Xiaomi, the world’s fourth-largest smartphone merchant, on Wednesday, shared its profits figures for the quarter that ended in September. 

While the outcomes fell widely in line with analysts’ expectations, a severe drop in the company’s growth marks some of the struggles that handset makers are suffering as they shift to services to make up for decreasing smartphone purchases globally.

More About The Latest Income 

The Chinese electronics firm shared a Q3 income of 53.7 billion yuan or $7.65 billion, up 3.3% from 51.95 billion yuan ($7.39 billion) income recorded in Q2 and 5.5% increase after Q3 2018.

This is broadly in line with analysts’ expected income of 53.74 billion yuan, per Refinitiv figures, but the extension is slowing. 

As a purpose of comparison, in Q2, Xiaomi announced a QoQ increase of 18.7% and YoY of 14.8%.

Xiaomi stated its adjusted earnings in the quarter mentioned above were 3.5 billion yuan ($500 million), up from around 2.5 billion yuan a year ago. 

Gross profit through the period was 8.2 billion yuan ($1.17 billion), higher 25.2% year-over-year.

The company told its smartphone business income during Q3 reached 32.3 billion yuan ($4.6 billion), dropping 7.8% year-over-year. 

The company, which exported 32.1 million smartphone units during the period, accused the “downturn” in China’s smartphone market for the decline.

A person holding mobile in hand | iTMunch

The Gradual Shift of Revenue Source

Xiaomi stated two years ago that it will hardly ever earn a 5% profit from its hardware.

However, the gradual shift to earning money off of internet services, while making less money from selling hardware, is one of the main reasons why the company had an underwhelming IPO.

Meantime, the user base of Xiaomi’s Android-based MIUI software is increasing. 

It had 292 million regularly active users as of September this year, higher from 278.7 in June.

In more assuring signs, Xiaomi stated its smart TV and Mi Box programs had more than 3.2 million satisfied subscribers.

Plus income from its fintech business, a region it started only in recent quarters, had previously reached 1 billion yuan ($140 million).

In a report, Xiaomi founder and director Lei Jun said the company is confident that it will be ready to increase its revenues further when 5G devices start to get traction. 

The company has projects to start at least ten 5G-enabled smartphone models next year, he said. 

SEE ALSO8 Tech Trends To Look Out For In 2020

For more updates and the latest tech news, keep reading iTMunch!