Analysis of Xiaomi's Investment Value from the Perspective of Duan Yongping's 'Certainty' Methodology

Duan Yongping’s investment criteria of ‘certainty, moat, opposition to cost-effectiveness, and avoidance of diversification’ have a fundamental conflict with Xiaomi’s business strategy. Xiaomi’s Q3 2025 financial report shows that its automotive business achieved its first quarterly profit of 700 million yuan [0], but social media analysis [2] points out that the ‘500,000 units delivered in 19 months’ data has not been officially verified, and the automotive business has only launched one model, the SU7, so its product matrix needs to be improved [0]. Market sentiment is cautious; Xiaomi’s stock price (1810.HK) has fallen by 35.07% since the beginning of Q3 [0], and even the automotive business’s profit has not reversed the volatile downward trend.

At the ecosystem chain level, the network effect of Xiaomi’s 5000+ products is difficult to quantify using traditional methods due to the lack of public data on cross-product linkage [2], which conflicts with Duan Yongping’s ‘certainty’ criteria. At the same time, Duan Yongping clearly opposes cost-effectiveness and diversification [2][3], while Xiaomi takes cost-effectiveness as its core strategy and carries out diversified businesses, further deepening the methodological conflict. The automotive industry has frequent price wars [2], so the sustainability of Xiaomi Auto’s profit is questionable, and there is no clear factual basis for the change in the definition of moat in the AIoT era [2].

1. The essence of Xiaomi being ‘ununderstandable’ is the conflict between traditional investment certainty standards and betting on business models of the next decade, reflecting the adaptability issue between innovative enterprises and traditional value investment methodologies.
2. The difficulty in quantifying the ecosystem chain’s network effect reflects the complexity of Xiaomi’s business model; traditional financial indicators (such as P/E Ratio 20.24x, ROE 18.65% [0]) are difficult to comprehensively evaluate its long-term value.
3. Although the first profit of the automotive business indicates improved operational efficiency, factors such as a single model and the risk of industry price wars still pose challenges to profit certainty, and the market has already given negative feedback (stock price decline).

: The automotive industry is highly competitive, and price wars may weaken profit levels [2]; the ecosystem chain lacks cross-product linkage data, making it difficult to evaluate the value of network effects [2]; the conflict between Duan Yongping’s methodology and Xiaomi’s strategy may affect long-term investor confidence [2][3].
: Xiaomi’s layout in AIoT and automotive fields has future growth potential, and some investors recognize its long-term value [2]; the profit breakthrough of the automotive business proves operational capabilities, and the subsequent improvement of the product matrix may enhance competitiveness [0].
: The risk of sustainability of automotive business profits is a short-term focus, and the issue of quantifying ecosystem chain value is a long-term core challenge.

Xiaomi’s layout in AIoT and automotive fields has potential, but there is a fundamental conflict with Duan Yongping’s ‘certainty’ investment methodology. The first profit of the automotive business did not reverse the stock price decline trend; the ecosystem chain’s network effect is difficult to quantify; and intensified competition in the automotive industry increases profit uncertainty. Investors need to seek a balance between traditional value investment standards and betting on future business models, and pay attention to subsequent developments such as the improvement of the automotive product matrix and the disclosure of ecosystem chain data.