On March 22, Xiaomi announced its results for the fourth quarter and full year of 2021.
Among them, Xiaomi's revenue in the fourth quarter was 85.575 billion yuan, up 21.4% year-on-year; the profit during the period was 2.4 billion yuan, down 72.2% year-on-year. For the whole year of 2021, the total revenue of Xiaomi Group was 328.309 billion yuan, an increase of 33.5% year-on-year; The annual profit was 19.283 billion yuan, down 5.1% year-on-year; the adjusted net profit was 22.040 billion yuan, an increase of 69.5% year-on-year.
Although Lei Jun has not wanted the outside world to regard Xiaomi as a hardware manufacturer of mobile phone manufacturing, the sharp rise in Xiaomi's net profit this time is largely due to the good performance of the smart phone business. According to Canalys data, Xiaomi's global smartphone shipments in 2021 increased by 30.0% year-on-year to 190 million units, ranking third in the world, with a market share of 14.1%.
At the same time, the gross profit margin and revenue of Xiaomi's mobile phone business as a proportion of total revenue have also become higher and higher. This is the opposite direction of the business model that Lei Jun tried to establish at the beginning to obtain customers on hardware and monetize software services.
"Mobile phone ×AIoT", walking on one leg
Xiaomi's "hard" is becoming an increasingly obvious trend, and this trend is difficult to change in a short period of time.
In the annual revenue of 2021, Xiaomi's smartphone business revenue was 208.869 billion yuan, accounting for 63.6% of the total revenue, compared with 61.9% in 2020. At the same time, Xiaomi's IoT revenue in 2021 was 84.980 billion yuan, accounting for 25.9% of total revenue, down 1.5 percentage points from 2020; Internet service revenue was 28.212 billion yuan, accounting for 8.6% of total revenue, down 1.1 percentage points from 2020.
Xiaomi explained in its earnings report that the revenue of the smartphone business rose due to the increase in sales volume and average selling price (ASP). Among them, the average selling price of Xiaomi mobile phones increased from 1039.8 yuan per unit in 2020 to 1097.5 yuan, an increase of 5.6% year-on-year.
The rise in ASP was mainly due to the increase in the proportion of high-end mobile phone shipments. In 2021, Xiaomi's high-end smartphone shipments increased from 7% in 2020 to 13%.
This also means that Xiaomi's mobile phone hardware revenue has become a veritable "cash cow" and decisively affects xiaomi's overall revenue performance.
The role of AIoT business revenue in overall revenue is becoming weaker and weaker compared to hardware revenue. The dual business strategy of "mobile phone × AIoT" is showing a one-legged situation. As for the Internet business that Lei Jun hopes to do, the role played in driving the overall revenue is almost better than nothing.
However, in the performance of gross profit, the natural high gross profit attribute of the Internet business also adds a lot of color to Xiaomi's overall profit.
For the whole year of 2021, the gross profit of Xiaomi's mobile phone business was 24.86 billion yuan, an increase of 88.3% year-on-year, accounting for 42.7% of the overall gross profit, and the gross profit margin was 11.9%; the gross profit of Internet services was 20.9 billion yuan, an increase of 42.7% year-on-year, accounting for 35.9% of the overall gross profit, and the gross profit margin was as high as 74.1%.
In contrast, IoT's profit performance is mediocre. For the full year of 2021, the gross profit of Xiaomi's IoT business was 11.1 billion yuan, an increase of 29% year-on-year, and the gross profit margin was 13.1%.
Internet business, make the least money and eat the most losses
Although Xiaomi's Internet business accounts for a very small proportion of overall revenue, Xiaomi pays a large price for it.
In the 2021 financial report, Xiaomi's annual profit was 19.283 billion yuan, down 5.1% year-on-year; adjusted net profit was 22.040 billion yuan, an increase of 69.5% year-on-year. Why is xiaomi's profit performance far behind after the adjustment? Analysis of the financial report data will find that this contrast mainly comes from the change of two financial indicators.
During the reporting period, the change in the fair value of Xiaomi's fair value investments included in profit and loss in 2021 was 8.1 billion yuan, a decrease of 38.3% compared with 13.2 billion yuan in 2020, mainly due to the decrease in fair value gains on listed common stock investments. According to the financial report, as of December 31, 2021, Xiaomi has invested in more than 390 companies.
This means that in the stock market shock caused by last year's Chinese stock crisis, Xiaomi's investment shrank by about 5.1 billion yuan, accounting for about 25% of the total net profit.
At the same time, Caixin reported in August 2021 that state regulators are considering tightening the eligibility criteria for "key software companies" and proposing stricter requirements for tax breaks enjoyed by Internet companies.
According to the existing tax policy, the enterprise income tax rate is 25%, and the enterprises identified as key software enterprises enjoy the "two exemptions and three halves" preferential treatment of enterprise income tax, that is, from the first year of profit, two years of income tax are exempted, and then half of the three consecutive years; if the enterprise obtains the qualification of the national key software enterprise, it can also enjoy a preferential corporate income tax rate of 10% every year.
Obviously, the Internet business, which accounts for the smallest proportion of millet revenue, is also within the scope of this tax adjustment. A data that can be confirmed is that xiaomi's income tax expense in 2020 is 1.32 billion yuan, and in 2021, this cost expenditure directly rises to 5.13 billion yuan, and the income tax expense increases by 3.81 billion yuan in total.
It can be said that the increase in income tax and the shrinking of investment value caused by the "Internet hat" have brought a total of 8.91 billion yuan of financial losses to Xiaomi, equivalent to 46.2% of the net profit in 2021. This also explains that after adjusting the caliber of financial statistics, Xiaomi's net profit performance changed from a year-on-year decline of 5.1% to a year-on-year increase of 69.5%.
However, whether Xiaomi is an Internet company or not is actually not so important. As long as the company has money to earn, it doesn't matter if Xiaomi is "hard".
(This article was first published on the Titanium Media App, and the author |.) Rao Xiangyu)