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Strong EV demand drives Xiaomi revenues up 30.5% in third quarter

Ana Mary Joseph
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Strong EV demand drives Xiaomi revenues up 30.5% in third quarter
  • Company plans to introduce a premium variant, the SU7 Ultra, priced at over $110,000 while the SU7 is priced at less than $30,000.
  • Xiaomi maintained its status as the world’s third-largest manufacturer, achieving a 3% increase in shipments, thereby capturing 14% of the global market.

Xiaomi Corp, the Chinese electronics powerhouse, has recently made waves in the automotive industry, reporting a significant 30.5 per cent increase in third-quarter revenue driven by consumer interest in its newly launched electric vehicle, the SU7 sedan.

Launched in March, this vehicle is conspicuously positioned in the highly competitive Chinese electric vehicle (EV) market, featuring design elements reminiscent of luxury brands such as Porsche and priced attractively under $30,000 for the base model.

This pricing strategy not only undercuts Tesla′s Model 3 in China by approximately $4,000 but also positions Xiaomi favourably as it seeks to expand its foothold in this burgeoning sector.

Doubling production

In light of the burgeoning demand for the SU7, Xiaomi has ambitiously raised its sales target for the year to 130,000 vehicles, significantly exceeding its original goal of 76,000.

To meet this heightened demand, the company has undertaken measures including doubling production shifts since June and introducing a premium variant, the SU7 Ultra, priced at over $110,000.

Competitive landscape

Despite these growth indicators, Xiaomi’s automotive division continues to face challenges, operating at a loss with an adjusted deficit of 1.5 billion yuan for the quarter and a gross profit margin of 17.1 per cent.

Quarterly results reveal that Xiaomi’s total revenue for the period ending September 30 reached 92.5 billion yuan ($12.77 billion), surpassing the consensus estimate from analysts.

Furthermore, the company’s adjusted net profit experienced a modest 4.4 per cent rise to 6.25 billion yuan, exceeding forecasts and underscoring its overall resilience in a competitive landscape.

Notably, in the smartphone segment, Xiaomi maintained its status as the world’s third-largest manufacturer, achieving a 3 per cent increase in shipments, thereby capturing 14 per cent of the global market.

According to projections from Huatai Securities, Xiaomi anticipates delivering 400,000 electric vehicles by 2025, anticipating that electric cars will contribute significantly to revenue, growing from 8 per cent this year to approximately 20 per cent.

The strategy emphasises Xiaomi’s commitment to diversifying its product offerings and consolidating its presence in the automotive sector.

As the company navigates the complexities of entering a saturated market, its continued innovation and adaptability will be crucial in determining its future success in the electric vehicle landscape.

Huawei takes pre-orders for its Mate 70 smartphone models

Naushad K. Cherrayil
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Huawei takes pre-orders for its Mate 70 smartphone models
  • The device’s side profile indicates a thicker camera bump compared to its predecessor, the Mate 60, suggesting an evolution in hardware capabilities.
  • Leaks showcase the smartphone’s rear design, characterised by a distinctive circular camera bump encased in a diamond-cut textured ring.
  • The design features four camera openings, with three likely serving as the main camera, ultra-wide, and telephoto lenses, while the fourth may function as a depth sensor to enhance portrait photography.

Huawei Technologies, on Monday, announced the commencement of pre-orders for its highly anticipated Mate 70 smartphone series, as detailed in a statement on its official WeChat account.

The announcement marks a significant moment for the company, which plans to hold a dedicated event on November 26 at 2:30PM China time to unveil its complete Mate lineup.

Notably, the online store has begun accepting reservations for the Mate 70 and its two Pro variants without requiring a deposit, although specific pricing details remain undisclosed.

Huawei’s re-entry into the 5G premium smartphone market with the Mate 60 series last year, which featured domestically produced semiconductors, has been lauded in China as a strategic victory over US sanctions that have hindered the company’s access to advanced American technology since 2019.

Four distinct models

The backdrop adds a layer of significance to the Mate 70 series, as it represents not only technological advancement but also resilience in the face of external challenges.

The promotional materials released by Huawei include an image showcasing the smartphone’s rear design, characterised by a distinctive circular camera bump encased in a diamond-cut textured ring.

The design features four camera openings, with three likely serving as the main camera, ultra-wide, and telephoto lenses, while the fourth may function as a depth sensor to enhance portrait photography. The device’s side profile indicates a thicker camera bump compared to its predecessor, the Mate 60, suggesting an evolution in hardware capabilities.

Huawei’s Mate 70 series will comprise four distinct models: standard, Pro, Pro+, and Ultimate Design. Each model will offer varying specifications, with the Ultimate Design version boasting exclusive rear finishes and a premium aesthetic at a higher price point.

Fresh design direction

The innovative back texture displayed in promotional images hints at a fresh design direction, while the standard models are expected to include both textured and plain back panels.

Furthermore, the Mate 70 series will debut with a new generation of HarmonyOS, featuring redesigned animations and enhanced functionalities.

The integration of artificial intelligence and large language models within the Kirin chipset promises to elevate the user experience, aligning with contemporary technological trends.

