1 hour ago
2
Key Takeaways
- The Chinese EV company reported Q2 earnings per share loss of $0.11, significantly wider than analyst expectations of a $0.06 loss
- Second-quarter revenue totaled $3.8 billion, representing a decline from $4.2 billion in the prior year period
- The company experienced an 11% year-over-year decrease in vehicle deliveries, reaching 98,330 units during Q2
- Vehicle profit margins deteriorated dramatically to 9.4% from 19.4% in the same quarter last year
- Third-quarter revenue forecast of approximately $4 billion fell substantially short of the $4.9 billion Wall Street consensus
Shares of Li Auto declined approximately 1% during Wednesday’s premarket session following the release of the Chinese electric vehicle manufacturer’s second-quarter 2026 financial results, which revealed both disappointing earnings and cautious forward-looking guidance.
The automaker reported second-quarter revenue of $3.8 billion, marginally surpassing the analyst consensus of $3.7 billion. However, profitability disappointed significantly, with Li Auto recording an earnings loss of $0.11 per American Depositary Receipt, considerably worse than the $0.06 per share loss Wall Street projected. For comparison, the company generated approximately $0.10 in earnings per share on $4.2 billion in revenue during the same quarter last year.
In early Wednesday trading, ADRs changed hands at $12.12, representing a 1.2% decline, while S&P 500 futures dipped only 0.1%, indicating the selloff was predominantly driven by company-specific factors rather than broader market weakness.
Prior to Wednesday’s session, Li Auto’s ADRs had already declined 28% year-to-date and approximately 45% to 50% over the trailing twelve months, hovering near the 52-week low of $11.65.
Sales Volume and Profitability Face Headwinds
The company’s vehicle deliveries decreased 11.5% on a year-over-year basis to 98,330 units during the second quarter. Through the end of July, Li Auto had shipped approximately 224,000 vehicles, representing a 5% year-over-year decline.
Perhaps more concerning was the dramatic erosion in vehicle margin performance. Profitability per vehicle plummeted to just 9.4% from 19.4% during the comparable period in 2025, underscoring the intense pricing pressure and heightened competition characterizing China’s electric vehicle marketplace.
CEO Xiang Li attempted to highlight positive elements, noting that Li Auto maintained its position as the top-selling domestic brand in China’s premium EV segment priced above $30,000 during the first half of 2026. He also emphasized robust order momentum for the refreshed Li L6 SUV following the updated L series product range launch.
Third-Quarter Outlook Significantly Misses Expectations
The forward guidance presented perhaps the most challenging aspect of the report. Li Auto projected third-quarter revenue of approximately $4 billion, dramatically below the $4.9 billion consensus forecast from analysts. This substantial shortfall indicates that the demand recovery many investors anticipated is not materializing on the expected timeline.
The company also forecast Q3 vehicle deliveries of roughly 97,500 units, representing a modest sequential decline from Q2 levels while showing approximately 5% year-over-year growth.
Following the earnings release, no analyst upgrades or significant insider purchasing activity materialized that might counterbalance the negative sentiment from the disappointing results.
Competing Chinese EV manufacturers including NIO and XPeng have encountered similar challenges stemming from sluggish consumer demand and challenging macroeconomic conditions throughout China.
The Nasdaq traded modestly lower on Wednesday, providing minimal support for technology and growth-oriented equities like Li Auto.
The post Li Auto (LI) Shares Decline Following Weak Q2 Results and Disappointing Q3 Forecast appeared first on Blockonomi.
English (US) ·