All posts in “Smartphones”

Xiaom Q4 sees strong growth in overseas shipment and internet services

Xiaomi, the Chinese company known for its cheap handsets and a vision to drive revenues by selling internet services, has come in ahead of analysts’ estimates in its fourth-quarter profit although revenues missed expectations.

The Hong Kong-listed company more than tripled its net profit to 1.85 billion yuan ($276 million), exceeding the 1.7 billion yuan average estimate, Reuters reported citing Refinitiv data. However, revenue from the quarter missed the 47.4 billion yuan expectation, rising 26.5 percent to 44.4 billion yuan ($6.62 billion).

Xiaomi singled out overseas markets in its latest earnings report as the segment grew 118.1 percent to make up 40 percent of its total revenue in the fourth quarter, compared with just 28 percent for the year-earlier period. Xiaomi has been particularly well-received in India, where it holds a leading position in smartphone shipments according to market researcher Canalys, and it’s seeing rapid growth in western Europe.

Unlike conventional smartphone makers that are fixated on selling hardware, Xiaomi runs what it calls a “triathlon” business model comprising of hardware, software and retail. To put it in layman’s terms, the company is selling hardware through its network of online and offline stores, upon which users will consume the app services and in-app ads that come with its smartphones, smartwatches, smart air purifiers and hundreds of other connected devices.

Xiaomi has repeatedly billed itself as an “internet” firm, though so far smartphones are still its main economic driver, accounting for 65.1 percent of overall revenue in Q4. Despite a sluggish year for smartphone brands around the world, Xiaomi handsets grew nearly 30 percent to 118.7 million units in sales last year. The company predicted back in October that it was on course to hit the 100 million sales mark that month.

25.1 percent of Xiaomi’s Q4 revenue went to smart devices (excluding phones) and lifestyle items, representing an 87 percent year-over-year growth. The latter category, which ranges from umbrellas and suitcases to clothes and shoes, is pivotal to Xiaomi’s goal to attract more female users, an effort that has seen the company team up with selfie app maker Meitu. 

Internet services remain as Xiaomi’s smallest segment, bringing in only 9.1 percent of total revenue and growing at 61 percent year-over-year. But the highly lucrative business is bound to carry more load in the future as Xiaomi has promised to keep profit margins for smartphones and hardware under 5 percent.

Gross profit margin from Xiaomi’s internet services increased to 64.4 percent in 2018, up from 60.2 percent in 2017 driven by a higher-margin advertising business. The number is well above the 6.2 percent profit margin for Xiaomi smartphones, and the firm can potentially generate more internet-based income if it’s able to step up monetization of the 242.1 million monthly users on its ecosystems apps.

Xiaomi outs Redmi Go, a $65 entry-level smartphone for India

Chinese smartphone maker Xiaomi has announced a new entry level smartphone at an event in Delhi.

The entry-level smartphone is targeted at the Indian market and looks intended to woo feature phone owners to upgrade from a more basic mobile.

It runs Google’s flavor of Android optimized for low-powered smartphones (Android Go) which supports lightweight versions of apps.

Under the hood the dual-SIM handset has a Qualcomm Snapdragon 425 chipset, 1GB RAM and 8GB of storage (though there’s a slot for expanding storage capacity up to 128GB).

Also on board: 4G cellular connectivity and a 3000mAh battery.

Up front there’s a 5 inch HD display with a 16:9 aspect ration, and 5MP selfie camera. An 8MP camera brings up the rear, with support for 1080p video recording.

At the time of writing the Redmi Go is being priced at 4,499 rupee (~$65). Albeit a mark-down graphic on the company’s website suggests the initial price may be a temporary discount on a full RRP of 5,999 rupees (~85). We’ve asked Xiaomi for confirmation.

Xiaomi’s website lists it as available to buy at 12PM March 22.

While Xiaomi is squeezing its entry level smartphone price-tag here, the Redmi Go’s cost to consumers in India still represents a sizeable bump on local feature phone prices.

For example the Nokia 150 Dual SIM candybar can cost as little as 1,500 rupees (~20). Though there’s clearly a big difference between a candybar keypad mobile and a full-screen smartphone. Yet 3x more expensive represents an immovable barrier for many consumers in the market.

The Redmi Go also looks intended to respond to local carrier Reliance Jio’s 4G feature phones, which are positioned — price and feature wise — as a transitionary device, sitting between a dumber feature phone and full-fat smartphone.