The Mate 70 and Mate 70 Pro will be available in an array of colours, including Black, White, Green, and Purple, with configurations offering up to 12 GB of RAM and storage options ranging from 256 GB to 1 TB.

The Mate 70 Pro+, on the other hand, will present a more exclusive colour palette and enhanced specifications, including 16 GB of RAM.

Nvidia’s evolution into an AI powerhouse triumphs over Intel

Naushad K. Cherrayil
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Nvidia’s evolution into an AI powerhouse triumphs over Intel
  • Patent data and innovation metrics reveal how Nvidia has strategically positioned itself at the forefront of AI acceleration, while Intel has sought to maintain its dominance in traditional CPU architecture.
  • New challengers, including Google’s custom-designed Tensor processors and innovative startups like Samba Nova, are emerging, intensifying the race for more efficient and specialised AI acceleration solutions.
  • Both Nvidia and Intel are reportedly making strides in quantum computing applications for AI, indicating a future of continued innovation.

The recent transition of Nvidia into the Dow Jones Industrial Average, a position long held by Intel, marks a significant milestone in the semiconductor industry.

For over two decades, Intel was a foundational pillar of this prestigious index, having joined in 1999 alongside other tech titans such as Microsoft.

However, the rise of artificial intelligence (AI), particularly through generative AI and large language models (LLMs), has catalysed a profound disruption, allowing Nvidia to surpass Intel in prominence, as reported by GlobalData.

Both companies have endeavoured to adapt their strategies in response to the rapidly changing technological landscape. Yet, Nvidia’s ability to pivot effectively has distinguished it from its rival.

Originally focused on gaming graphics and augmented reality/virtual reality (AR/VR) drivers, Nvidia’s evolution into an AI powerhouse is particularly remarkable.

2016: A pivotal moment

The launch of its first AI-centric GPU architecture in 2016 marked a pivotal moment, enabling the company to transition from compute-intensive applications such as computer vision and autonomous driving to the burgeoning field of LLMs.

Sourabh Nyalkalkar, Practice Head of Innovation Products at GlobalData, said that the “changing of the guard” is not merely symbolic.

“Patent data and innovation metrics reveal how Nvidia has strategically positioned itself at the forefront of AI acceleration, while Intel has sought to maintain its dominance in traditional CPU architecture.

“Nvidia’s rapid adaptation to the demands of LLM training and inference has allowed it to secure a leading role in the AI chip market, leaving traditional semiconductor leaders scrambling to keep pace.”

Market confidence

Market confidence in Nvidia’s AI strategy became evident in 2020, as its stock performance began to eclipse that of Intel. The trend has only intensified, with Nvidia’s market returns now eight times greater than Intel’s.

Furthermore, Nvidia’s generative AI patent portfolio surpasses that of Intel by 40 per cent, underscoring its innovative edge.

Nyalkalkar attributes Nvidia’s success to its strategic focus on specific applications for LLMs, leading to the development of targeted solutions for various use cases, including AI-driven coding assistance and image generation.

Additionally, Nvidia has established itself as a leader in critical technological innovations, such as variational autoencoders (VAEs) and specialised neural net accelerators, which are essential for powering contemporary AI systems.

Despite Nvidia’s current dominance in the AI chip market, the semiconductor landscape remains dynamic and fiercely competitive. New challengers, including Google’s custom-designed Tensor processors and innovative startups like Samba Nova, are emerging, intensifying the race for more efficient and specialised AI acceleration solutions.

Looking ahead, Nyalkalkar said that technologies like Quantum AI could further revolutionise the generative AI landscape. Both Nvidia and Intel are reportedly making strides in quantum computing applications for AI, indicating a future of continued innovation.

LIC to foray into health insurance by buying stake in standalone unit

Mohammed Fahad
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LIC to foray into health insurance by buying stake in standalone unit
  • GlobalData says market is projected to grow at an annual growth rate of 12.5%, increasing from $15.6b in 2024 to $25.3b by 2028.
  • Corporation’s strong brand recognition and its vast sales force, comprising over 1.3m agents, are likely to facilitate the transition.

The Life Insurance Corporation of India (LIC) is poised to make a significant entry into the health insurance market in 2025 by acquiring a stake in a standalone health insurance entity.

The strategic move is anticipated to enhance LIC’s market share, reinforcing its position as the largest insurer in the country.

According to a report by GlobalData, India’s health insurance industry is projected to grow at a compound annual growth rate (CAGR) of 12.5 per cent, increasing from Rs1.3 trillion ($15.6 billion) in 2024 to Rs2.1 trillion ($25.3 billion) by 2028.

The growth is primarily driven by rising healthcare costs and an increasing public awareness of the necessity for comprehensive health coverage.

Manogna Vangari, Insurance Analyst at GlobalData, said that by leveraging its extensive existing customer base, LIC’s foray into health insurance could significantly bolster its market presence.

Strong growth

Health insurance represents the most rapidly expanding segment of India’s insurance landscape, with premiums on the rise due to the growing demand for private healthcare services.

