Gasgoo Munich-Xiaomi Group released its financial report for the first quarter of 2026. While the group's overall revenue and net profit faced year-on-year pressure, the automotive business turned in a performance of positive growth. During the subsequent earnings call, management revealed further details behind the numbers. From delivery volumes and revenue to technological R&D and global expansion, Xiaomi EV's progress this quarter highlights several trends worth watching.
Q1 Deliveries Hit 80,900 Units; Revenue at 19 Billion Yuan, Operating Loss at 3.1 Billion Yuan
In the first quarter, revenue for the innovation business segment—covering smart EVs and AI—reached 19.9 billion yuan, up 6.9% year-on-year. This accounted for over 20% of total group revenue. Of that, smart EV revenue alone stood at 19 billion yuan, a 5.1% annual increase. During the period, Xiaomi EV delivered 80,856 new vehicles, a 6.6% rise from the same time last year.
Image Source: Xiaomi EV Financial Report Screenshot
The new SU7 has seen a warm reception since launch. As of May 6, just 48 days after sales began, cumulative locked orders exceeded 80,000 units. In terms of segment rankings, terminal sales data from January to April 2026 show the Xiaomi SU7 taking the top spot among pure electric sedans priced above 200,000 yuan. Meanwhile, the Xiaomi YU7 ranked second in SUV sales.
On the sales network front, Xiaomi EV had opened 490 stores across 143 cities in mainland China by the end of the period.
On the profitability front, impacted by vehicle purchase tax subsidies and rising core component costs, Xiaomi EV's gross margin for the quarter was 20.1%. This resulted in an operating loss of 3.1 billion yuan. By contrast, the business had achieved positive quarterly operating income in the third and fourth quarters of 2025. This swing suggests that profitability remains susceptible to external environmental factors.
Regarding its full-year target, Xiaomi Group is holding to its previous outlook. CFO Alain Lam stated on the call that the company remains committed to its delivery target of 550,000 units set at the start of the year. He noted that more innovative models will launch in the second half. These models will "reflect Xiaomi's understanding of different markets and user groups," he said. Cumulative deliveries for the first four months of the year have surpassed 109,000 units. This completes roughly 19.8% of the annual goal.
Image Source: Xiaomi EV
On the production front, Beijing's Phase 1 and Phase 2 plants are running at full capacity. Phase 3 came online after the Lunar New Year. The Wuhan plant also began production in May. Overall annual capacity is projected to exceed 600,000 units, providing a solid foundation for future deliveries.
Xiaomi Group Partner and President Lu Weibing also expressed confidence during the call. He stated that the automotive business "has withstood severe challenges and passed the most difficult moments." Addressing rumors regarding a large SUV named "YU9," Lu clarified that the model is not called YU9. He emphasized that the new vehicle will definitely launch within the year and will feature "a great deal of innovation."
Q1 R&D Investment Reaches 9 Billion Yuan; Official Global Expansion Set for 2027
Beyond operational metrics, the evolution of R&D spending and technology roadmaps in Xiaomi EV's first-quarter report is equally noteworthy. R&D expenditure for the quarter hit 9 billion yuan, up 33.4% year-on-year. A significant portion of this was attributed to innovative businesses like smart EVs and AI. This brought the total number of R&D personnel to 26,048.
Image Source: @XiaomiTech
In terms of specific technological progress, Xiaomi officially unveiled its XLA cognitive large model architecture in March. The new SU7 comes equipped with this system across the lineup. This marks a shift in Xiaomi's assisted driving roadmap from "perception and imitation" to "understanding and reasoning." Subsequently, in May, Xiaomi released and fully open-sourced the autonomous driving model Xiaomi OneVL, based on the XLA architecture. This makes it the first to unify the three technical paths of VLA, World Models, and Latent Space Reasoning.
According to official disclosures, the model's minimum inference latency is just 0.24 seconds. This is only 5.4% of traditional VLA autoregressive inference. This provides the technical foundation for real-time deployment in mass-produced vehicles.
It is worth noting that investment in AI large models is not limited to the automotive sector. The financial report shows that Xiaomi's large model, Xiaomi MiMo-V2.5-Pro, ranked joint first in the comprehensive intelligence index. This was for global open-source models in Artificial Analysis evaluations. Xiaomi is driving AI empowerment across phones, vehicles, and smart homes to create a systematic technological synergy.
Regarding globalization, Xiaomi EV officially showcased the results of its European R&D center during the 2026 Beijing Auto Show. It also announced it will formally enter the international market in 2027, with Germany as the first stop. Established in Munich in March 2025, the center's core team brings together engineering and design talent from top automakers. These include BMW, Porsche, Lamborghini, and Mercedes-Benz.
In an interview during the auto show, CTO Hu Zhengnan noted that selecting Europe as the first stop was based on two considerations. First, a local team is needed to precisely understand European user needs, habits, and regulatory environments. Second, Europe possesses the world's densest pool of high-performance and luxury vehicle engineering talent. This makes it an ideal location to build a global R&D system.
During the earnings call, Lu Weibing stated: "The automotive expansion overseas is proceeding strictly according to the pace disclosed at the previous investor conference. The planned official launch is in the third or fourth quarter of 2027. The overall strategy is: developed nations first, then developing nations; mid-to-high-end first, then mid-range; right-hand drive first, then left-hand drive."
Image Source: Xiaomi EV
Judging by disclosed market performance, the YU7 GT—a model developed with deep involvement from the European R&D center—set a new lap record for SUVs at the Nürburgring Nordschleife. The time was 7 minutes and 22.755 seconds. This is viewed as the first representative work of Xiaomi EV's global technology deployment.
Conclusion
Overall, in the first quarter of 2026, Xiaomi's innovation business—comprising smart EVs and AI—achieved positive growth in both revenue and deliveries. However, facing the full-year delivery target of 550,000 units, there is significant delivery pressure for the remaining three quarters.
At the same time, the business remains in an operating loss, with short-term profitability heavily influenced by external factors. Yet, viewed over a longer timeline, the technical accumulation of the XLA cognitive model and the open-source release of Xiaomi OneVL are significant. Furthermore, the establishment of the European R&D center provides a solid technological foundation and global layout for Xiaomi EV's competition in the next stage.