The JioPhone 2 launched last year with a price tag of 2,999 rupees (~40). So the Redmi Go looks intended to close the price gap — and thus try to make a transitionary handset with a smaller screen less attractive than a full screen Android-powered smartphone experience.

That said, the JioPhone handsets run a fork of Firefox OS, called KaiOS, which can also run lightweight versions of apps like Facebook, Twitter and Google.

So, again, many India consumers may not see the need (or be able) to shell out ~1,500 rupees more for a lightweight mobile computing experience when they can get something similar for cheaper elsewhere. And indeed plenty of the early responses to Xiaomi’s tweet announcing the Redmi Go brand it “overpriced”.

U.S. federal court jury finds Apple infringed three Qualcomm patents

Mobile chipmaker Qualcomm has chalked up another small legal victory against Apple in another patent litigation suit.

A jury in a U.S. federal court in San Diego found Friday that Apple owes Qualcomm about $31M for infringing three patents, per Reuters.

Qualcomm has filed a number of patent suits against the iPhone maker in the U.S., Europe and Asia in recent years. The suits are skirmishes in a bigger battle between the pair over licensing terms that Apple alleges are unfair and illegal.

As we reported earlier the San Diego patent suit relates to the power consumption and speed of boot-up times for iPhones sold between mid-2017 and late-2018.

Qualcomm had asked to be awarded up to $1.41 in unpaid patent royalties damages per infringing iPhone sold during the period.

Reuters suggests the award could have wider significance if it ends up factoring into the looming billion dollar royalties suit between Apple and Qualcomm. By putting a dollar value on some of the latter’s IP, the San Diego trial potentially bolsters its contention that its chip licensing practices are fair.

At the time of writing it’s not clear whether Apple intends to appeal. Reuters reports the iPhone maker declined to comment on that point, after expressing general disappointment with the outcome.

We’ve reached out to Apple and Qualcomm for comment.

In a statement provided to the news agency Apple said: “Qualcomm’s ongoing campaign of patent infringement claims is nothing more than an attempt to distract from the larger issues they face with investigations into their business practices in U.S. federal court, and around the world.”

Cupertino filed its billion dollar royalties suit against Qualcomm two years ago.

It has reason to be bullish going into the trial, given a preliminary ruling Thursday — in which a U.S. federal court judge found Qualcomm owes Apple nearly $1BN in patent royalty rebate payments (via CNBC). The trial itself kicks off next month.

The U.S. Federal Trade Commission also filed antitrust charges against Qualcomm in 2017 — accusing the chipmaker of operating a monopoly and forcing exclusivity from Apple while charging “excessive” licensing fees for standards-essential patents.

That trial wrapped up in January and is pending a verdict from Judge Lucy Koh.

At the same time, Qualcomm has also been pursuing several international patent suits against Apple — also with some success.

In December Apple filed an appeal in China to overturn a preliminary ruling that could have blocked iPhone sales in the market.

While in Germany it did pull older iPhone models from sale in its own stores in January. But by February it was selling the two models again — albeit with Qualcomm chips, rather than Intel, inside.

Google’s Lookout app helps blind people by telling them about their surroundings

Google’s Lookout app is now available for download, but only in the U.S., and only for owners of Pixel devices.

The AI-powered app, which has been undergoing testing since it was originally announced in May 2018, is designed to help blind and visually impaired people by identifying the objects around them. 

Lookout is easy to use: Once the app is started, all the user needs to do is point the phone forward. The app will identify people, text, objects and more as you move around and tell you what it sees. The app won’t swarm the user with unnecessary info, though, but rather only tell them about the things it thinks are important. 

[embedded content]

In a blog post announcing the launch, Google points out that, once the app is started (which can be done by asking Google’s Assistant to “start Lookout”) there’s no need to tap any further buttons. The company also suggests that the users either hang their Pixel phone around their neck or place it in a shirt pocket. 

The app has three modes of operation: Explore, which is best for daily tasks and chores, as well as new places. The app starts in this mode by default. The Shopping mode is meant to help with barcodes and currency, while the Quick read mode is best for sorting mail as well as reading signs and labels. The app recognizes some special gestures; you can read more about them as well as the various modes of operation on Google’s help page for Lookout

Google says that the app won’t always work with 100 percent accuracy, and that it will continue to develop the app as it gets more feedback from users. 

If you’re in the U.S. and own a Pixel, you can download Lookout for free, right now. Google says it’s working to bring the app to more devices, countries and platforms soon. 

