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XIAOMI CORPORATION

小米集團

(A company controlled through weighted voting rights and incorporated in the Cayman Islands with limited liability)

(Stock Code: 1810)

RESULTS ANNOUNCEMENT

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2021

The board (the "Board") of directors (the "Directors") of Xiaomi Corporation 小米集團 (the "Company") is pleased to announce the unaudited consolidated results of the Company and its subsidiaries (collectively, the "Group") for the three and six months ended June 30, 2021. These interim results have been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting", and reviewed by PricewaterhouseCoopers, the independent auditor of the Company, in accordance with International Standard on Review Engagements 2410, "Review of interim financial information performed by the independent auditor of the entity", issued by the International Auditing and Assurance Standards Board. The interim results have also been reviewed by the audit committee of the Company (the "Audit Committee").

In this announcement, "we", "us", and "our" refer to the Company and where the context otherwise requires, the Group.

KEY HIGHLIGHTS

Unaudited

Three months ended

Quarter-

Year-

over-

June 30,

June 30,

over-year

March 31,

quarter

2021

2020

change

2021

change

(Renminbi ("RMB") in millions, unless specified)

Revenue

87,789.0

53,537.8

64.0%

76,882.2

14.2%

Gross profit

15,148.1

7,701.4

96.7%

14,161.3

7.0%

Operating profit

10,725.7

5,413.0

98.1%

8,157.7

31.5%

Profit before income tax

9,678.5

4,867.8

98.8%

9,066.9

6.7%

Profit for the period

8,263.3

4,493.5

83.9%

7,788.9

6.1%

Non-IFRS measure:

  Adjusted Net Profit

6,321.5

3,373.2

87.4%

6,069.3

4.2%

1

Unaudited

Six months ended

Year-

June 30,

June 30,

over-year

2021

2020

change

(RMB in millions, unless specified)

Revenue

164,671.2

103,240.0

59.5%

Gross profit

29,309.4

15,259.9

92.1%

Operating profit

18,883.4

7,736.2

144.1%

Profit before income tax

18,745.4

7,321.9

156.0%

Profit for the period

16,052.2

6,653.4

141.3%

Non-IFRS measure: Adjusted Net Profit

12,390.8

5,673.7

118.4%

BUSINESS REVIEW AND OUTLOOK

1. Overall Performance

In the second quarter of 2021, our total revenue amounted to RMB87.8 billion, representing an increase of 64.0% year-over-year; profit for the period was RMB8.3 billion, an increase of 83.9% year-over-year; adjusted net profit for the period was RMB6.3 billion, an increase of 87.4% year-over-year. Our total revenue and adjusted net profit both reached record highs in the quarter.

Our core "Smartphone × AIoT" strategy continued to underpin our outstanding performance. According to Canalys, in the second quarter of 2021, our global smartphone shipments ranking rose to No. 2 for the first time, with a market share of 16.7%. Our smartphone shipments in mainland China ranked among the top three, with a market share of 16.8%. Due to the strong growth in smartphone shipments, we achieved new record high monthly active users ("MAU") of MIUI both globally and in mainland China in June 2021, reaching 453.8 million and 124.0 million, respectively. At the same time, our AIoT platform continued to expand, with the number of connected IoT devices (excluding smartphones and laptops) on

our AIoT platform reaching 374.5 million as of June 30, 2021. In June 2021, the MAU of our AI assistant ("小愛同學") exceeded the 100 million mark for the first time, reaching 102.0 million.

We further strengthened our online and offline channels in mainland China. During the 618 e-Commerce Shopping Festival in 2021, Xiaomi's full spectrum of products gained widespread popularity, with total gross merchandise value from all sales channels exceeding RMB19.0 billion, representing an increase of 90% year-over-year. The sales volume of our smartphones ranked No. 1 among Android smartphones sold through major e-commerce platforms, and our IoT products achieved 158 No. 1 rankings in their respective categories across major e-commerce platforms. Meanwhile, we continued to expand our offline presence, with the total number of our retail stores in mainland China grew to more than 7,600 as of June 30, 2021. According to third party data, the offline market share of our smartphone shipments in mainland China grew to 7.8% in the second quarter of 2021 from 7.0% in the first quarter of 2021.

