Xiaomi Corp. posted its first-ever quarterly profit from its electric vehicle business, marking a key milestone in the smartphone maker’s push into China’s highly competitive EV market.

The EV unit, which launched its first model last year, reported a profit of 700 million yuan ($98 million) in the September quarter, swinging from a 300 million yuan loss in the previous three months. The turnaround helped more than double the company’s overall net income.

With the result, Xiaomi joins the small group of Chinese EV makers that are profitable. Aiming to become one of the world’s top five automakers, the company is ramping up production as it takes on Tesla Inc. and BYD Co. in China and, eventually, overseas. Xiaomi plans to begin selling its electric vehicles in Europe by 2027.