Chinese smartphone maker Xiaomi cuts over 900 jobs, nearly 3 per cent of its workforce, as revenues shrink 20 per cent
- In the June quarter, net income fell 83.5 per cent to 1.4 billion yuan, compared with a profit of 8.3 billion yuan the same period last year
- Smartphone shipments decreased 26.2 per cent, primarily due to global macroeconomic headwinds and the resurgence of Covid-19 in China
Chinese smartphone company Xiaomi cut more than 900 jobs, or nearly 3 per cent of its workforce, over the past three months as revenues continued to shrink amid an economic slowdown.
Revenue reached 70.2 billion yuan (US$10.3 billion) in the second quarter, representing a 20 per cent year-on-year drop, a wider decline in revenue than the one reported in the last quarter.
In the three months ended June 30, net income also missed estimates, falling 83.5 per cent to 1.4 billion yuan, compared with a profit of 8.3 billion yuan the same period last year.
As of June 30, 2022, the Beijing-based company had 32,869 employees, compared with a total 33,793 employees at the end of March this year, meaning a loss of 900 jobs over the period.
“In this quarter, our industry faced many challenges, including rising global inflation, foreign exchange fluctuations [and] complex political environment,” said Xiaomi president Wang Xiang during a conference call after the earnings release. “These challenges significantly impacted overall market demand and our financial results for the period.”
China’s gross domestic product grew only 0.4 per cent in the second quarter, the worst since the first quarter of 2020, when the coronavirus outbreak shut down large swathes of the country, driving GDP down by 6.8 per cent.