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In contrast in 2021 Xiaomi's Cost of Sales (COGS?) was 82.3% of their annual revenue Source: 2021 Annual report https://ir.mi.com/static-files/b85f34c0-0010-4

• alain94040 4y ago
  Cost of sales includes marketing expenses. Possibly also operations cost.
• refulgentis 4y ago
  Cost of Sales is not Cost of Goods Sold
  • ac29 4y ago
    In this accounting context, yes it is edit: source here, since other people are making the same mistake https://www.investopedia.com/ask/answers/112614/whats-difference-between-cost-goods-sold-cogs-and-cost-sales.asp https://www.investopedia.com/ask/answers/112614/whats-differ...
    • jhugo 4y ago
      To be clear, the OP discusses COGS in an electronics/manufacturing context, which refers specifically to the cost of manufacturing the product, and excludes things like marketing, logistics, R&D, salaries etc. It is not at all comparable to the Xiaomi Cost of Sales figure in GP which includes many things beyond the direct cost of manufacturing their devices.
      • tomnipotent 4y ago
        COGS is completely company-dependent, there is no universal exact definition so long as it can be verified to be GAAP/IFRS compliant (which is more art than science).
        • refulgentis 4y ago
          This is broadly correct but specifically incorrect: cost of sales includes ex. salaries and capital investments and cost of goods sold includes the literal cost of the raw materials for a good It's quite jarring to see someone jump in with another misunderstanding, derailing the correction, especially given this is a "hoofbeats, think horses, not zebras" situation. Any argument they're kinda sorta the same thing or it's ambiguous, they could be the same thing, leaves open the Q of how exactly Xiaomi can possibly fund itself if 83% of it's costs are raw materials
          • tomnipotent 4y ago
            Somebody is confidently wrong. There is no standard definition for "cost of sales", or "cost of goods sold". No where in any GAAP or IFRS literate does it say that the term "cost of sales" have specific definitions other than a paragraph or two of ambiguous wording. Indeed, IAS is even careful to say "allocating costs to functions may require arbitrary allocations and involve considerable judgement". The Xiaomi filing doesn't breakdown what it includes in cost of sales, so we're left guessing without a supplemental to fill in the details. You're welcome to make whatever wilder guesses you like, but they're still just guesses.
            • refulgentis 4y ago
              Like I said, you're broadly correct, and specifically correct. It is unknowable, but, that's not helpful information. It's sort of like if there was an accounting message board where they bickered about it's unknowable if memory usage meant RAM or L2 cache because L2 cache is also memory I'm out, you're free to live in a world where you can't tell basic information about the health of a company because you're obsessive about ensuring anything you don't grok must be modelled as ambiguous by everyone else.
• j16sdiz 4y ago
  Cost of sales include wage and salary for the storefront.