E-Paper
Chinese smartphone maker Xiaomi lays off 900 employees: Report
Xiaomi's sales fell to 70.17 billion yuan ( ₹8,226 crore) thereby marking a steep decline from the previous quarter when the company had posted its first revenue drop since listing, Reuters reported.
Chinese smartphone manufacturer Xiaomi has laid off more than 900 employees, i.e nearly three per cent of its workforce, South China Morning post reported. According to the report, the smartphone maker had 32,869 employees, down from 33,793 employees at the end of March this year. The layoffs come amid drop in revenue by 20 per cent this year.
The sales fell to 70.17 billion yuan ( ₹8,226 crore) thereby marking a steep decline from the previous quarter when the company had posted its first revenue drop since listing, Reuters reported.
The net income also plummeted 67 per cent to 2.08 billion yuan. Xiaomi's president Wang Xiang cited resurgence of pandemic and said the demand was difficult and weak.
Xiang also added that rising fuel prices, input costs, and inflation affected overseas sales as well. Net profit fell as a result of pressure to clear inventory via sales and promotions.
China's consumer market has struggled to rebound from the impact of lockdowns in Shanghai and other cities. According to data, the Chinese economy slowed in July, struggling to shake off the June quarter's hit to growth from COVID restrictions, prompting a central bank rate cut.
China's long-stagnant smartphone sector has been especially hit by the downturn, with unit shipments down 10% year on year in the second quarter, according to research firm Canalys.
Xiaomi's smartphone sales, which generate more than half of the company's total revenue, fell 29%.
In 2021, Xiaomi saw a sales surge after it grabbed market share from rival Huawei Technologies Co Ltd, whose ability to procure components was crippled by U.S. sanctions.
Yet the bump was short-lived, and the company's stock price has tumbled nearly 40% since the start of 2022, hit by the slowing Chinese economy and weakening overseas growth.
(With Reuters inputs)
