BYD recently released its 2026 third-quarter report. Data shows that in the third quarter, the company achieved operating revenue of 221.488 billion yuan, a year-on-year increase of 13.59%; net profit attributable to shareholders of the listed company was 10.020 billion yuan, a year-on-year increase of 28.08%, marking the first time since 2025 that quarterly net profit has returned above ten billion yuan. For the first three quarters, BYD's attributable net profit was 22.345 billion yuan, still down 4.24% year-on-year, while non-recurring net profit was 21.004 billion yuan, up 2.51% year-on-year.
In the third quarter, the most direct source of BYD's performance improvement was exports. Quarterly global sales reached 1.3231 million vehicles, up 18.7% year-on-year; among them, exports totaled 550,700 vehicles, a year-on-year increase of 137%, accounting for about 42% of total sales. In the first three quarters, BYD's cumulative overseas sales reached 1.34 million vehicles, up 91% year-on-year, with business covering more than 120 countries and regions worldwide. Against the backdrop of weak demand in the domestic auto market, the rapid rise in export volume provided support for capacity utilization and revenue scale.
The profit implications of exports are more important than the sales volume implications. The domestic 100,000 to 150,000 yuan price band is where BYD's sales base is relatively concentrated, and it is also a segment where price competition was relatively fierce in 2026. In this range, downward pressure on per-vehicle selling prices persists, while overseas markets provide relatively higher pricing space for some models. Second-quarter data shows that BYD's per-vehicle selling price fell from about 160,000 yuan in the first quarter to about 136,000 yuan, but per-vehicle core operating profit actually rose from about 3,000 yuan in the same period last year to about 9,000 yuan, with cost-side compression partially offsetting the impact of price declines.
An upward shift in product mix is another path for BYD to hedge against domestic pricing pressure. In the first three quarters, the three major high-end brands—Fangchengbao, Denza, and Yangwang—together sold 410,000 vehicles, up 75% year-on-year, accounting for more than 13% of total sales. The increase in the share of high-end models drove a year-on-year improvement in gross margin, which is one of the few profitability quality indicators in the financial report that can hold true without relying on sales scale.
However, divergence within the high-end product line is also significant. In September alone, Fangchengbao sold 43,000 vehicles, up 79% year-on-year; Denza sold 18,000 vehicles, up 46.7% year-on-year; while Yangwang sold only 389 vehicles, down 48.7% year-on-year. Among the three brands, Fangchengbao contributed the main sales increment, with cumulative sales of about 242,300 vehicles in the first three quarters, accounting for nearly 60% of the combined sales of the three major brands.
The other side of the quarterly profit recovery is the pressure simultaneously accumulating on the balance sheet. As of the end of September, BYD's inventory stood at 221.58 billion yuan, up 60% from the end of the previous year; accounts receivable rose 53% year-on-year; notes payable rose to 78.86 billion yuan, a sharp year-on-year increase of 251%. The company explained that the rise in inventory and accounts receivable was mainly related to the expansion of its overseas auto business, as overseas transportation cycles, channel buildout, and localized stocking naturally require longer capital occupation cycles. During the same period, cash and short-term financial assets were 71.72 billion yuan, down 45% year-on-year. Cash spending on factory and equipment investment was 87.38 billion yuan, down 24% year-on-year, indicating that the pace of capital expenditure has somewhat moderated. In the first three quarters, net cash flow from operating activities was 54.47 billion yuan, up 33.36% year-on-year. Operating cash flow itself is not weak, but relative to the expansion speed of inventory and accounts receivable, cash conversion efficiency faces marginal narrowing. In the first three quarters, net cash flow from financing activities was -23.082 billion yuan, a year-on-year decrease of 124.744 billion yuan.
The contraction in domestic sales is another pressure that must be confronted. In the third quarter, BYD's domestic sales were about 770,000 vehicles, down 12% year-on-year. In September alone, domestic sales were 283,000 vehicles, down 13% year-on-year. Although this represented a month-on-month increase of 12.8%, and a trend of continuous month-on-month improvement has emerged, the year-on-year decline has not yet been reversed.
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