Little rice, lots of dough
本文选自 The Economist | 取经号原创翻译
Reinvigorated, the world’s fourth-largest smartphone-maker eyes a giant IPO
In China no company achieved $1bn in annual revenue as quickly as Xiaomi did, in the year following the launch of its first smartphone in 2011. Chinese media initially nicknamed Xiaomi the “Apple of the East” (its literal translation is “little rice”). That was a stretch, even in good times. But within another two years the affordable-handset-maker became the world’s most valuable startup, worth $46bn.
Analysts reckon that it now wants to raise up to $10bn in an initial public offering (IPO) on Hong Kong’s stock exchange which was announced on May 3rd. (Its filing documents disclose neither the valuation that it is seeking, nor a fundraising target.) That could afford it a very generous valuation of as much as $80bn—not far off the $91bn market capitalisation of Baidu, China’s biggest search engine and one of the country’s three “BAT” tech titans alongside Alibaba and Tencent.
Yet only 18 months ago such talk would have seemed outlandish. In 2016 Xiaomi’s sales fell sharply and it tumbled from first to fifth place among Chinese handset-makers. Lei Jun, its founder, blamed clogged supply chains at a time of rapid growth. Many thought it had overstretched, launching internet-connected gadgets, from rice cookers to drones, to create an ecosystem of devices that could be controlled from smartphones. Sales of these gizmos and Xiaomi’s low-cost but high-specification handsets accounted for 91% of its $18bn in revenues last year, yet they made only wafer-thin gross profits of 8.8%, a small fraction of the 39% that Apple makes on its iPhones.
outlandish /aʊt’lændɪʃ/ adj. conspicuously or grossly unconventional or unusual (看或听起来很)古怪的, 奇异的
wafer-thin /’weifəθin/ adj. very thin 极薄的,很薄的
Since then, Xiaomi has bounced back again. At a launch event in Shanghai in March for the MIX2S phone, Mr Lei strode on stage in gleaming white trainers in a stadium filled with Mi-Fans, as the company calls its devotees, claiming that his newest smartphone had “crushed” Apple’s iPhoneX. There was much cooing at the unveiling of the Mi Gaming Laptop, which allows users to place a food-delivery order mid-game with a programmable button.
A resurgent Xiaomi wagers that its Mi-Fans, to whom it has regularly turned online for ideas and feedback, are loyal, and that “amazing products” at “honest prices” will encourage more people to snap up its phones. It says that already 1.4m users own more than five of its hardware products. By 2022 it expects to generate $10bn in annual revenues from 1,000 physical Mi stores that sell its phones, laptops and some of its 300-odd lifestyle gadgets (mainly built by startups in which Xiaomi has stakes). Last month Mr Lei announced, to the horror of some potential investors, that he would aim to keep overall net profit margins for all of this hardware under 5%. For a long time his approach has been to make money on internet services by luring users into the Xiaomi universe with unbeatable handset prices.
The firm does indeed make its fattest gross margins, of 60%, through services and ads on Xiaomi-developed apps that are preloaded on to its home-grown MIUI operating system, a tweaked version of Android. These include Mi Music for streaming audio, for instance, and its own Mi App Store. The average revenue per user of MIUI doubled between 2015 and 2017. A banker who has helped prepare its listing sees big moneymaking potential in India, where Xiaomi overtook Samsung at the end of last year as the country’s top-selling smartphone-maker, a major reason for its bounce-back. Last year 28% of Xiaomi’s sales came from foreign markets, up from 6% in 2015. Remarkably, in the first quarter of 2018, it made over half of its sales abroad, among the first of China’s firms to do so.
Possible snags abound. Huawei, a domestic rival, grew faster than Xiaomi in India in the first three months of this year. Neil Shah of Counterpoint Research in Mumbai says that in foreign markets, where Google’s services are not blocked (unlike in China), Xiaomi will find it hard to sustain its services-based profit model. Mr Lei had been hoping to take his phones to America this year, but as troubles mount for Chinese peers such as Huawei and ZTE, it is “now unlikely to pour resources into such a tough market”, says Shelly Jing of IDC, another market-research firm. At home it will be under pressure to increase the average price—and quality—of its phones (currently 881 yuan, or $138) as veteran smartphone buyers are tempted by its rivals’ higher-end models. Excluding one-time charges, Xiaomi’s net income was a relatively modest $700m last year.
挑战在所难免。国内的竞争对手华为今年前三个月在印度的增速超越了小米。Counterpoint Research驻孟买的Neil Shah表示，在谷歌服务没有被禁止的海外市场，小米基于服务的盈利模式可能会碰壁。雷军希望今年把小米带到美国，但由于华为和中兴在美国遇到了不少麻烦，因而来自另一家市场分析公司IDC的Shelly Jing称小米“不太可能把资源倾注到这个有着重重阻力的市场”。在国内，资深手机买家被小米竞争对手的高端机型所吸引。小米面临着增加手机平均价格和提升手机品质的压力（目前的平均价格是881元，相当于138美金）。除去一次性费用，小米去年的净利润是7亿美金，表现相对平淡。
If the latest estimates are accurate, this flotation will be the biggest IPO since Alibaba fetched $21.8bn in New York in 2014. Xiaomi is eager to prove to investors that it is an internet company, and so deserves higher valuations than a simple hardware firm. It claims that more than 100m devices have been connected to its “internet-of-things” platform. Its array of investments in over 210 companies lend it the air of an incubator. Fu Sheng, who founded Cheetah Mobile, a leading maker of utility apps for smartphones, says that BAT may soon become “ATM”. M for Xiaomi would replace B for Baidu.
incubator /’ɪŋkjʊbeɪtə/ n. apparatus consisting of a box designed to maintain a constant temperature by the use of a thermostat; used for chicks or premature infants孵化器，(用于放置早产婴儿的)恒温箱