Xiaomi co-founder and chairman Lei Jun has stepped down as the company president for China, according to an internal company letter, following a drop in smartphone market share since he took the position in May.
Why it matters: Besides Lei, the company reshuffled seven other high-ranking executives within the ranks of the world’s fourth-largest smartphone maker.
- The Beijing-based company’s smartphone shipments in China declined 20% year on year in the second quarter and 33% in Q3 with market share shrinking to 9% from 12% during the six-month timeframe, according to market research firm Canalys.
- Xiaomi’s disappointing performance in the Chinese smartphone market came as rival Huawei ramped up its marketing in China over the past few months to offset weak international sales caused by a US export ban. Huawei nabbed a record 42% market share in China in the third quarter.
Details: Lei retained his roles as the company chairman and CEO while Lu Weibing, the former brand manager for the company’s budget phone spin-off brand Redmi, will replace Lei as the company president for the China region, according to an internal letter sent to Xiaomi staff on Friday, Chinese business newspaper Time Weekly reported on Sunday.
- Wang Xiang, who used to lead the company’s international business, was promoted to president of the company while former president Lin Bin was made vice chairman of the board, according to the letter signed by Lei.
- Former chief finance officer Shou Zi Chew now leads the company’s overseas business.
- Co-founder Li Wanqiang, who used to be in charge of Xiaomi’s marketing and brand strategy, resigned from the company while senior vice president Qi Yan has retired, according to the letter, which also said that they would both retain advisory roles.
- All of the changes took effect on Friday, a company spokesman told TechNode on Monday.
Context: Xiaomi last week reported 5.5% year-on-year growth in Q3 revenue, in the company’s slowest-ever growth since its July 2018 listing in Hong Kong.
- The modest earnings growth is partially due to declining smartphone sales, which dropped 8% year on year during the quarter.
- Despite the decline in the Chinese market, Xiaomi’s international business remains strong, especially in Europe, where the company’s smartphone sales surged 73% year on year in Q3.
Updated: added that Lei Jun will also remain in his role as CEO at Xiaomi.