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Our overseas business also maintained strong growth momentum. In the second quarter of 2021, our revenue from overseas markets amounted to RMB43.6 billion, reaching an all-time high and representing a year-over-year increase of 81.6%. According to Canalys, in terms of smartphone shipments, we ranked No. 1 in 22 markets worldwide and ranked No. 1 for the first time in Europe, with a market share of 28.5%.

We have never stopped exploring advanced and pioneering technologies since our inception. At our launch event on August 10, 2021, we debuted several new products, including the smartphone with the full screen display Xiaomi MIX 4, Xiaomi Pad 5 Series, Xiaomi TV Master 77" OLED, the high-fidelity smart speaker Xiaomi Sound, and CyberDog, our bio-inspired quadruped robot. In July 2021, we officially broke ground on the Xiaomi Smart Factory Phase

  1. located in the Changping district of Beijing ("Changping Smart Factory"). This facility will build upon our R&D and production capabilities at our Xiaomi Smart Factory Phase I, located in the Yizhuang area of Beijing ("Yizhuang Smart Factory"), and marks an important step in Xiaomi's development in the smart manufacturing industry.

Our achievements have been globally recognized. August 2021 marked our third consecutive entry into Fortune Global 500 list, ranking 338th, advancing 84 spots from its ranking in 2020. In addition, in June 2021, Xiaomi was included on the BrandZTM Top 100 Most Valuable Global Brands list for the third consecutive year, with its ranking rising to 70th.

2. Smartphones

Our smartphone business continued to exhibit significant growth in the second quarter of 2021, highlighted by record-breaking smartphone revenue and shipments. Smartphone revenue amounted to RMB59.1 billion in the second quarter of 2021, representing an increase of 86.8% year-over-year. Our global smartphone shipments reached 52.9 million units, representing an increase of 86.8% year-over-year. According to Canalys, our global smartphone shipments ranked No. 2 for the first time, with a market share of 16.7% in the second quarter of 2021. Meanwhile, our smartphone shipments in mainland China also grew rapidly. According to Canalys, in the second quarter of 2021, our smartphone market share in mainland China rose to 16.8% from 10.3% in the second quarter of 2020, ranking third with a 35.1% year-over-year increase in smartphone shipments, the highest growth rate among major players in the market.

We continue to execute our dual-brand strategy. Under the Xiaomi brand, we remain focused on enriching our premium smartphone portfolio. Following the widespread popularity of Xiaomi 11 Pro, Xiaomi 11 Ultra and Xiaomi MIX FOLD in the first quarter of 2021, on August 10, we unveiled our first camera-under-panel full display smartphone Xiaomi MIX 4, wrapped with lightweight fine ceramic unibody. It supports our "Point to Connect" Ultra Wide Band (UWB) technology, and is the first smartphone in the market equipped with Qualcomm Snapdragon 888+ processor. Xiaomi MIX 4 was well received by the market since its launch. According to third party data, in the second quarter of 2021, our smartphones in mainland China with prices between RMB3,000 and RMB4,000, RMB4,000 and RMB5,000, and above RMB5,000, witnessed a year-over-year net market share gain of 8.4, 4.1, and 3.6 percentage point, respectively. In the first half of 2021, the global shipments of our smartphones with retail prices at or above RMB3,000 in mainland China and EUR300 or equivalent in overseas markets exceeded 12 million units, surpassing the total of around 10 million units shipped in 2020.

3

Our Redmi brand continues to provide competitive products. As of April 30, 2021, accumulated global shipments of the Redmi Note Series surpassed 200 million units, reflecting increasing mass-market resonance of our Redmi brand and the high quality of Redmi smartphones. On May 26, 2021, we unveiled the Redmi Note 10 series in mainland China, where it enjoyed an enthusiastic reception.

Looking forward, we will continue to execute our dual-brand strategy, boost investments in advance technology, recruit and foster talent and upgrade channel capabilities, enhance our premium smartphone offerings and improve user experience.

3. IoT and lifestyle products

In the second quarter of 2021, our IoT and lifestyle products segment maintained robust growth, with revenue increasing 35.9% year-over-year to RMB20.7 billion.

