Li Auto Profit Slides as Sales, Margins Deteriorate

By Jiahui Huang

Li Auto recorded a sharp drop in quarterly profit as the Chinese plug-in hybrid specialist grapples with flagging sales while it tries to make headway in the highly competitive full-electric market.

The company remains one of the few Chinese EV makers to have turned a profit, but it has faced challenges from a slowdown in demand for plug-in hybrids and a lukewarm response to its battery EV lineup as well as intensifying competition from other high-sales brands.

The automaker on Thursday said fourth-quarter net profit fell sharply to 6.5 million yuan, equivalent to roughly $950,000, from 3.52 billion yuan a year earlier. Analysts had expected 150.2 million yuan, according to a Visible Alpha consensus estimate.

Revenue fell 35% to 28.78 billion yuan, missing analysts' estimates of 32.41 billion yuan. That came as Li Auto sold 109,194 vehicles in the final three months of 2025, a 31% decline from the previous year.

Its gross margin fell to 17.8% from 20.3% a year earlier, though it was higher than 16.3% in the third quarter. The company said the margin weakness was due to a different product mix.

For the first quarter, Li Auto said it expects to deliver 85,000 to 90,000 vehicles. Revenue is expected to fall 17% to 21% to between 20.4 billion yuan and 21.6 billion yuan.

The company's full-year net profit fell 86% to 1.12 billion yuan and revenue dropped 22% to 112.31 billion yuan. Its 2025 gross margin declined to 18.7%.

The Chinese automaker's American depositary receipts fell about 3.2% in premarket trading.

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

(END) Dow Jones Newswires

March 12, 2026 05:25 ET (09:25 GMT)