Li Auto (LI) Q2 2024 earnings summary

Executive summary

• Q2 2024 deliveries reached 108,581 vehicles, up 25.5% year-over-year, with strong sales in the premium NEV segment and continued market share gains.

• Achieved cumulative deliveries of 900,000 vehicles by August 21, 2024, setting new records for Chinese premium auto brands.

• Maintained leadership in the RMB 200,000+ SUV market, with L7 and L8 topping mid-to-large SUV sales and L9 remaining a top full-size SUV.

• Net income was RMB 1.1 billion, down 52.3% year-over-year but up 86.2% quarter-over-quarter.

• Gross margin was 19.5%, down from 21.8% a year ago and 20.6% in the prior quarter.

Financial highlights

• Q2 2024 total revenue reached RMB 31.7 billion, up 10.6% year-over-year and 23.6% quarter-over-quarter.

• Vehicle sales were RMB 30.3 billion, up 8.4% year-over-year and 25% sequentially.

• Free cash flow was negative RMB 1.9 billion, compared to positive RMB 9.6 billion a year ago.

• Cash position stood at RMB 97.3 billion as of June 30, 2024.

• Operating income was RMB 468 million, down 71.2% year-over-year but a turnaround from a RMB 584.9 million loss in Q1 2024.

Outlook and guidance

• Q3 2024 vehicle deliveries expected between 145,000 and 155,000 units, up 38% to 47.5% year-over-year.

• Q3 total revenues projected at RMB 39.4–42.2 billion, up 13.7% to 21.6% year-over-year.

• Management expects margin and cash flow improvement in H2 2024 as new model production stabilizes and cost measures take effect.

• CapEx guidance for 2024 revised down to $1.1–1.2 billion from $2 billion.

• Free cash flow expected to turn positive from Q3 2024.