Big round of layoffs at Xiaomi
Tech manufacturer (and giant) Xiaomi is cutting thousands of jobs in a major round of layoffs. The Chinese company is very much affected by sharply declining smartphone sales in China and the corona crisis. Read more about this news here.
Major contraction
This news comes from Hong Kong's South China Morning Post newspaper. Social media in China has been "flooded" with reports of Xiaomi employees who have sadly lost their jobs, according to the newspaper. In this, most of the layoffs occurred in industries focused on smartphones and other online services. Xiaomi, one of the largest companies in the smartphone world and other gadgets, still had over 35,000 employees as of September 2022, including 32,000 of them in China. A spokesperson for the company told the Hong Kong newspaper that the company has implemented a "routine staff optimisation and organisational streamlining" that affects only "less than 10% of staff". In China, rounds of layoffs are often carried out under the guise of "business optimisation" in order to evade scrutiny from regulators. However, a Chinese media outlet, Jemian, reports that the company's workforce will shrink by as much as at least 15%.
Reduced demand for smartphones in China
Xiaomi has suffered greatly from slumped demand for smartphones this year, partly due to strict corona measures in China. As a result, the company's sales and profits fell sharply in recent quarters. For instance, last quarter's sales were down almost 10% compared to the same period last year. Smartphone sales, which account for about 60% of Xiaomi's total sales, were down 11% year-on-year. This news comes a week after the unveiling of the new Xiaomi 13 series. Globally, Xiaomi is currently number three in the smartphone market, behind Samsung and Apple. Its goal was to become number one by 2024. With the growth of other Chinese competition such as Honor and Vivo, Xiaomi lost quite a bit of its market share. Moreover, like other Chinese companies, Xiaomi is suffering from a recent measure by India, which has Chinese manufacturers banned from selling devices cheaper than $150 in the country.
Not the only tech giant with rounds of layoffs
Xiaomi is not the only major tech company to make hefty rounds of layoffs. Amazon, for instance, reportedly had the largest round of layoffs in the company's history with 10,000 people losing their jobs. Meta, the parent company of Facebook and WhatsApp, among others, recently laid off 11,000 employee and Elon Musk also recently fired half of the Twitter staff.
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