Li Auto Inc. reported a wider-than-expected loss for the second quarter of 2026, with revenue missing market forecasts as gross margins nearly halved from a year earlier.
The Beijing-based electric vehicle manufacturer posted a net loss of 1.7 billion yuan ($245 million) in Q2 2026, compared with a 1.1 billion yuan profit in the same period of 2025. Revenue declined 15.1% year-over-year to 25.7 billion yuan, below the 30.77 billion yuan consensus estimate and down from 29.11 billion yuan in the previous quarter.
Gross profit fell 53.3% to 2.8 billion yuan, pushing the overall gross margin to 11%, compared with 20.1% in Q2 2025 and 7.9% in Q1 2026. Vehicle gross margin contracted to 9.4% from 19.4% a year earlier, reflecting pricing pressure and higher input costs. Operating expenses rose 6.9% quarter-over-quarter to 5.1 billion yuan, resulting in an operating loss of 2.3 billion yuan and an operating margin of negative 9%.
Adjusted earnings per American Depositary Share (ADS) came in at negative 0.4587 yuan, missing expectations of negative 0.3097 yuan by 48.11%. The company repurchased 23.7 million ADS and 91.7 million Class A ordinary shares for $631.5 million during the quarter, ending with 87.5 billion yuan in cash.
Li Xiang, chairman and CEO, said the company maintained its lead in China’s premium new energy vehicle market despite a product refresh cycle and intensifying competition. He reiterated a long-term gross margin target of 15% to 20%, citing raw material prices as the primary variable. Management expects Q3 2026 deliveries of 95,000 to 100,000 vehicles and revenue of 26.6 billion to 28 billion yuan.
The company outlined plans to expand its product lineup, including the launch of the Li MEGA on September 2, 2026, and the all-new Li L9 flagship BEV SUV in mid-September. The Li L6 BEV version is scheduled for debut at the Paris Motor Show in October, with European sales slated for Q4. Li Auto also plans to enter markets in Dubai, Hong Kong, and Singapore.
Li Auto’s supercharging network grew to 4,141 stations with over 22,800 stalls by the end of July, covering 18 national-level highways and nearly 300 cities. Shipments of its in-house Mach M100 chip exceeded 50,000 units since production began in May.
Shares of Li Auto traded at $48.10, up 0.88% on the day, after touching a 52-week low of $45.26 and high of $105.30.
