The new energy sector is undoubtedly a key investment theme for the next 10, 20, or even 50 years. In 2025, Contemporary Amperex Technology Co., Ltd. (CATL) reported revenue of approximately 423.7 billion yuan, a year-on-year increase of 17.04%. Net profit attributable to shareholders reached about 72.2 billion yuan, surging 42.28% year-on-year. It is remarkable that a company of such massive scale, with revenue in the hundreds of billions and net profit exceeding 50 billion yuan, continues to achieve rapid growth, particularly in net profit. This performance defies expectations for a firm of its size.
Breaking down the figures reveals even more impressive results. In the fourth quarter, revenue hit 140.6 billion yuan, a 37% increase year-on-year, while net profit soared to 23.167 billion yuan, up 57.13% year-on-year. Both figures significantly surpassed market expectations. The primary driver behind this exceptional performance was higher-than-anticipated battery shipments. Total lithium-ion battery shipments in Q4 reached 226 GWh, a 56% year-on-year increase, exceeding market forecasts. Power battery shipments alone amounted to 192 GWh in Q4, representing a 48% sequential growth.
This surge is particularly notable given that the sequential growth rate of domestic new energy vehicle sales in Q4 had slowed to approximately 10-15%. CATL's shipment growth substantially outpaced the overall market. In contrast, energy storage shipments in Q4 were only 34 GWh, showing almost no sequential growth. This was unexpected, as the energy storage market remained strong in Q4, with sequential growth estimated between 15-20% based on various statistics. As the global leader in energy storage, it is unusual for CATL to underperform the broader market. The more plausible explanation is capacity constraints. The new capacity at the Jining base in Shandong, planned to exceed 100 GWh, has not yet been operationalized and is expected to be available earliest in the first quarter of this year, which should alleviate pressure on energy storage capacity.
This capacity constraint is further evidenced by the utilization rate. The full-year 2025 capacity utilization rate reached 96.9%. In the second half of the year, utilization entered full production status at 102.6%. This is a stark contrast to the 70% utilization rate seen in 2024. Additionally, there is a significant amount of goods dispatched but not yet confirmed as revenue. By year-end, inventory included over 40 billion yuan in goods dispatched, a substantial increase from the 24 billion yuan at the beginning of the year. While this contributed to the lower-than-expected energy storage figures, it also provides a solid foundation for performance in the coming year.
Gross margin continued to improve, reaching 26.27% for the full year, an increase of nearly 1 percentage point compared to 2024. The Q4 gross margin was particularly strong at 28.2%, up 2.4 percentage points sequentially. Both power battery and energy storage battery margins showed improvement. This was achieved despite a rise in lithium carbonate prices from 70,000-80,000 yuan per ton in Q3 to 80,000-100,000 yuan per ton in Q4, while CATL's average battery selling price remained largely stable sequentially. This highlights the company's significant scale advantages and superior management capabilities. The stable selling price amidst rising raw material costs is likely attributable to an increased proportion of lithium iron phosphate (LFP) batteries and the time lag in price adjustments between battery manufacturers and downstream customers, as many Q4 deliveries were based on previous orders.
In summary, CATL's 2025 financial results far exceeded expectations, solidifying its leading position. There has been a significant expectation gap regarding the company. While concerns existed about growth ceilings due to slowing penetration rates of new energy vehicles domestically and potential stagnation internationally—leading to subdued secondary market performance post-Q3—the annual report demonstrates that increases in the penetration of large-capacity batteries and gains in market share have not only offset overall market slowdown but have allowed CATL to significantly outperform. One could argue that CATL's net profit represents a substantial portion of the entire new energy vehicle market's earnings.
With a market capitalization exceeding 1.7 trillion yuan and revenue over 4 trillion yuan, questions about future growth potential naturally arise. The company's perspective, termed "global incremental growth," provides the answer. Theoretically, all drive systems can be electrified, or more radically, "everything can be electrified." Management elaborates that the company is expanding its product and service applications beyond passenger vehicles into commercial vehicles, electric ships, and electric aviation. In the new energy heavy-duty truck sector, its "Tianxing" battery has become a mainstream choice. Nearly 900 ships are equipped with CATL batteries, with pure-electric vessels poised for ocean-going routes in the near future. In low-altitude mobility, affiliated company Fengfei Aviation's 2-ton eVTOL has completed multiple complex environment flight tests, and the world's largest 5-ton eVTOL has made its first public flight.
CATL is also evolving its business model from selling products to providing services, promoting battery-swapping models and vehicle-battery separation to enhance user experience. It is collaborating with partners like Sinopec to build efficient charging networks. By the end of 2025, the company had cumulatively built 1,325 battery swap stations. Partnering with multiple automakers, it has launched battery-swappable vehicle models. Management emphasizes that in the future energy system dominated by renewables, batteries will serve as fundamental units for buffering, stabilizing, and dispatching power, transforming new energy into long-term, systematic infrastructure rather than cyclical investment assets. Understanding this vision provides confidence in CATL's long-term growth trajectory.
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