Company guides for third-quarter deliveries up as much as 7.3%

Li Auto reported the loss for the three months ended June on Wednesday, compared with a net profit of 1.09 billion yuan a year earlier. The result marked the Beijing-based company’s second consecutive quarterly loss.

Demand for Li Auto’s extended-range EVs has softened as some buyers held off purchases ahead of model upgrades, while its push into the battery-EV market has not gained the same traction. Competition in China, the world’s largest auto market, has remained fierce, forcing price discounts that have chipped away at margins.

Revenue of 25.67 billion yuan slightly exceeded the 25.17 billion yuan market expectation, according to a Visible Alpha consensus estimate. Vehicle deliveries of 98,330 in the quarter represented an 11% decline from a year earlier.

Profitability remained under pressure. The company’s vehicle margin was 9.4%, while its gross margin stood at 11.0%. Both rose from the 6.1% and 7.9% reported in the first quarter; Li Auto attributed the change to a different product mix.

For the third quarter, Li Auto guided for deliveries of between 95,000 and 100,000 vehicles, up 1.9% to 7.3% from a year earlier. It projected third-quarter revenue of between 26.6 billion yuan and 28.0 billion yuan, roughly stable from a year earlier.

“We anticipate further margin expansion for the second half of the year as our product mix optimizes, with a higher sales contribution from the Livis trim and the launch of refreshed BEV models and Li i9,” Chief Financial Officer Li Tie said.

The company launched the new Li L8 in June and unveiled the redesigned Li L6 the following month. The Li L6, previously one of the company’s biggest volume drivers, now comes equipped with Li Auto’s self-developed Mach M100 AI chip, designed for its assisted-driving system.

There are early signs the product refresh is starting to gain traction. Li Auto delivered 30,468 vehicles in July, with the year-over-year pace of decline easing to about 1%.

Li Auto has also been expanding overseas. The company began local production of its L-series lineup in Kazakhstan in July, starting with the flagship Li L9, after signing distribution agreements earlier this year with dealers in Saudi Arabia and the United Arab Emirates for the same lineup.

The company has said it plans to launch the all-electric Li i6 in Europe in the second half of 2026 and to bring a right-hand-drive version of its Li MEGA minivan to key Asia-Pacific markets by the end of the year.

American depositary receipts of Li Auto were recently about 1% lower in premarket trading after the results.