Xiaomi shares fell on Wednesday. The Chinese electronics giant reported disappointing first-quarter earnings.
Higher component costs, especially memory chips, hurt its smartphone business.
The stock dropped nearly 3% to HK$28.88, a near one-month low. It was among the biggest drags on the Hang Seng index, which fell 0.9%.
First-quarter profit plunged 43% to 6.1 billion yuan ($899 million). Higher memory chip costs were the main culprit.
Domestic competition also intensified. Rivals like Apple and Huawei pressured Xiaomi.
While its electric vehicle business saw strong sales, heavy investment and thin margins weighed on overall earnings. Xiaomi is ramping up spending on EVs and AI to diversify.
The company plans to expand overseas to offset rising domestic costs and competition. It sees little relief from high memory costs due to AI demand.
