Li Auto Inc. reported second-quarter 2026 revenue of RMB25.70 billion (USD3.82 billion), down 15.1% year on year but 11.7% higher than the previous quarter, as the company navigated a model-refresh cycle and intensified competition in China’s new-energy vehicle (NEV) market.
Gross profit fell 53.3% year on year to RMB2.84 billion, pulling gross margin down to 11.0% from 20.1% a year earlier; vehicle margin compressed to 9.4% from 19.4% over the same period, though it improved from 6.1% in Q1 2026. Operating expenses edged down 2.0% to RMB5.14 billion, yet the margin squeeze pushed Li Auto to an operating loss of RMB2.30 billion versus a RMB0.83 billion profit in Q2 2025.
The company booked a net loss of RMB1.71 billion (USD251.32 million), contrasting with a RMB1.10 billion profit a year ago but narrower than the RMB2.28 billion loss in Q1 2026. Non-GAAP net loss stood at RMB1.50 billion. Diluted loss per ADS was RMB1.69.
Despite earnings pressure, liquidity remained robust. Cash, cash equivalents, time deposits and investments totaled RMB87.50 billion (USD12.90 billion) at 30 June 2026. Operating activities generated a marginal RMB15.03 million of cash, reversing outflows in the prior two quarters, while free cash flow improved to negative RMB1.30 billion from negative RMB7.39 billion in Q1.
Operationally, Q2 deliveries reached 98,330 vehicles, down 11.5% year on year but up 3.4% sequentially. As of 30 June, Li Auto’s domestic footprint comprised 495 retail stores across 160 cities, 536 service centres in 220 cities and 4,097 super-charging stations with 22,593 stalls.
Product upgrades underpinned the quarter: June saw the launch of the all-new Li L8 (Ultra and Livis trims), priced at RMB369,800 and RMB429,800 respectively, followed by July’s introduction of the RMB249,800 Li L6. The company also unveiled new AI-powered in-cabin technologies at its “Livis Day” event and continues to refresh its battery-electric vehicle line-up.
Under the USD1.0 billion share-repurchase programme announced in March 2026, Li Auto bought back approximately 91.70 million Class A shares by mid-August for a total consideration of about USD631.50 million.
Guidance for Q3 2026 targets vehicle deliveries of 95,000–100,000 units, implying up to 7.3% year-on-year growth, and revenue between RMB26.60 billion and RMB28.00 billion. Management expects further margin recovery in the second half as refreshed models and higher-priced trims gain traction, supported by a continued focus on operational efficiency.
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