Xiaomi’s Memory, EV Woes Hand Short Sellers $1.8 Billion Payout

Short sellers betting against Xiaomi Corp. are reaping big gains, as surging memory prices and weakening electric-vehicle sales cloud the company’s earnings outlook.

Its Hong Kong-listed stock has tumbled 44% from a September high, making it the biggest drag on the Hang Seng Tech Index in that span. That drop yields $1.8 billion in paper profits for short sellers that have piled into the stock, according to data from S3 Partners LLC.