Chinese electric vehicle manufacturer Li Auto posted strong third-quarter financial results, achieving record revenue and vehicle deliveries. However, fourth-quarter guidance seemed to underwhelm investors, despite the positive momentum.
For the third quarter, Li Auto reported revenue of 42.9 billion yuan ($6.1 billion), surpassing analyst expectations of 41.27 billion yuan and exceeding its own forecast range of 39.4 billion to 42.2 billion yuan. This marks a 23.6% increase from the same period in 2023 and a 35.3% rise from the previous quarter. Vehicle sales contributed 41.3 billion yuan to the total revenue, up 22.9% year-on-year and 36.3% from the prior quarter, driven largely by increased deliveries. However, the rise in sales was partially offset by a lower average selling price, reflecting shifts in product mix.
Li Auto reported record vehicle deliveries of 152,831 units, within its forecasted range of 145,000 to 155,000 units. This figure represents a 45.4% year-on-year growth and a 40.75% increase from Q2 2024. Net income for the quarter came in at 2.82 billion yuan, above analyst estimates of 2.38 billion yuan, representing a slight 0.3% increase from the previous year and a 156.2% surge from the second quarter. Non-GAAP net income rose to 3.9 billion yuan, an 11.1% year-on-year increase and a substantial 156.2% gain from Q2.
Gross margin for the quarter was 21.5%, a slight dip from 22.0% a year ago but an improvement from 19.5% in Q2. Vehicle margin rose to 20.9%, primarily due to lower production costs, though offset by the lower average selling price. R&D expenses dropped 8.2% year-on-year to 2.6 billion yuan, attributed to reduced spending on new product development and lower employee compensation.
Li Auto’s cash reserves reached 106.5 billion yuan at the end of September, up from 97.3 billion yuan at the end of Q2.
Looking ahead, Li Auto projects fourth-quarter vehicle deliveries of 160,000 to 170,000 units, reflecting a year-on-year increase of 21.4% to 29.0%. Fourth-quarter revenue is expected to be between 43.2 billion and 45.9 billion yuan, representing an annual increase of 3.5% to 10.0%. The company’s full-year guidance suggests it may deliver between 501,812 and 511,812 vehicles for 2024.