Vangari said the upward trend is expected to continue, further accelerating the growth of the health insurance sector.

LIC’s strategy of acquiring a stake in a private health insurance firm aligns with its goal of maintaining a “strategic presence” in the market while minimising the risks associated with majority ownership.

Strong brand recognition

“The approach not only allows LIC to establish itself in the burgeoning health insurance industry but also positions it to contribute to the government’s objective of achieving universal health coverage by 2047. The corporation’s strong brand recognition and its vast sales force, comprising over 1.3 million agents, are likely to facilitate this transition,” Vangari said.

Currently, the Indian health insurance market is served by several standalone companies, including Star Health & Allied Insurance and Niva Bupa Health Insurance, among others. LIC’s entry is expected to intensify competition within this sector.

Vangari emphasises that LIC holds a competitive advantage over its private-sector counterparts, particularly due to its superior Claim Settlement Ratio (CSR), a crucial indicator of an insurer’s reliability. A higher CSR reflects the company’s commitment to promptly settling claims, thereby enhancing customer trust.

HCLTech teams up with ServiceNow to roll out AI labs

TCN Bureau
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HCLTech teams up with ServiceNow to roll out AI labs
  • The experiences cultivated in this Noida lab will also be mirrored at the existing HCLTech AI & Cloud Native Lab in London.

India’s HCLTech, in collaboration with American software firm ServiceNow, inaugurated a dedicated artificial intelligence (AI) lab at its Noida campus.

The initiative marks a significant advancement in their longstanding partnership, which has spanned over a decade, and signifies their joint commitment to facilitating AI adoption across various industries.

The newly established facility offers customers a unique opportunity to engage with innovative solutions tailored to their specific industry challenges. It is designed to act as a testing ground, allowing clients to navigate and expand upon AI technologies that are increasingly pivotal in contemporary business environments.

As noted by Jagadeshwar Gattu, President of Digital Foundation Services at HCLTech, the lab represents a simulated environment where clients can explore and implement AI-based solutions, thus enhancing their overall operational efficiency.

Driving profitability

Furthermore, the experiences cultivated in this Noida lab will also be mirrored at the existing HCLTech AI & Cloud Native Lab in London.

The expansion is expected to facilitate the acceleration of AI adoption among a broader client base in both the UK and India.

Michael Park, Senior Vice President and Global Head of AI Go-to-Market at ServiceNow, highlighted that the collaborative efforts between HCLTech and ServiceNow aim to empower clients, enabling them to take control of their AI investments and ultimately drive productivity and profitability within their enterprises.

US to award $6.6b government subsidy to TSMC subsidiary

Ana Mary Joseph
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US to award $6.6b government subsidy to TSMC subsidiary
  • Chips and Science Act allocated $39b in grants, alongside $75b in loans and 25% tax credits, as part of a concerted effort to counteract the trend of production outsourcing to Asia.
  • Advancement of Chips Act promises not only to revitalise the US semiconductor industry but also to fortify its position in global technology landscape.

The finalisation of the Biden administration’s incentive awards under the Chips Act for the US unit of Taiwan Semiconductor Manufacturing Co. (TSMC) marks a significant achievement in the strategic efforts to rejuvenate domestic semiconductor production.

The Department of Commerce announced that TSMC will receive $6.6 billion in grants, a sum previously disclosed in preliminary agreements but now formalized to create a legally binding contract. The arrangement underscores a critical step in a broader initiative to reintegrate essential semiconductor manufacturing capabilities back onto American soil.

As the largest foreign direct investment project in US history, TSMC’s endeavour to construct a complex of three factories near Phoenix will necessitate a substantial investment exceeding $65 billion.

The funding is not merely financial; it represents a strategic shift towards enhancing America′s technological autonomy.

National security

By achieving initial benchmarks, TSMC stands to receive at least $1 billion this year, illustrating the company’s commitment to accelerating production timelines and fostering innovation within the crucial semiconductor sector.

Commerce Secretary Gina Raimondo said the monumental significance of this development, highlighting that the technology involved is among the most coveted globally.

“The implications extend beyond mere economic growth; securing semiconductor manufacturing domestically is pivotal for national security in an era increasingly characterised by technological competition and geopolitical tension.”

The Chips and Science Act allocated $39 billion in grants, alongside $75 billion in loans and 25 per cent tax credits, as part of a concerted effort to counteract the trend of production outsourcing to Asia.

Further awards soon

With further awards anticipated in the coming weeks, the Chips Act stands as one of the most consequential industrial policies in decades, reflecting a collective commitment across party lines to bolster US manufacturing capabilities.

However, there remains pressure to expedite funding disbursements as various states, including Ohio, New Mexico, Oregon, and New York, await allocations for their semiconductor projects. Intel Corp has expressed particular urgency, grappling with complexities in finalising its contracts amid evolving business challenges.

As the new administration approaches, the urgency of securing these agreements becomes more pronounced. While concerns over the potential for renegotiation linger, the Chips Act’s bipartisan foundation and the commitment to economic and national security mitigate fears of substantial changes.

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