Xiaomi lays off 900 employees as revenue dips amid slowing Chinese economy: report

Xiaomi lays off 900 employees amid slowing Chinese economy

Photo: BCCL

Chinese smartphone giant Xiaomi is said to have laid off more than 900 employees, cutting its workforce by nearly 3%. The company posted a second straight annual decline in quarterly earnings during the April-June period, a steeper drop than the previous quarter’s revenue. Xiaomi recorded its first-ever quarterly revenue decline in the first quarter amid a slowing Chinese economy.

China’s biggest smartphone maker said on Friday its second-quarter net profit fell 83% from a year earlier due to lower smartphone revenue, attributing the lull to global macroeconomic turmoil. and the resurgence of Covid-19. The Chinese electronics maker’s net profit in the quarter fell to 1.39 billion yuan ($204.80 million) from 8.7 billion yuan in the same quarter last year.

The company, which has yet to confirm the South China Morning Post report, reported a second straight decline in second-quarter profit as sales fell 20% year-on-year to 70.17 billion yuan or 10 .31 billion.

“In the Chinese market, there has been the resurgence of the pandemic, so as a result, demand has been difficult and weak,” Xiaomi Chairman Wang Xiang said on an earnings call.

China’s economy slowed unexpectedly in July as the world’s second-largest economy struggles to emerge from the slowdown that began in the previous quarter under a relentless zero Covid policy.

The Chinese smartphone maker is also facing regulatory and tax issues in one of its biggest markets: India.

The Indian government is investigating alleged tax evasion by Chinese smartphone makers such as Oppo Mobiles, Vivo India and Xiaomi, and notices have already been served on them, Finance Minister Nirmala Sitharaman said.

The Department of Revenue Intelligence (DRI) has issued a notice to mobile phone company Oppo for a total customs duty of Rs 4,389 crore on the grounds of misdeclaration of certain goods resulting in a short payment of customs duty. “

We believe the customs evasion is around Rs 2,981 crore,” the FM added. “The undervaluation of imported goods for the purpose of paying customs duties, which we believe to be an evasion of Rs 1,408 crore,” she said.

“Three show cause notices were issued to them and the approximate duty obligation is around Rs 653 crore. For the three show cause notices they were issued, they only deposited Rs 46 lakh,” Sitharaman said. in the Upper House of the Indian Parliament earlier.

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