In the second quarter of 2021, global shipments of our smart TVs surpassed 2.5 million units, maintaining our leading market position. According to All View Cloud ("AVC"), our TV shipments ranked No. 1 in mainland China for the 10th consecutive quarter and remained among the top five globally in the second quarter of 2021. In addition, we further expanded premium and ultra-large screen TV portfolio, including the Xiaomi TV 6 Ultra Edition, the Xiaomi TV ES series, Xiaomi TV Master 77" OLED and the Xiaomi TV 6 OLED, which have been well received by the market.

On August 10, 2021, we launched the Xiaomi Pad 5 Series with features including our proprietary MIUI for Pad operating system, an 11-inch 2.5K ultra high performance LCD panel, and a Qualcomm Snapdragon 860/870 processor. We also released Xiaomi Sound, a high-fidelity smart speaker. Embedded with a Harman audio system and enabled with 360° omni-directional sound output, it delivers best-in-class sound quality. The Xiaomi Sound debut reflects Xiaomi's efforts in smart speaker products and technology advances in high-fidelity sound products. We also took another bold step in the exploration of futuristic technology with the debut of CyberDog. It is our first bio-inspired quadruped robotics product, and an open- source robot companion that developers can build upon.

In the second quarter of 2021, our IoT and lifestyle product segment also maintained its rapid growth trajectory in overseas markets. Revenue from our IoT and lifestyle products in overseas markets increased by 93.8% year-over-year in the quarter. Our electric scooters, smart TVs, smart bands, and smart watches maintained their widespread popularity in the overseas market.

Going forward, we will remain committed to our core "Smartphone × AIoT" strategy, working fervently to advance innovations in sophisticated and cutting-edge technologies across product categories. We will also continue enhancing connectivity between our smartphones and IoT products to deliver a seamless user experience across our range of high-quality products, bringing a better life to everyone in the world.

4

4. Internet services

Our internet services segment maintained its growth momentum. In the second quarter of 2021, revenue from internet services amounted to RMB7.0 billion, reaching a record high and representing an increase of 19.1% year-over-year.

Our global internet user base continued to expand rapidly and reached an all-time high in the second quarter of 2021. In June 2021, the MAU of MIUI increased 32.1% year-over-year to 453.8 million, with MAU in mainland China reaching 124.0 million, representing a year-over- year increase of 13.0% and a net gain of 5.3 million users from March 2021. In June 2021, the MAU of our global smart TV and Xiaomi Box increased over 34.0% year-over-year. As of June 30, 2021, our number of TV paid subscribers increased to 4.7 million, an increase of 17.1% year-over-year.

In the second quarter of 2021, our quarterly advertising revenue reached another record high of RMB4.5 billion, representing an increase of 46.2% year-over-year. Our gaming revenue in the second quarter of 2021 decreased by 10.7% year-over-year to RMB0.9 billion, due to an adjustment of our business terms with certain game publishers and the high base of last year. In the second quarter of 2021, revenue from other value-added services amounted to RMB1.6 billion, a decrease of 10.3% year-over-year, primarily due to our strengthened risk controls and continued management of the scale of our fintech business to ensure stable operations.

In the second quarter of 2021, our overseas internet services revenue amounted to RMB1.1 billion, representing an increase of 96.8% year-over-year. In this quarter, our overseas internet services revenue accounted for 15.6% of the total internet services revenue. Overseas internet services revenue and its contribution to total internet services revenue both reached new highs. On one hand, we continued to expand our user base in key overseas markets. In June 2021, our MIUI MAU in Western Europe and Latin America grew over 60% and 125% year-over- year, respectively. On the other hand, we continued to strengthen our capabilities in providing internet services through broader and deeper collaborations with leading internet companies globally.

Looking forward, we are committed to providing diversified internet service offerings to our global user base and enhancing their smart living experiences.

5. Overseas markets

In the second quarter of 2021, we maintained our strong growth momentum in overseas markets, delivering record-breaking performance in major markets around the world. In the second quarter, our revenue from overseas markets increased by 81.6% year-over-year to RMB43.6 billion, reaching a record high and accounting for 49.7% of total revenue.

According to Canalys, our market share in the second quarter ranked among the top five in 65 markets globally and No. 1 in 22 markets, 10 of those we achieved No. 1 for the first time.

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Xiaomi Corporation published this content on 25 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 August 2021 13:14:20 UTC.