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Haier Smart Home, a Chinese company specializing in internet-connected appliances and customized smart living solutions, reported a 15% decline in first-quarter profits compared to the previous year. The company primarily attributed this decrease to harsher winter weather in North America and increased import tariffs.
In the three months ending March 31, the company’s net profit reached 4.65 billion yuan (approximately $680 million), according to its earnings report released yesterday. Revenue declined by 6.9%, totaling 73.7 billion yuan (around $10.7 billion).
The firm explained that severe weather events, including snowstorms, led to a 10% drop in the North American market. Additionally, tariff costs experienced a significant increase year-over-year.
Shares of the company closed at 21.34 yuan ($3.12) in Shanghai today, up 4%. Since the end of last year, the stock has fallen over 18%.
Weak demand within China’s domestic home appliance market also impacted earnings. Data from home appliance research firm AVC revealed that total retail sales of appliances (excluding computers, communication devices, and consumer electronics) dropped 6.2% during the quarter.
In response to tariff pressures and softer demand, the company accelerated its reforms. It expanded its direct-to-consumer sales model in China, with such orders accounting for 65% of total sales—up from 57% a year earlier.
Meanwhile, the company fast-tracked the integration of its large HVAC (heating, ventilation, and air conditioning) division. Domestic sales of residential air conditioners grew despite the overall trend, while European HVAC revenue increased by over 20%. The company also leveraged artificial intelligence to enhance operational efficiency across all processes.
Additionally, the firm highlighted growth in its overseas markets outside North America, emphasizing progress in emerging economies and advancing the transformation of its European operations.
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