The Evolution Of Xiaomi Company's Profit Model And Its Financial Effect

The profit model of Internet enterprises is significantly different from that of traditional enterprises,which is reflected in the process of continuous evolution under the influence of multiple factors.In after entering the mobile Internet era,millet company's growth rate than the same industry competitors,founded four years will only millet into the world's top three smartphone brand,and spent three years to build the world's largest consumer IoT platform,and in 2018 the top ten among the domestic Internet enterprises,Today,the overall strength of the company has already taken the lead in the entire Internet industry.Xiaomi's continuous innovation ability in the profit model has made it a successful model praised and emulated by the industry.As mobile Internet science and technology innovation in the enterprise,benchmarking millet company depending on the novel "hardware + Internet + new retail profit model in a short span of a few years of rapid development,now in advance the layout" smartphone + artificial intelligence Internet of things "dual strategy,exhibit excellent brand value,consciousness of the company's future potential.First of all,this paper elaborates the profit model theory of existing research,the research results of domestic and foreign scholars and the main profit model of the Internet industry,which lays the foundation for the case analysis of the following paper.Then,the key components of Xiaomi's profit model are analyzed from five aspects: profit object,profit point,profit source,profit leverage and profit barrier,and the evolution process of Xiaomi's profit model in three stages: "fan effect stage--integrated software and hardware stage--Internet service stage based on IoT platform" is deeply studied.Then,this paper studies the evolution of Xiaomi's profit model and its effects.SWOT analysis method and Dupont analysis method are used as the main analysis methods.The role of the former is to find Xiaomi's strategic layout through qualitative analysis,and the change of strategy will also change the profit model and affect financial indicators.Combined with Du Pont analysis method to study these indicators and reveal their financial effects.Analyze the relevant quantitative indicators and the operation effect of the profit model,and reveal the risks and problems existing in the evolution of Xiaomi's profit model,such as weak solvency,insufficient investment in new technology,decline in total asset turnover rate year by year,lower capital utilization efficiency and long-term quality problems under the production outsourcing model.Finally,this paper puts forward suggestions on the optimization of Xiaomi's profit model,such as increasing the investment in the research and development of core products,so as to enhance the core competitiveness;Strictly control financing risks and actively expand financing channels to reduce capital pressure;Increase the monitoring of the production process of products in the supply chain,so as to ensure the provision of high quality products and services for consumers;Appropriate hunger marketing,etc.It is hoped that Xiaomi can achieve more long-term development by giving full play to its existing advantages and achieve lasting success.In millet smartphone module,IoT and consumer-goods module,the Internet service module three main revenue field analysis of the industry competition situation,and through the significant changes on the effect of the company's financial data reflects the millet extremely innovative profit model has a unique competitive advantage,deeper and more comprehensive evaluation from the perspective of multiple millet profit model evolution of achievement,The conclusion is that Xiaomi's success is difficult to replicate,but its successful experience has a high reference significance and realistic reference value for other Internet enterprises seeking transformation and upgrading,that is,to choose a profit model suitable for their own development and continue to innovate on this basis.