China’s tech company Xiaomi has announced last Friday a wide high-level management transition, in which several young executives have been promoted to higher positions while two veterans left, as the company is gearing up to continue its push in 5G, Internet of Things (IoT) and global expansion, according to an internal letter obtained by local media.
In the leadership reshuffle, Lu Weibin, the man behind Xiaomi’s budget smartphone series Redmi, has succeeded Xiaomi’s founder Lei Jun as president of Xiaomi China, while former CFO Zhou Shouzi has been appointed as the new director of Xiaomi’s overseas operation.
Wang Xiang, who was responsible for globalization, has been promoted to become the company’s new president, and former president Lin Bin will take the position of vice-chairman of the board, as reported by 36kr. Also, Xiaomi’s co-founder Liang Wanqiang has left the company and former vice president Qi Yan has resigned.
“The next year will be critical for Xiaomi’s 5G business and the “Smartphone + AIoT” dual-engine strategy, therefore, we need stronger management and a job rotation system to support the progress and activate the team,” Lei Jun wrote in the letter.
The reshuffle comes right after the Hong Kong-listed company disclosed its third-quarter earnings report, which delivered better-than-expected results but also highlighted a notable drop in domestic smartphone shipments.
Xiaomi reported quarterly total revenues of RMB 53.7 billion (USD 7.6 billion), with a tad year-on-year rise of 5.5%—the slowest-ever growth since July 2018 when the company got listed in Hong Kong, KrASIA reported. The smartphone segment, its core business, saw a continuous decline in domestic shipment and revenues, down 7.8% year-on-year to RMB 32.3 billion (USD 4.6 billion), mainly attributed to a downturn in China’s smartphone market and the fierce competition from rival powerhouse Huawei.
The firm delivered positive growth in its IoT and Lifestyle products unit, where its revenues went up 44% to RMB 15.6 billion (USD 2.2 billion), as part of Xiaomi’s so-called “Smartphone + AIoT” strategy, which accounted for one-third of the company’s overall revenues.
Xiaomi’s leadership shakeup might want to boost the company’s 5G smartphones strategy, and put additional emphasis on the IoT and smart home appliances sector. “We believe that 5G will, in the next couple of years, bring new growth opportunities to Chinese smartphones,” said during the third-quarter earnings call the newly-appointed overseas operation director Zhou.
Notably, in this leadership reshuffle, part of the staff responsible for the company’s positive overseas results got promoted, including Lu and Wang. Industry watchers indicated that this probably marks Xiaomi’s non-stopping ambition in markets outside of China.
For the third quarter, Xiaomi’s global unit brought RMB 26.1 billion (USD 3.7 billion) to the company, accounting for nearly half of total revenues. The company reported a year-over-year growth of 90.9% of smartphone sales in Western Europe, where it ranked 4th in terms of market share, while it also retained the number one smartphone position in India for nine consecutive quarters.
It is expected that large-scale commercial use of 5G networks and devices will come in the foreseeable future, and Xiaomi is betting bigger on this market. Lei said that at least ten Xiaomi 5G-compatible smartphone models will debut in 2020.