Can Xiaomi’s Multi-Pronged Strategy Propel Its Shares Past $40?

Xiaomi's equity presents a complex narrative. On one hand, corporate leadership is executing a vigorous share repurchase program, signaling strong internal confidence. On the other, the stock's price movement remains tentative despite record-breaking performance in its electric vehicle division. This divergence prompts a key question: is the market missing the long-term potential of Xiaomi's integrated "Human x Car x Home" ecosystem while focusing on short-term profit-taking?

The operational story is particularly compelling in the automotive sector. For the third consecutive month, Xiaomi's electric vehicle deliveries exceeded 40,000 units in November. This milestone means the company has already surpassed its initial 2025 annual target of 350,000 vehicles. Cumulative deliveries since the launch of its car business have now crossed the half-million mark—a notable achievement for a manufacturer in series production for less than two years.

In light of this sustained success, management has upwardly revised its full-year delivery forecast, now targeting over 400,000 units. Market observers are shifting their focus toward profitability metrics, anticipating that margins will benefit from an increasing mix of higher-end models like the SU7 Ultra and the new YU7 SUV.

Management's Vote of Confidence Through Buybacks

Concurrent with its automotive triumphs, Xiaomi's board is backing its conviction with capital. As recently as Wednesday, the company intervened heavily in the market, repurchasing shares worth approximately $39 million. This aggressive buyback strategy serves as a clear statement: leadership believes the stock is significantly undervalued, even after recent minor price corrections.

Should investors sell immediately? Or is it worth buying Xiaomi?

AI Advancements and Market Sentiment

Beyond hardware, Xiaomi is pushing forward with software integration. Company President Lu Weibing announced that progress in developing large AI models has "far exceeded expectations." This growing software prowess is viewed as critical for maintaining the competitiveness of its interconnected ecosystem of smartphones, automobiles, and smart home devices.

Nevertheless, the market's immediate reaction to these positive developments has been muted. Shares experienced slight pressure on Wednesday despite the news. Year-to-date performance, however, remains solid with an advance of over 17%. The apparent disconnect between fundamental strength and near-term share price action continues to be a point of analysis.

The Path to a Key Psychological Level

Is the technology conglomerate attempting too much simultaneously? Current developments reveal a company actively supporting its share price, accelerating its auto business, and investing in artificial intelligence—all in parallel. Whether this multi-front strategy will finally deliver the long-awaited breakthrough above the psychologically significant $40 threshold will depend on the continued successful execution of its operational plans.