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Xiaomi doesn't 'make a single dime' on phones

The Chinese electronics maker is laying the groundwork for direct sales to US consumers, executive Hugo Barra tells Reuters.

Xiaomi's Mi Mix is probably what most phones will look like a few years from now and if this glimpse into the future is any indication. Sold only in China (though you can get the phone from online third party retailers), the review model costs 3,499 yuan, which converts to around $510, AU$680 or £420. There's also a premium model with 18-carat gold embossing and 6GB RAM, 256GB of onboard storage for 3,999 yuan (approximately $590, AU$770 or £480).
Aloysius Low/CNET

Xiaomi's phones sales may have dropped some, but the Chinese device maker isn't worried.

"Basically we're giving [handsets] to you without making any money," said Hugo Barra, Xiaomi's global vice president, in an interview with Reuters. "We could sell 10 billion smartphones and we wouldn't make a single dime in profits."

Xiaomi's phone business isn't just about selling hardware, Barra told Reuters, it's about recurring revenue from services over many years. The company also expects profit growth to be driven by sales of smart home devices and its software ecoystem.

Xiaomi didn't immediately respond to a request for comment.

Xiaomi has already made investments in India and Asia, and is now laying the groundwork for direct sales to US consumers, said Barra.

Xiaomi plans to unveil an all-new product at CES 2017, its first trip to the electronics trade show. But details are slim, and the product might not be a phone. Xiaomi is known for selling electronics of all kinds -- including phones, fitness bands, electric bikes, robot vacuums and even a rice cooker -- at lower prices than its rivals.

Now playing: Watch this: The futuristic Xiaomi Mi Mix is amazing