According to the Stock Exchange of Hong Kong Limited (SEHK) today, Xiaomi
The prospectus disclosed that Xiaomi
According to the prospectus, in terms of the revenue from mainland China versus the rest of the world, 93.9%, 86.6% and 72.0% were the percentages of total revenues from mainland China in 2015, 2016 and 2017.
According to SEHK’s new policy, Xiaomi
“Dual-class share structure” is also called the AB share structure. The company’s executives hold Class A shares with more voting rights; ordinary shareholders hold Class B shares with less voting rights (one or no vote per share). For compensation, shares with more voting rights generally have poor liquidity. Once sold, they will be converted from Class A shares to Class B shares.
Lei Jun also issued an open letter to investors, saying that Xiaomi
Here is the open letter from Xiaomi
CEO and co-founder Lei Jun:
Thank you for your interest and support for Xiaomi
In this letter, I would like to share my personal thoughts on Xiaomi
We are more than a hardware company. We are an innovation-driven internet company.
Every day for the past eight years, our vision to be friends with our users and to be the “coolest company” in the hearts of our users has motivated us to pursue innovation and maintain an unwavering focus on quality and efficiency. This has resulted in us continually achieving many ground-breaking milestones.
We founded Xiaomi
“Amazing products” and “honest prices”come hand-in-hand. They are inseparable. Only through building amazing products that well exceed people’s expectations and offering them at honest prices,can we win over the hearts of our users. Pursuing innovative technology and outstanding design is in our DNA. Our engineers are obsessed with pushing the boundaries of technology, and they repeatedly craft every minute detail to ensure our products completely exceed our users’ expectations. We have the courage to break with convention and constantly improve ourselves, and these are the key reasons why we have been able to gain our users’ sustained trust and appreciation.
We promote a bold innovative culture,not limited to technology. We are innovative not only in smartphone technology, including materials, displays and SoCs, but also in design,where we have received over 200 globally acclaimed industrial design awards in the past few years. We have a unique “triathlon” business model and have built a one-of-a-kind ecosystem of companies. We have a unique engagement model with our online users, as well as a highly efficient new retail strategy incorporating both online and offline. The spirit of innovation is deeply ingrained in everything we do and motivates us to accelerate our exploration of uncharted waters.
Currently, we are the world’s fourth-largest smartphone company. We have created many smart hardware products,among which many are leaders in their respective categories. We have also built the world’s largest IoT platform with over 100 million connecteddevices. In addition,we have 190 million MIUI monthly active users who regularly use our innovative internet services.
What makes us even prouder is that we have completely transformed the industries that we participate in. We have driven the rapid adoption and quality improvement of smartphones in China, laying a strong foundation for the rise of the mobile internet in the country. The rapid development of mobile payments,e-commerce, social networking, and short-form videos in China can be largely attributed to the penetration of the mobile internet into the lives of hundreds of millions of people. China is now the world’s largest smartphone market with a strong and vibrant mobile internet industry. We believe our contributions to this have been widely recognized.
Good companies make profits, great companies also win over people’s hearts.We pride ourselves even more in being a technology company with a rare “fan culture.”We have a large global community of “Mi Fans,” passionate users who are intensely loyal to our brand, highly engaged on our platform and actively contribute feedback and feature ideas to our product development.
After a successful rebound, Xiaomi
’s business model has been proven again.
As a young Internet Company, Xiaomi
As far as we know, apart from Xiaomi
This was a turning point for Xiaomi
More importantly, our business model was tested and proven again.
This is our unique “triathlon” business model, which encompasses hardware,new retail and internet services. Xiaomi
The increase in efficiency comes from lowering operating costs, especially sales and marketing costs. Xiaomi
We pledge that our overall hardware net profit margin will never exceed 5%.
During the early years of Xiaomi
For example,in China, a shirt that costs US$15 to producemay retail for as much as US$150. This is a shockingmarkup of 10 times. A pair of shoes may be marked up by 5 to 10 times, and a tie can be marked up by 20 times. The list is endless.
It has always been difficult for me to understand why businesses are so inefficient. Why do users have to bear the costs of inefficiency? Cost reduction efforts are usually focused on reducing production costs, which may account for only 10% of total costs. Rarely do companies focus on eliminating the inefficiencies in sales, marketing and operations, which may account for 90% of total costs.
At the beginning of 2011, during your first employee annual meeting, I told more than 100 employees and their families that we wanted to make smartphones with the best performance and user experience, and sell them for only US$300. At that time, similar smartphones were selling for more than US$600.
Great companies are always focused on creating quality products and selling them at better and better prices so that users can get their money’s worth.
Our answer is that users have always expected amazing products at honest prices.
Many of our users tell us that when they browse Mi Store or visit a Mi Home, they can buy any of our products with full confidence, because they know these products have the best quality and price. When I hear this, I know that all of our energy and efforts are worth it. This is ultimately our goal.
Our users’ trust is the foundation of our business and efficiency is the soul. As long as we continue to earn the trust of our users, our business will continue to perform well. A company that is able to achieve world-class efficiency will have the ability to survive multiple economic cycles, continuously seize new opportunities in the industry,and sustain excellent operational performance in the long run.
“Amazing products,honest pricing” comes with real action. At this point,I would like to pledge to our existingand potential users: starting in 2018, Xiaomi
It is our belief that delivering sustained, high quality user experience is more important than pursuing one-time hardware profits. Focusing on efficiency is more important than short-term profits. We are confident that maintaining reasonable profits will inevitably become an industry trend. Blindly pushing for higher margins will not be sustainable.
Therefore, I would like to emphasize that we will focus on upholding our users’ and our company’s long-term interests, which in turn creates more value for our shareholders.
It is our ultimate commitment to efficiency to cap our hardware business net profit margin at 5%. We know that it may take time for everyone to fully embrace our ideals. However, time is on outside. Our steadfast determination and execution will eventually help us to realize our dreams.
Building an open global ecosystem, our potential has no boundaries
Today, we present ourselves to you as we prepare to enter a new stage in our journey. We believe that the potential of our global business is only limited by our imagination.
We are building an open global ecosystem, and nota walled garden. To let everyone on earth enjoy a better life through innovative technology, one “Xiaomi
With our unique ecosystem model, we have mobilized many like-minded entrepreneurs. We are not alone. Together, we have created a comprehensive suite of products that revolve around our smartphones, including mobile peripherals, smart hardware and lifestyle products.Currently, Xiaomi
We are not only changing industries in China, but also elsewhere in the world. Among the more than 70 countries and regions that we have entered, we are number one in India in terms of smartphone market share and are among the top 5 smartphone companies in 15 countries. We will continue to prove that Xiaomi
Building a global ecosystem has provided Xiaomi
The spirit of engineering runs in our veins. This spirit drives us to relentlessly explore the most advanced technologies in order to benefit as many users as possible and to be the coolest company in the hearts of our users. We believe that everyone in the world should enjoy a better life through innovative technology.
Fundamentally, the Internet is all about transparency, efficiency, and equality. We want to allow everyone, regardless of gender, ethnicity,religion, nationality, or education level, to enjoy the benefits of technology.
This is the goal that all Xiaomi
Thank you for your interest in Xiaomi
To gift honesty to business, to gift warmth to technology, to gift happiness to everyone, our mission has no boundaries, and we have only just begun. We have changed how hundreds of millions of people live, and we will become a part of the lives of billions of people globally in the future.
Good things happen to good people. Please join us on our journey. Always believe.