Goldman Sachs maintains Buy on Xiaomi Corp.; robotics and EV catalysts support the 3Q re-rating thesis

Overview

This report focuses on the latest progress of Xiaomi Corp. in robotics and embodied intelligence, and evaluates it within Xiaomi's "Human x Car x Home" ecosystem, EV business, and AI monetization path. Goldman Sachs maintains a Buy rating, believing Xiaomi is still in the early stage of a multi-year ecosystem expansion, and that its robotics capability is moving from a point-hardware showcase toward a systematic stage where hardware embodiment, data generation, and foundation models mutually reinforce one another.

Core views

The core views are: first, Xiaomi Robotics has completed early framework integration, enabling real deployment failure samples to be fed back to the scenario generation model, then using synthetic boundary scenarios to train the foundation model and redeploying it to physical hardware, forming a self-reinforcing loop. Second, near-term commercialization is more likely to concentrate in structured B-end scenarios, such as large-scale humanoid robot deployment in Xiaomi's own smart EV, smartphone, and home appliance factories, as well as partner factories. Third, EV- and AI-related catalysts will continue to build in 3Q26, with the SkyNomad launch in particular potentially improving visibility for 2027E sales. Fourth, the current valuation has partly reflected improved EV sentiment, but still does not capture the value of AI, robotics, and other new businesses.

Analysis framework

The report combines company event updates, technology milestone comparisons, production-line deployment progress, foundation model benchmark performance, ecosystem scenario advantages, and SOTP valuation. Goldman Sachs compares Xiaomi with global robotics and embodied intelligence participants such as Figure AI, Tesla Optimus, Physical Intelligence, and Gemini Robotics, while also using EV peer P/S, core business P/E, and DCF valuation to assess segment value.

Methodology notes

• Valuation methodsSOTP valuation

  sum-of-the-parts valuation

  The 12-month target price of HK$40 is based on the SOTP method: Xiaomi's core business uses a target 12-month forward EV/NOPAT of 16x, Xiaomi EV uses a DCF valuation of US$42bn, and a 10% holding company discount is applied.

• Valuation methodsDCF

  discounted cash flow

  Xiaomi EV valuation uses the DCF method, with key assumptions including a 12% WACC and a 3% terminal growth rate.

• factorGS Factor Profile

  growth, financial returns, valuation multiples, and composite percentile

  Goldman Sachs Factor Profile compares individual stocks with globally covered equities and industry peers through growth, financial returns, valuation multiples, and composite indicators.

• riskM&A Rank

  M&A probability score

  Goldman Sachs scores M&A Rank from 1 to 3, where 1 represents a high probability of M&A and 3 represents a low probability; this report lists Xiaomi's M&A Rank as 3, which is typically not included in the target price.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Xiaomi Corp. (1810.HK)

  Core coverage target

  Strengths

  The world's third-largest smartphone brand, with consumer AIoT and NEV platforms, strong self-owned manufacturing scenarios, supply-chain scale, ecosystem integration capability, and balance sheet.

  Weaknesses

  Actual robotics execution speed and scale still lag some global leaders, and disclosure on certain model architectures, cost structures, and performance parameters is insufficient.

  Comparison

  The report compares Xiaomi Robotics with Figure AI's deployment on BMW production lines, Physical Intelligence Pi-0.7, Figure Helix 02, Tesla Optimus, and Gemini Robotics 1.5, among other closed-source or leading models.

  Risks

  Intensifying smartphone competition, margin pressure, weaker-than-expected premiumization and EV execution, geopolitical and regulatory uncertainty, macro weakness, and FX volatility.

• Xiaomi smart EV business

  Important source of valuation and catalysts

  Strengths

  Goldman Sachs expects Xiaomi EV's 2026E/2027E revenue YoY growth to exceed 30%, faster than the mid-teen average of domestic peers, and the SkyNomad launch may improve visibility for 2027E sales.

  Weaknesses

  The current EV valuation multiple has risen from 0.75x 2026E P/S at end-June to 1.3x, partly reflecting improved sentiment.

  Comparison

  Domestic peers include BYD, Li Auto, XPeng, and NIO, with an average P/S of about 0.8x.

