• Sales of mobile devices decreased by 11%.
• Shipments of smartphones worldwide are at their lowest levels in years.
• According to reports, Xiaomi increased its market share in Europe.

Xiaomi's quarterly sales decreased by roughly 10% as it struggled with a faltering global smartphone market and weak domestic consumer demand.Mobile device sales decreased by 11%, leading decreases in all industry sectors, including smart electronics and internet services. 

The Beijing-based company reported sales that were marginally higher than forecasts at CNY 70.5 billion (approximately Rs. 80,900 crore). However, it unexpectedly reported a net loss for the quarter ending in September of CNY 1.5 billion (approximately Rs. 1,711 crore), which was due to a write-down of almost CNY 3 billion (roughly Rs. 3,422 crore) for things like investment losses. Analyst expectations were surpassed by adjusted net income, which excludes exceptionals.

The Covid Zero policy in China has disrupted the nation's supply networks and tech industry, which has lowered economic activity. Meanwhile, as consumers respond to high inflation and sluggish economic growth, demand for electronics is declining. 

Xiaomi gained market share in Europe despite the fact that global smartphone shipments are at their lowest level in years as a result of weak demand, executives said reporters during a conference call. Covid is a problem in China, and the pandemic situation is still unstable, according to President Wang Xiang. In foreign markets, he continued, 'there's still room for growth.'

According to a forecast made by Jefferies this month, global smartphone sales will drop by 2.9 percent the next year, following a 12.2 percent loss in 2022. According to Jefferies, Xiaomi's unit sales would decline this year and the following before marginally increasing in 2024.

This is partially due to the well-built phones launched in recent years, which have reduced the need for consumers to buy new phones, according to a note published on November 9 by Jefferies analysts Edison Lee and Nick Cheng. And according to them, new models only offer a few advances. 

Bloomberg Intelligence's Opinion Even though the decline in shipping volume shrank in September, the decline in smartphone sales in China may last until 2023. The debut of the iPhone 14 might provide a temporary lift, but Android's weakness appears to be overwhelmingly strong in the months to come. 

According to BI analysts Steven Tseng and Sean Chen, persistent declines in corporate PC shipments show that the business perspective is still cautious following the shutdown. The first quarter saw Xiaomi declare its first sales decline, which was followed by a June quarter sales decline of 20%.

Even the world's leaders aren't immune. The largest producer of phones, screens, and memory in the world, Samsung Electronics, pointed to declining mobile sales in China as a hindrance to its components business. People with knowledge of Apple Inc.'s intentions have stated that the company now anticipates producing at least 3 million less iPhone 14 phones this year than initially projected.

This is mainly because demand for the model's more affordable variations has been weaker than expected. Since the beginning of the year, Xiaomi's stock has lost half of its value, giving the electronics giant a $31 billion market cap. Nevertheless, because of its greater worldwide footprint and distribution, it has performed better than some of its domestic phone-making competitors, including Oppo and Vivo.