Connect with us

Hi, what are you looking for?

Tech & Science

Xiaomi admits it grew ‘too fast’

Xiaomi is one of many Chinese brands to have quickly found fame in recent years. Although its phones remain mostly confined to its native market, it has attracted some media attention in Europe and America.
However, the wider issues facing the global smartphone market haven’t helped Xiaomi in its quest for global domination. Combined with Western buyers’ existing attachments to brands like Apple and Samsung, the company has recently begun to run into problems when trying to find new buyers.
Xiaomi will not disclose how many handsets it shipped last year after experiencing weaker demand throughout 2016. Some analysts have suggested sales were down 27 percent during the third-quarter of the year, indicating the volatility associated with such rapid growth. In 2012, the firm sold 6.6 million phones. By 2015, the figure had increased by a factor of ten to 71 million shipments.
Xiaomi CEO Lei Jun has now admitted the company took too many risks in its bid to grow big quickly. In an open letter to the company, Jun explained that 2016 was an “exceptional and memorable” year but Xiaomi must scale back the pace going forward.
“Our accomplishments are impressive, but the challenges we faced were unforgettable,” Jun said. “In the first few years, we pushed ahead too fast. We created a miracle, but also drew on some long-term growth. So we have to slow down, further improve in some areas, and ensure sustainable growth for a long-term future.”
Jun suggested Xiaomi’s most difficult struggles are now behind it, implying the company is moving to a more resilient model of operations that will give it more stability in the future. He noted the smartphone supply chain is “extremely complex” though, something it learnt the hard way while suffering from component shortages for four months last year.
Xiaomi will concentrate on developments in five “core focus areas” in 2017, technological breakthroughs, a new retail strategy, globalisation, artificial intelligence and Internet finance. The company is especially interested in the latter two fields, aiming to expand its portfolio of products with new algorithms and banking solutions. It will need more money to pour into its projects though, so Xiaomi has a “humble goal” of making RMB 100 billion in revenue this year.
Xiaomi isn’t the only Chinese tech firm struggling to keep up momentum. Last year, rival LeEco admitted similar problems, saying it expanded too quickly and admitting it’s running out of money. The company is now facing problems when trying to raise new funds. The announcement came shortly after it unveiled a new range of products designed for international markets.

Written By

You may also like:

World

Calling for urgent action is the international medical humanitarian organization Doctors Without Borders/Médecins Sans Frontières (MSF)

Business

The cathedral is on track to reopen on December 8 - Copyright AFP Ludovic MARINParis’s Notre-Dame Cathedral, ravaged by fire in 2019, is on...

Business

Saudi Aramco President & CEO Amin Nasser speaks during the CERAWeek oil summit in Houston, Texas - Copyright AFP Mark FelixPointing to the still...

Business

A recent article in the Wall Street Journal infers that some workers might be falling out of the job market altogether.