* Barra cites health concerns, new Silicon Valley role
* Xiaomi fell out of top 5 Chinese vendors last year
* China market key for firm’s strong comeback in 2017 -analyst (Adds details on Barra’s replacement, analyst comment)
By Cate Cadell
BEIJING, Jan 23 (Reuters) - Hugo Barra, the most prominent global executive at China’s Xiaomi Inc, has left the smartphone maker citing health concerns and a new job, dealing a fresh setback to a firm that is struggling to recover ground ceded to rivals.
In a post on Facebook on Monday, Barra, Xiaomi’s vice president in charge of global operations and the face of its international expansion, said he was leaving the company after three-and-a-half years for a new project based in Silicon Valley.
Xiaomi was briefly the world’s most valuable startup with a valuation two years ago of $45 billion and had hopes to be China’s equivalent of Apple Inc. But the firm has grappled with slowing smartphone sales and fell out of the top five in China for smartphone vendors in 2016, after reaching No. 2 in 2015.
“The last few years of living in such a singular environment have taken a huge toll on my life and started affecting my health,” Barra, 40, said in the Facebook post.
“Seeing how much I’ve left behind these past few years, it is clear to me that the time has come to return.”
Based in Beijing, Barra often travelled to other strategically important markets including India and his home country of Brazil.
Barra’s exit comes at a time Xiaomi is trying to adjust its strategy. The company has pulled back from several overseas markets, including Singapore and Brazil, in 2016. It is increasing its offline retail presence and aims to develop artificial intelligence and internet finance as growth areas.
India was the one of the few bright spots on the company’s international growth map last year, and is also where Barra opted to make his final public appearance for the company during a launch event in New Delhi last Thursday.
In a letter released to employees earlier this month, Xiaomi Chief Executive Officer Lei Jun said “the worst is over”, referring to the company’s recent struggles to keep up with an ever increasing number of local competitors.
“For Xiaomi to return strongly in 2017 the biggest priority is the China market,” says Nicole Peng, senior analyst at Canalys.
Barra’s replacement, senior vice president Xiang Wang, will oversee the company’s global efforts going forward, a spokeswoman confirmed.
Formerly the President of Qualcomm’s greater China operation, Xiang joined Xiaomi in 2015 to oversee strategic partnerships.
“Given his international experience he’s a very safe pair of hands,” said Peng. “However they are very different types of persons and have a different type of leadership style.”
For Barra, the role involved many roadblocks, including a halt of production in Brazil due to the country’s economic instability.
Barra said he would officially leave the role after Lunar New Year, which runs until Feb. 2, and take time off before embarking on a new role. He did not specify the role.
Reporting by Cate Cadell in BEIJING, Vishal Sridhar in Bengaluru; Editing by Christopher Cushing and Muralikumar Anantharaman