Zhejiang Leapmotor Technology (9863) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue reached CNY 12 billion (RMB 10,020 million), up 187% year-over-year, with gross profit margin at a record 14.9% compared to 13.3% in Q4 2024.

• Net loss narrowed significantly to CNY 130 million (RMB130 million) from about CNY 1 billion (RMB1,010 million) a year ago; cash reserves stood at CNY 25.7 billion (RMB25,700 million).

• Vehicle deliveries hit 87,552 units in Q1 2025, up 162.1% year-over-year, with the C series accounting for 77.5% of sales.

• Overseas expansion accelerated, with exports leading among new energy vehicle startups and localized manufacturing planned in Malaysia and Europe.

• Multiple product and design awards were achieved, including launches of B10 SUV and B01 sedan.

Financial highlights

• Gross profit margin improved to 14.9% in Q1, driven by higher sales, optimized product mix, and cost management.

• Sales cost reduced by 26.9% compared to Q4 2024, supporting margin expansion.

• R&D expenses rose 52% year-over-year to RMB 800 million, reflecting increased investment in technology and talent.

• Net cash generated from operating activities was RMB340 million, up from RMB (1,180) million in Q1 2024.

• Free cash flow improved to RMB (360) million, compared to RMB (1,500) million in Q1 2024.

Outlook and guidance

• Q2 gross profit margin expected to decline slightly due to new model launches and product transitions, but sales are projected to remain robust.

• Annual sales guidance remains at 500,000–600,000 units with a gross profit margin target close to 10%, aiming for annual break-even.

• Plans to expand into 80 new cities and counties by end-2025, targeting 90% urban coverage of prefecture-level cities or above.

• Localized manufacturing in Europe expected by 2026, with Malaysia assembly of C10 by end-2025.

• No intention to adjust annual objectives or guidance at this stage.