Connect with us

Finance

China’s Xiaomi is selling so many electric cars it’s closer to breaking even

Published

on

The Xiaomi SU7 on display at the Mobile World Congress 2024.

Arjun Kharpal | CNBC

BEIJING — Chinese smartphone company Xiaomi‘s new electric vehicle is selling better than expected, putting it closer to break-even despite undercutting Tesla‘s Model 3 on price.

Xiaomi has received more than 70,000 orders for its electric SU7 sedan as of April 20, close to the company’s original full-year target for deliveries this year, CEO Lei Jun told investors Tuesday.

The company now aims to deliver 100,000 of its new EV this year, he said.

Xiaomi released the SU7 in late March with a price about $4,000 less than Tesla’s Model 3, and has started deliveries. The Chinese smartphone company is set to livestream a car update at 9:20 a.m. on Thursday, as the Beijing auto show kicks off.

“Breakeven would be realized if annual sales reach 300[k]-400k,” Citi analysts said in a report, citing the investor day. They raised their autos segment gross profit margin forecast to 6% this year, versus a 10% loss previously expected.

Why it's so hard to start an EV company

The Citi analysts raised their earnings per share forecast by 25% this year, and now expect Xiaomi to ship 100,000 cars this year, 200,000 next year and 280,000 in 2026.

For context, Tesla China sold more than 600,000 cars last year, according to the China Passenger Car Association. Li Auto, which technically sells mostly hybrids, sold 376,000 cars last year, while Nio sold just over 160,000 cars last year, the data showed.

Li Auto had a gross margin of 23.5% in the fourth quarter last year, while Nio’s gross margin was 7.5%, both up from the year-ago period.

Tesla’s gross margin has successively declined over the past five quarters to 17.4% in the first three months of this year. Gross margin figures don’t account for operating expenses.

When Xiaomi launched the SU7 last month, Lei said the company would be selling each car at a loss.

But on Tuesday, he estimated gross profit margin of around 5% to 10% for Xiaomi’s auto business, and noted that sales are greater than expected, while expressing thanks to suppliers on reducing costs.

“We are currently in discussions with supply chain partners on how to increase production capacity and further support on costs,” he said, according to a CNBC translation of a Chinese-language investor day transcript provided by the company.

Sticking to China for now

Continue Reading

Finance

Treasury Secretary Bessent says market woes are more about tech stock sell-off than Trump’s tariffs

Published

on

Treasury Secretary Scott Bessent speaks to reporters outside the West Wing after doing a television interview on the North Lawn of the White House on March 13, 2025 in Washington, DC. 

Andrew Harnik | Getty Images

Treasury Secretary Scott Bessent said Wednesday the sell-off in the stock market is due more to a sharp pullback in the biggest technology stocks instead of the protectionist policies coming from the Trump administration.

“I’m trying to be Secretary of Treasury, not a market commentator. What I would point out is that especially the Nasdaq peaked on DeepSeek day so that’s a Mag 7 problem, not a MAGA problem,” Bessent said on Bloomberg TV Wednesday evening.

Bessent was referring to Chinese AI startup DeepSeek, whose new language models sparked a rout in U.S. technology stocks in late January. The emergence of DeepSeek’s highly competitive and potentially much cheaper models stoked doubts about the billions that the big U.S. tech companies are spending on AI.

The so-called Magnificent 7 stocks — Apple, Amazon, Tesla, Alphabet, Microsoft, Meta and Nvidia — started selling off drastically, pulling the tech-heavy Nasdaq Composite into correction territory. The tech-heavy benchmark is down about 13% from its record high reached on December 16.

However, the secretary downplayed the impact from President Donald Trump’s steep tariffs, which caught many investors off guard and fueled fears of a re-acceleration in inflation, slower economic growth and even a recession. Many investors have blamed the tariff rollout for driving the S&P 500 briefly into correction territory from its record reached in late February. Wall Street defines a correction as a drop of 10% from a recent high.

Stock Chart IconStock chart icon

hide content

S&P 500, YTD

Trump signed an aggressive “reciprocal tariff” policy at the White House Wednesday evening, slapping duties of at least 10% and even higher for some countries. The actions sparked a huge sell-off in the stock market overnight, with the S&P 500 futures declining nearly 4% and the blue-chip Dow Jones Industrial Average shedding 1,100 points. The losses will likely but the S&P 500 back into correction territory in Thursday’s session.

“It’s going to be fine if we put the best economic conditions in place,” Bessent said in a separate interview on Fox Wednesday evening. “If you go back and look, the stock market actually peaked on the [DeepSeek] Chinese AI announcement. So a lot of what we have seen has been just an idiosyncratic tech sell-off.”

Continue Reading

Finance

Conservative cable channel Newsmax shares plunge more than 70% after a dizzying 2-day surge

Published

on

A Newsmax booth broadcasts as attendees try out the guns on display at the National Rifle Association (NRA) annual convention in Houston, Texas, U.S. May 29, 2022. 

Callaghan O’hare | Reuters

Shares of conservative news channel Newsmax plunged more than 70% on Wednesday as its meteoric rise as a new public company proved to be short-lived.

The stock tumbled a whopping 72% in afternoon trading, following a 2,230% surge in Newsmax’s first two days of trading after debuting on the New York Stock Exchange. At one point, the rally gave the company a market capitalization of nearly $30 billion — surpassing the market cap of legacy media companies like Warner Bros. Discovery and Fox Corp.

Newsmax was listed on the NYSE via a so-called Regulation A offering, instead of a traditional IPO. Such an offering allows small companies to raise capital without undergoing the full SEC registration process. The primary focus is to sell to retail investors, in this case It was sold to approximately 30,000 retail investors. 

The public offering indeed garnered the attention from retail traders, some of whom touted the stock as the “New GME” in online chatrooms. GME refers to the meme stock GameStop, which made Wall Street history in 2021 by its speculative trading boom.

Newsmax has a small “float,” or shares available for trading. Less than 6% of Newsmax shares, or 7.5 million shares out of a total of 128 million fully diluted shares, are available for public trading.

The conservative TV news outlet has seen its ratings rise with the election of President Donald Trump and other prominent Republicans — although it still falls behind the dominant Fox News. Overall, Newsmax ranks in the top 20 among cable network average viewership in both prime time and daytime, Nielsen said.

Continue Reading

Finance

Stocks making the biggest moves midday: TSLA, DJT, AMZN, RIVN

Published

on

Continue Reading

Trending