Li Auto's Q1 Revenue Beats Expectations, But Flips to Loss

Li Auto achieved revenue of 23 billion RMB in the first quarter of 2025, exceeding the market estimate of 22.09 billion RMB. However, the company recorded an adjusted net loss of 2.12 billion yuan for the quarter, a significant deterioration from a profit of 1.02 billion yuan in the same period last year, reflecting the profitability pressures faced by the company during its scale expansion.

The loss margin was better than market expectations. The adjusted loss per ADS was 2.09 yuan, while the market had previously estimated a loss of 2.38 yuan. The shift from profit to loss is a microcosm of the changes in Li Auto's operational status over the past few quarters.

The company provided positive guidance for the second quarter, expecting revenue to reach 24.1 to 25.4 billion RMB, continuing to grow quarter-over-quarter.

Revenue exceeds expectations but profitability is under pressure

The 23 billion RMB revenue performance in the first quarter was about 4% higher than the market's consensus expectation. This indicates that Li Auto's delivery volume and revenue per vehicle still have a certain resilience.

However, the pressure on the profitability side is more noteworthy. An adjusted net loss of 2.12 billion yuan implies that under multiple factors such as R&D investment, new model advancement, and intensified market competition, it is difficult for the company to maintain its previous profit levels in the short term.

In the same period last year, the company still achieved an adjusted net profit of 1.02 billion yuan. Turning from profit to loss within one year, and the margin exceeded 3 billion yuan, reflects the erosion of profit margins in China's new energy vehicle market price war.

Second quarter guidance releases confidence

Li Auto estimates that the revenue range for the second quarter will be between 24.1 and 25.4 billion RMB, with a midpoint of about 24.75 billion RMB, an increase of approximately 7.6% quarter-over-quarter compared to the first quarter.

This guidance indicates that the management is relatively optimistic about the delivery pace and product mix in the second quarter. If the guidance is fulfilled, it will be a further rebound in the company's revenue.

The core variables to follow up next include whether the gross margin can stabilize and rebound, whether the loss margin can narrow, and the impact of the new models on overall sales.