Even though the third-quarter financial reports fell short of forecasts, XPeng stock (NYSE:XPEV) surged to a double-digit increase. The Chinese EV maker reported a loss on top and bottom lines as well as a 90 basis point reduction in gross margins for the third quarter. Vehicle deliveries increased by 15% from 2021 to 29,570 per quarter. Deliveries for the year have increased to 103,654, up 56% from the previous year.
However, since the fourth quarter of 2021, deliveries have been declining quickly, making a comparison for the company’s guidance difficult. The anticipated delivery of 20,000 to 21,000 vehicles in the fourth quarter signifies a drop of roughly 49.7% to 52.1% from Q4 2021. According to management projections, total revenues are expected to drop by a comparable amount, up to 43.9%.
President Hongdi Brian Gu and CEO He Xiaopeng expressed confidence in the restructuring measures being made to get the company back to growing market share. Gu also concentrated on improving the bottom line after ongoing losses contributed to the stock’s over 85% drop in 2022.
Gu promised that they would “adopt smart cost containment strategies and enhance operational effectiveness.” “We are confident that we can achieve a considerable improvement in both sales volumes and average selling price as we prepare a number of upcoming product and technology rollouts,” the company said.
The Guangzhou-based automaker’s shares increased by 30.3% shortly after the market opened on Wednesday.
The victory looked to be aided by the removal of some extremely tight COVID-19 restrictions in its home city of Guangzhou following protests. On Wednesday, major Chinese indexes surged substantially as indications of regulatory rollbacks increased the likelihood that future anti-pandemic actions will be less forceful. Along with the anticipated policy changes, Chinese automakers Li Auto (LI) +15.84% and NIO Inc. (NIO) +18.41% saw significant price increases.
See more information on the earnings performance.
- Misses by $0.08 on Q3 Non-GAAP EPADS of -$0.36.
- $960M (+19.3% Y/Y) in revenue falls short by $35.53M.
- Vehicle deliveries for the quarter increased year over year by 15% to 29,570.
- The gross margin for the quarter was 13.5%, down 0.9 percentage points year over year.
- In the third quarter of 2022, 16,776 P7 smart sports sedans were delivered, a 15% down from 19,731 in the same period of 2021.
- 8,703 P5 smart family sedans were delivered during the quarter.
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