Xiaomi Lays Off 10% of Staff Amid China Covid Crisis

Xiaomi Corp is the latest Chinese tech company to lay off workers, saying it will cull staff in its smartphone and internet services segments.

The news comes as the country battles a severe wave of Covid-19 outbreaks.

China’s social media platforms, including Weibo, Xiaohongshu and Maimai, have been flooded with posts about job cuts this week.

Chinese local media first reported on Monday that the job cut would affect 15% of Xiaomi’s payroll, citing unnamed sources.

But a company spokesperson said on Tuesday less than 10% of its total workforce would be affected by its “personnel optimization” and streamlining.

The spokesperson said the staff affected have been compensated in compliance with local regulations.

Many big tech companies in China including Tencent Holdings and Alibaba Group have been laying off workers in recent months as China became mired in a prolonged battle with Covid outbreaks.

Xiaomi had 35,314 staff as of September 30, according to the South China Morning Post, with over 32,000 in mainland China, and the latest move could affect thousands of workers, many of whom had just joined the firm during a hiring spree that began in December last year.

Xiaomi in November reported a 9.7% fall in third-quarter revenue, hit by China’s Covid restrictions and softening consumer demand. Revenue from smartphones, which make up roughly 60% of its total sales, fell 11% year-on-year, Xiaomi said.