LI — Li Auto Inc.

Summary of Li Auto Q1 2026 Earnings Call

1. Key Financial Results and Metrics

• Total Revenues: RMB 23 billion, down 11.4% year-over-year and 20.1% quarter-over-quarter.
• Vehicle Sales: RMB 21.5 billion, down 12.7% year-over-year and 21% quarter-over-quarter.
• Gross Profit: RMB 1.8 billion, a decline of 66% year-over-year and 64.8% quarter-over-quarter.
• Vehicle Margin: 6.1%, significantly down from 19.8% a year ago and 16.8% in the previous quarter.
• Net Loss: RMB 2.3 billion, compared to a net income of RMB 646.6 million in Q1 2025.
• Cash Position: RMB 94.3 billion, with a negative free cash flow of RMB 7.4 billion.
• Share Repurchase: USD 1 billion program initiated, with 17.5 million shares repurchased to date.

2. Strategic Updates and Business Highlights

• Sales Performance: Li Auto regained the top position in the Chinese NEV market (RMB 200,000 and above) with monthly sales of the BEV model Li i6 stabilizing at 20,000 units.
• Product Launches: The all-new Li L9 launched on May 15, with over 10,000 orders within two weeks. The Li L8 is set to launch in late June.
• Technological Advancements: Deployment of the MAHE M100 chip and MindVLA model, enhancing vehicle intelligence and performance.
• Store Partner Program: Enhanced sales team performance and operational efficiency through empowering store managers.

3. Forward Guidance and Outlook

• Q2 2026 Deliveries: Expected between 95,000 and 100,000 vehicles.
• Revenue Guidance: Anticipated quarterly revenues between RMB 24.1 billion and RMB 25.4 billion.
• Full-Year Growth Target: Maintaining a sales growth target of 20% for the year.

4. Bad News, Challenges, or Points of Concern

• Declining Financial Metrics: Significant drops in revenues, gross profit, and net income raise concerns about profitability.
• Operating Losses: A loss from operations of RMB 3 billion indicates ongoing financial strain.
• Production Constraints: Limited supply of certain components affecting the production ramp-up of new models.
• Rising Raw Material Costs: Potential impact on profitability and gross margins moving forward.

5. Notable Q&A Insights

• L9 Order and Production Capacity: The Livis variant dominates orders, with production capacity expected to reach 4,000-5,000 units per month.
• Profitability Outlook: Gross margin expected to recover to about 10% in Q2, with a focus on completing the refresh of the L Series.
• Autonomous Driving Development: Significant improvements with the MAHE M100 chip, aiming to match Tesla's FSD performance by the second half of the year.
• International Expansion: Plans to enter Middle East and Southeast Asian markets, with tailored products for local conditions and regulations.

This summary encapsulates Li Auto's current financial standing, strategic initiatives, and future outlook while highlighting areas of concern and insights from the Q&A session.