Uploads%252fvideo uploaders%252fdistribution thumb%252fimage%252f86005%252f8b1c4533 26db 42f0 a795 62568e7e396b.png%252foriginal.png?signature= rjtunoky3whbwen03iof9q377q=&source=https%3a%2f%2fblueprint api production.s3.amazonaws

African e-commerce startup Jumia files for IPO on NYSE

Pan-African e-commerce company Jumia filed for an IPO on the New York Stock Exchange today, per SEC documents and confirmation from CEO Sacha Poignonnec to TechCrunch.

The valuation, share price and timeline for public stock sales will be determined over the coming weeks for the Nigeria-headquartered company.

With a smooth filing process, Jumia will become the first African tech startup to list on a major global exchange.

Poignonnec would not pinpoint a date for the actual IPO, but noted the minimum SEC timeline for beginning sales activities (such as road shows) is 15 days after submitting first documents. Lead adviser on the listing is Morgan Stanley .

There have been numerous press reports on an anticipated Jumia IPO, but none of them confirmed by Jumia execs or an actual SEC, S-1 filing until today.

Jumia’s move to go public comes as several notable consumer digital sales startups have faltered in Nigeria — Africa’s most populous nation, largest economy and unofficial bellwether for e-commerce startup development on the continent. Konga.com, an early Jumia competitor in the race to wire African online retail, was sold in a distressed acquisition in 2018.

With the imminent IPO capital, Jumia will double down on its current strategy and regional focus.

“You’ll see in the prospectus that last year Jumia had 4 million consumers in countries that cover the vast majority of Africa. We’re really focused on growing our existing business, leadership position, number of sellers and consumer adoption in those markets,” Poignonnec said.

The pending IPO creates another milestone for Jumia. The venture became the first African startup unicorn in 2016, achieving a $1 billion valuation after a $326 funding round that included Goldman Sachs, AXA and MTN.

Founded in Lagos in 2012 with Rocket Internet backing, Jumia now operates multiple online verticals in 14 African countries, spanning Ghana, Kenya, Ivory Coast, Morocco and Egypt. Goods and services lines include Jumia Food (an online takeout service), Jumia Flights (for travel bookings) and Jumia Deals (for classifieds). Jumia processed more than 13 million packages in 2018, according to company data.

Starting in Nigeria, the company created many of the components for its digital sales operations. This includes its JumiaPay payment platform and a delivery service of trucks and motorbikes that have become ubiquitous with the Lagos landscape.

Jumia has also opened itself up to traders and SMEs by allowing local merchants to harness Jumia to sell online. “There are over 81,000 active sellers on our platform. There’s a dedicated sellers page where they can sign-up and have access to our payment and delivery network, data, and analytic services,” Jumia Nigeria CEO Juliet Anammah told TechCrunch.

The most popular goods on Jumia’s shopping mall site include smartphones (priced in the $80 to $100 range), washing machines, fashion items, women’s hair care products and 32-inch TVs, according to Anammah.

E-commerce ventures, particularly in Nigeria, have captured the attention of VC investors looking to tap into Africa’s growing consumer markets. McKinsey & Company projects consumer spending on the continent to reach $2.1 trillion by 2025, with African e-commerce accounting for up to 10 percent of retail sales.

Jumia has not yet turned a profit, but a snapshot of the company’s performance from shareholder Rocket Internet’s latest annual report shows an improving revenue profile. The company generated €93.8 million in revenues in 2017, up 11 percent from 2016, though its losses widened (with a negative EBITDA of €120 million). Rocket Internet is set to release full 2018 results (with updated Jumia figures) April 4, 2019.

Jumia’s move to list on the NYSE comes during an up and down period for B2C digital commerce in Nigeria. The distressed acquisition of Konga.com, backed by roughly $100 million in VC, created losses for investors, such as South African media, internet and investment company Naspers .

In late 2018, Nigerian online sales platform DealDey shut down. And TechCrunch reported this week that consumer-focused venture Gloo.ng has dropped B2C e-commerce altogether to pivot to e-procurement. The CEO cited better unit economics from B2B sales.

As demonstrated in other global startup markets, consumer-focused online retail can be a game of capital attrition to outpace competitors and reach critical mass before turning a profit. With its unicorn status and pending windfall from an NYSE listing, Jumia could be better positioned than any venture to win on e-commerce at scale in Africa.