set of targetmultiples, andassign 26x/26x/25xFY25E P/E to its smartphone/AIoT/Internet businesses,which we think are justified given Xiaomi’s accelerated share gains in smartphone/IoTmarket, overseas expansion of its ecosystemandimproving profitability across segments.For EV business, we assignthesame2.0x FY26E P/S. In addition, we believe our impliedtarget multiples of 33.9x/26.5x FY25E/26E P/E are justified given upcoming productupcycles for its AI smartphone, IoT overseas expansion and EVshipment momentum.Upcoming catalysts include 3Q25 results,the Double11 festival, new product launches,and EV capacity expansion. Source: Bloomberg, CMBIGM Source:Bloomberg, CMBIGM Disclosures& Disclaimers Analyst CertificationThe research analyst who isprimary responsible for the content of this