Q423 performance: The profit side greatly exceeded expectations, with equal emphasis on implementation scale and profit 1) 23Q4: Xiaomi Group's revenue for the fourth quarter of '23 was 73.2 billion yuan, up 10.9% year on year; net profit was 4.7 billion yuan, up 50.3% year on year; adjusted net profit was 4.9 billion yuan, up 236.1% year on year. 2) Full year of 2023: Xiaomi's revenue was 271 billion yuan, down 3.2% year on year.
Net profit was 17.5 billion yuan, up 598.3% year on year; adjusted net profit was 19.3 billion yuan, up 126.3% year on year. Expenses for innovative businesses such as Xiaomi smart cars increased to 6.7 billion yuan this year, of which 2.4 billion yuan was in the fourth quarter.
Profit measurement: Xiaomi achieved an overall gross profit margin of 21.2% for the full year of 2023, an increase of 4.2 percentage points over the previous year; the gross margin of the smartphone business increased 5.6 percentage points to 14.6% year on year, the gross margin of the IoT and consumer products business increased 1.9 percentage points to 16.3% year on year, and the gross margin of the Internet business increased 2.4 percentage points year on year to 74.2% year on year.
SU7 officially launched, showing its core competitive advantage at a low price and high configuration
On March 28, the Xiaomi Auto Launch Conference was held. The first model, the SU7, offered a total of 3 configurations, namely the standard version, Pro, and Max versions, with prices of 215,900 yuan, 245,900 yuan, and 299,900 yuan. 1) Power aspect: The Xiaomi SU7 has two configurations (single motor and dual motor). The single motor is equipped in the standard version and Pro version, and the dual motor is equipped in the MAX version. The single-motor version is equipped with a 220 kW drive motor with a maximum power of 299 horsepower and a maximum torque of 400 Nm. The MAX version is equipped with two high-power motors at the front and rear. The maximum power of the front motor is 220 kW plus 275 kilowatts of the rear motor. The maximum total power of the system is 495 kW, the peak torque of the system is 838 Nm, the acceleration time for 100 kilometers is 2.78 seconds, and the maximum speed is 265 km/h; 2) Battery life: The MAX version is equipped with a 101 kilowatt hour battery pack, CLTC has a pure electric battery life of 800 km, and supports an 800V charging architecture. The standard version is equipped with a 73.6 kilowatt-hour battery pack with a pure electric range of 700 km; the Pro version is equipped with a 94.3 kilowatt-hour battery pack with a pure electric range of 830 km; 3) In terms of smart driving: Xiaomi smart driving is divided into two versions: pure vision solution and vision+lidar solution. Currently, both versions support high-speed NOA, valet parking, and smart parking functions; the Max version supports urban NOA and is expected to be launched nationwide in August this year. In addition to this, the SU7 is also fully equipped with Xiaoai's AI large model, which can control car windows, HUD, and other deep human-vehicle interactions.
The SU7 market is hot, and the situation has greatly exceeded expectations
Only 27 minutes after the SU7 was launched, Dading surpassed 50,000 units, and Dading nearly 90,000 vehicles in 24 hours. The market was very popular. According to official standards, the standard version and Max version will be delivered in advance at the end of April, and the Pro version will be delivered at the end of May. We expect the Xiaomi SU7 to sell around 80,000 units in 2024, which is expected to sell 10,000 units per month. We will pay close attention to subsequent production capacity.
Investment advice
Optimistic about the five core advantages of Xiaomi's automobile traffic+channels+intelligence+ecology+cost performance, it is expected to open up a new revenue growth curve for the company. We expect the company's revenue to be 3181/3619/402.3 billion yuan in 2024/2025/2026, achieving +17%/+14%/+11% year over year; adjusted net profit of 146.9/178.9/20.68 billion yuan, achieving -24%/+22%/+16% YoY, maintaining a “buy” rating.
Risk warning
Raw material costs for the hardware business have risen; production capacity in the automotive business has fallen short of expectations.