By Jiahui Huang

XPeng's loss narrowed for the fourth straight quarter and revenue beat expectations, thanks to robust sales of new car models and record margins.

The Chinese electric-vehicle maker's net loss narrowed to 1.81 billion yuan, equivalent to about $250 million, from 3.89 billion yuan a year earlier, it said Tuesday. The bottom line, however, missed the 1.60 billion yuan net loss estimated by analysts in a Visible Alpha poll.

Revenue climbed 18% to 10.10 billion yuan, slightly better than analysts' expectations of 10.04 billion yuan, which the company attributed to higher deliveries and stronger revenue from its technical collaboration with Volkswagen.

XPeng continued to improve its gross margin, which rose to a record 15.3% from 14.0% in the second quarter. Its gross margin was a negative 2.7% a year earlier.

The encouraging results came as the Guangzhou, China-based company enjoyed strong order momentum following the launch in late August of the Mona M03, a fully electric sedan aimed at the mass market. The EV maker's Hong Kong-listed shares have shot up as a result, soaring nearly 80% in the third quarter.

Earlier this month, it launched the P7+ sedan, a battery EV featuring an AI-powered advanced driver-assistance system similar to Tesla's, with prices starting from about $26,000. By comparison, the U.S. EV maker's Model 3 starts from around $32,000 in China.

"The successful launch of M03 and P7+ marks the beginning of a strong growth cycle underpinned by our major product cycles," Chief Executive He Xiaopeng said Tuesday. "Our core competences and execution capabilities have been significantly transformed."

Known for its high-end software-driven smart EVs, XPeng has targeted the mid- to low-price segments lately, hoping to woo price-sensitive customers with its autonomous-driving technology.

Citi called it a sensible and rational move, though it said in a recent note that lower-end customers aiming to own an EV may still prioritize price over advanced driving features.

XPeng has made a name for itself as one of China's top EV makers since its founding in 2014, but the company has yet to turn a profit. Despite the recent rally in its share price, the stock remains nearly 10% lower in Hong Kong this year.

For the fourth quarter, the EV maker forecast deliveries to rise 45%-51% to 87,000-91,000 vehicles and revenue to increase 17%-24% to between 15.3 billion yuan and 16.2 billion yuan.

Write to Jiahui Huang at jiahui.huang@wsj.com

(END) Dow Jones Newswires

November 19, 2024 05:54 ET (10:54 GMT)

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