Chinese EV Maker Li Auto Q2 Earnings: EPS Beat, 25% Deliveries Growth, Margin Struggles And More

Li Auto Inc LI reported fiscal second-quarter 2024 revenue growth of 10.6% year-on-year to $4.36 billion, marinally missing the analyst consensus of $4.45 billion. 

It clocked an adjusted net earnings per ADS of $0.20, which beat the analyst consensus of $0.19.

Vehicle sales increased 8.4% to $4.2 billion, mainly due to the increase in vehicle deliveries. Total vehicle deliveries were 108,581 units in the quarter, a 25.5% year-over-year increase.

The vehicle margin declined by 230 bps year over year to 21.0%, mainly due to changes in product mix and pricing strategy. The gross margin decreased by 230 bps year over year to 21.8%, mainly due to reduced vehicle margin. 

Adjusted income from operations was $119.7 million, down by 57.4% Y/Y. Adjusted net income plunged 44.9% Y/Y to $206.8 million.

Li Auto held cash and equivalents of $13.4 billion as of June 30, 2024, and used $59.1 million in operating cash flow for the quarter.

As of June 30, 2024, the company had 497 retail stores covering 148 cities, 421 servicing centers, Li Auto-authorized body and paint shops operating in 220 cities, and 614 supercharging stations with 2,726 charging stalls.

In July 2024, the company delivered 51,000 vehicles, representing an increase of 49.4% from April 2023.

Chair and CEO Mr. Xiang Lil said, "In June 2024, we surpassed the 800,000-vehicle milestone in cumulative deliveries, making history for Chinese premium automotive brands. In addition to our strong sales results, we made substantial progress in autonomous driving. In July, we rolled out our high-definition map-independent NOA with nationwide coverage to over 240,000 Li AD Max users and launched our next-generation autonomous driving technological architecture that integrates an E2E model and a VLM."

Outlook: Li Auto expects third-quarter revenue of $5.4 billion—$5.8 billion, representing an increase of 13.7%–21.6% year over year versus analyst consensus of $5.74 billion.

LI expects third-quarter vehicle deliveries of 145,000 – 155,000, representing an increase of 38.0%–47.5% year over year.

Li Auto stock plunged 47% in the last 12 months as the Chinese EV industry battled lackluster domestic demand and protectionist tariffs.

Price Action: LI shares traded lower by 0.80% at $21.39 in premarket at the last check on Wednesday.

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