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Xiaomi vs Counterpoint: Company says shipped 1 mn smartphones in Q3, denies sales drop

Xiaomi claims 45 per cent Q-on-Q growth, research firm says Q2 was better than Q3.

Written by Debashis Sarkar | New Delhi | Updated: November 8, 2015 4:44:32 pm
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Xiaomi India has claimed that it sold more than 1 million devices in Q3 2015 and that this was its best quarter to date in the country in sharp contrast to a recent report by Counterpoint Research India recently, which had said that the much talked about Xiaomi had seen their first decline in India.

According to Counterpoint’s research, Xiaomi’s shipments fell by a huge 46 per cent in Q3 2015 due to stiff competition from Lenovo and Micromax’s Yu.

The startup’s India head Manu Jain was quick to respond to this on Twitter- “Mi fans: we had our best ever quarterly sales. We sold 1+ Mn units in Q3, with 45% Q-o-Q growth in 2015!

Note that while Counterpoint reports shipments, Jain talks about sales. Most market trackers consider shipments to rank a particular brand. However, the real story is in the number of units sold.

But when Xiaomi says they had their best quarter in terms of sales how can Counterpoint’s report be poles apart?

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Jain attributes this to the fact that one of their most sold smartphone in recent times- Redmi 2 Prime- is now made in India. “The Counterpoint report grossly underestimates our numbers. If the report considers shipment figures only then it has to be noted that in August, we have started domestic manufacturing. If we are not shipping every smartphone from China and manufacturing locally, obviously our shipment numbers will be less,” said Jain.

Rejecting this claim, Tarun Pathak, Sr Analyst, Mobile Devices and Ecosystems, Counterpoint Research said, “Firstly, we stand by our numbers. Contrary to the arguments, I would like to say that we have definitely included the domestic manufacturing of Redmi 2 Prime smartphone figures. The numbers that we have shared includes both imports and domestic manufacturing.”

Talking about sales figures, Xiaomi’s Jain adds, “We had the best ever quarter in Q3 (July- September) 2015. In this quarter we sold over one million units. This was a major milestone for us. This is the first time we crossed a million mark in a quarter. If we consider just 2015 calendar year, we saw an average Q-o-Q growth of 45 per cent.”

In reply to this, Pathak said, “If Xiaomi says that they have achieved a Q-o-Q growth of 45 per cent and have sold a million unit in Q3, by this logic, it means that they have sold around 690,000 units in Q2. However, what we observed was Xiaomi’s Q2 was better than Q3.”

Pathak observes that if Q3 2015 is Xiaomi’s best quarter, how can its Q2 2015 shipment figures be better. “In Q2 2015, the Redmi 2 smartphone performed well,” added Pathak.

“What we observed is that fierce competition from Lenovo and Micromax’s Yu brands, especially in the higher volume sub-$100 segment have affected Xiaomi’s growth story,” said Pathak.

Pathak said, “What is more surprising is that Xiaomi has not come up with any new smartphone to cash in on Diwali sales in the country. Going by trends, Diwali is the time where smartphone sales are the highest. When most brands including top players like Samsung and Micromax have launched their smartphones to attract Diwali sales, Xiaomi on the other hand, despite being so popular, is silent.”

However, Xiaomi recently announced its ‘Diwali with Mi’ promotional campaign. Jain claimed it was a huge hit among buyers and also a milestone for its e-commerce website mi.com/in. “On the first day of the campaign, we got a million unique visitor on our website. We achieved this without any marketing at all,” said Jain.

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