  Risks

  Intensifying EV competition, gross margin pressure, and weaker-than-expected model launches and sales execution.

• Xiaomi Robotics and embodied AI

  Mid- to long-term new-business optionality

  Strengths

  It has formed an early closed loop of hardware embodiment, synthetic data, and foundation models, showing progress in factory task success rates, WorldArena, RoboCasa, and RoboDojo.

  Weaknesses

  There is still uncertainty around speed, production-line throughput, advanced closed-source model capability, and detailed cost parameters.

  Comparison

  Compared with global leading solutions such as Figure AI, Physical Intelligence, Tesla Optimus, and Gemini Robotics, Xiaomi has scenario and ecosystem advantages, but its technological maturity still needs validation.

  Risks

  Commercialization pace slower than expected, insufficient model generalization, excessively high real deployment costs, and synthetic data failing to adequately cover boundary scenarios.

Key data

• RatingBuyRating has been in place since October 19, 2023.
• 12-month target priceHK$40Based on the SOTP valuation method.
• Reference current priceHK$27.50Price shown in the report disclosure section.
• Market capitalizationHK$708.8bn / US$90.4bnDisclosed in Key Data.
• Enterprise valueHK$510.2bn / US$65.1bnDisclosed in Key Data.
• 3-month average daily trading valueHK$4.7bn / US$596.8mnDisclosed in Key Data.
• 2026E revenueRmb479,154.1mnGoldman Sachs forecast.
• 2027E revenueRmb566,666.6mnGoldman Sachs forecast.
• 2026E EPSRmb1.02Goldman Sachs forecast.
• 2027E EPSRmb1.36Goldman Sachs forecast.
• 2026E P/E23.2xGoldman Sachs forecast.
• 2027E P/E17.4xGoldman Sachs forecast.
• Robot production-line task success rate98%July success rate for the self-tapping nut loading workstation, versus 90%+ at initial deployment in March.
• New logistics task success rate90%Tasks such as flexible central-control side-cover sorting and turnover box folding.
• Xiaomi-Robotics-UO parameter scale38BUnified generative model for embodied scenario and trajectory synthesis.
• Xiaomi-Robotics-1 training data100k hours of real trajectories + 10k hours of cross-embodiment post-trainingUsed for VLA foundation model pretraining and cross-embodiment adaptation.

Impact & implications

The investment implication is that Xiaomi's market narrative is shifting from being primarily smartphone-led to EV, AI, and new businesses. If the robotics framework can continue improving task success rate, speed, and scale in factory scenarios, and extend through the AIoT ecosystem into home automation, Xiaomi may build a consumer-facing physical intelligence ecosystem. On valuation, the report believes the current market cap has reflected some EV improvement, but still assigns no value to AI, robotics, and other new businesses, leaving room for a dual narrative and financial re-rating opportunity in 3Q26.

Risks

• Competition in the global smartphone industry becomes more intense, and market share gains are weaker than expected.
• Margin pressure in smartphones and EV businesses is higher than expected.
• Xiaomi's premiumization and EV business execution fall short of expectations.
• Geopolitical risks and regulatory uncertainty intensify.
• A weakening macro environment leads to soft smartphone and IoT demand.
• FX volatility affects earnings and valuation.
• Actual robotics execution speed, scaled deployment, and cost structure fail to meet market expectations.
• The commercialization timeline for new AI and robotics businesses is uncertain.

What to watch

• Whether EV- and AI-related catalysts materialize in 3Q26.
• Changes in market visibility on Xiaomi EV sales for 2027E after the SkyNomad launch.
• Improvements in deployment scale, speed, and task complexity of Xiaomi humanoid robots in its own factories and partner factories.
• Whether Xiaomi-Robotics-UO's synthetic data capability continues to improve real deployment boundary scenarios.
• Performance of Xiaomi-Robotics-1 across more cross-embodiment, cross-scenario benchmarks and real tasks.
• Whether the market begins assigning valuation to AI, robotics, and other new businesses.
• Gross margin trends in smartphones, EV, and AIoT businesses.