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UBS Chops XIAOMI-W (01810.HK) TP to $46 as Higher Memory Costs Pressure on Smartphone GPM
2025-11-19 11:52:22
XIAOMI-W (01810.HK)'s 3Q25 revenue was RMB11.3 billion, up 22.3% YoY and down 2.4% QoQ, in line with the expectations of UBS/ market consensus, according to UBS' research report.

UBS lowered its 2026/ 2027 EPS forecasts for XIAOMI-W by 13%/ 5% each, mainly reflecting the pressure on smartphone gross profit margins from higher memory costs and a conservative shipment outlook following an increase in average selling prices.

The broker also reduced its EV gross profit margin forecasts from 24.6%/ 23.5% to 22.6%/ 23.5% to account for additional costs from subsidizing purchase tax.

Therefore, UBS chopped its target price for XIAOMI-W from $53.5 to $46 based on a SOTP valuation method, with a 20.6x core business earnings or 2026 and a 2x EV sales in 2026, equivalent to a 20.9x PE ratio for 2026.
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