Li Auto (LI, Financial) announced its financial results for the third quarter of 2024, revealing a record-high revenue of 42.874 billion yuan, marking a 23.6% increase year-over-year. The company's net profit also rose to 2.82 billion yuan, a slight increase of 0.3%, marking its eighth consecutive profitable quarter. Operating cash flow for the quarter was 11 billion yuan, with cash reserves reaching 106.5 billion yuan.
Notably, Li Auto's gross margin rebounded above 20%, achieving 21.5%, with vehicle gross margin at 20.9%. Vehicle deliveries in the third quarter reached an unprecedented 152,800 units, a 45.4% increase compared to the same period last year.
Looking ahead, Li Auto anticipates fourth-quarter deliveries to range between 160,000 to 170,000 units, representing a 21.4% to 29% growth from the previous year. Expected quarterly revenue is projected to fall between 43.2 billion to 45.9 billion yuan, an increase of 3.5% to 10%. The full-year 2024 delivery target is set between 502,000 to 512,000 units.
Despite these positive figures, the modest quarterly growth forecast has disappointed investors. As a result, Li Auto shares dropped by 13.58% in U.S. markets and by 7.08% in Hong Kong markets.
Li Auto attributed its revenue growth to the strong sales of its L series models. CEO Li Xiang highlighted the significant market penetration of new energy vehicles (NEVs) in China, surpassing traditional fuel vehicles for the first time in the quarter. In the NEV segment priced above 200,000 yuan, Li Auto's market share increased from 14.4% in the second quarter to 17.3% in the third quarter.
The company disclosed that its L6 model faces high demand, exceeding current production capacity. Plans are in place to expand production by early 2025 to meet consumer demand. Analysts view the fourth-quarter delivery forecast as conservative, but Li Auto remains confident in its market position.
Regarding its electric vehicle strategy, the company is expanding its fast-charging network, already operating over 1,000 supercharging stations across 31 provinces and 175 cities in China.
CEO Li Xiang emphasized the future role of artificial intelligence in transforming driving experiences. Li Auto is ramping up investments in AI-driven technologies, focusing on intelligent driving and integrating AI-centric solutions. By continuously enhancing its AI models, Li Auto aims to provide superior autonomous driving experiences and improve vehicle safety.
Research and development expenses for the first three quarters of 2024 totaled 8.66 billion yuan, reflecting a 22.1% increase. The company has spent over 12 billion yuan on R&D in the past year.
Finally, Li Auto announced plans to venture into overseas markets, specifically targeting the Middle East and Central Asia, while reserving any expansion into Western Europe and North America for later consideration.
