Key Takeaways:
XPENG reported a first-half net loss of RMB3.12 billion, widening from RMB1.14 billion a year earlier, as vehicle sales revenue dropped 10.3 percent.
"The back-to-back success of the GX and MONA L03 gives us greater confidence in our upcoming new models, as we translate our leading edge in smart technologies and design into more blockbuster products and stronger brand momentum," Xiaopeng He, Chairman and CEO of XPENG, said.
Total revenue for the six months ended June 30 was RMB32.78 billion, down 3.8 percent year over year. Vehicle sales contributed RMB28.05 billion, while services and other revenue rose to RMB4.73 billion. Gross margin improved 4.1 percentage points to 20.6 percent, though vehicle margin slipped 0.5 points to 12.1 percent. The company declared no interim dividend.
The results come as XPENG faces intensifying competition in China's EV market, where domestic car sales have declined since late last year as weak consumer demand and years of price competition left the world's biggest auto market with excess capacity. The company guided third-quarter deliveries of 115,000 to 121,000 vehicles and revenue of RMB21.7 billion to RMB23.4 billion — below the RMB26.61 billion analysts had expected, according to LSEG data. US-listed shares fell 3.1 percent in premarket trading, extending this year's decline of about 40 percent.
For the second quarter alone, total revenue was RMB19.74 billion, up 8 percent year over year and 51.5 percent quarter over quarter. Vehicle sales revenue reached RMB17.05 billion, up 1 percent year over year and 55 percent sequentially. The quarterly net loss of RMB1.34 billion compared with a RMB480 million loss in the same period of 2025 and a RMB1.78 billion loss in the first quarter of 2026. Gross margin for the quarter was 20.7 percent, up 3.4 percentage points year over year.
Q2 deliveries totaled 103,295 vehicles, roughly flat from 103,181 a year earlier. The company's physical sales network reached 740 stores across 257 cities, and its self-operated charging network expanded to 3,780 stations, including 2,720 ultra-fast charging points. XPENG also recalled 264,842 EVs as part of a broader China recall involving about 4.3 million vehicles over emergency door-release concerns.
Research and development expenses rose 32.1 percent year over year to RMB2.91 billion in the second quarter, driven by new vehicle models and AI-related technologies. Selling, general and administrative expenses increased 15.2 percent to RMB2.50 billion on higher marketing and advertising costs.
XPENG's robotics subsidiary Dogotix raised US$900 million in its first funding round, a record for a single private financing in China's embodied AI sector. The company also launched the MONA L03 AI SUV coupe in Munich on July 16. July deliveries reached 38,027 vehicles, bringing year-to-date deliveries to 204,004.
The widening loss and revenue guidance below consensus point to near-term pressure on XPENG's profitability as it invests heavily in physical AI and robotics. Investors will watch the Q3 earnings call for updates on vehicle margin recovery and the commercialization timeline for the humanoid robot program.
This article is for informational purposes only and does not constitute investment advice.
