Home / Business and Economy / Xpeng Achieves First-Ever Quarterly Profit
Xpeng Achieves First-Ever Quarterly Profit
20 Mar
Summary
- Xpeng reported its first quarterly profit, driven by strong sales of higher-margin models.
- Technology partnerships, including a deal with Volkswagen, are boosting revenue.
- The company expects meaningful revenue from technology service fees with Volkswagen's new EVs.
Xpeng, a prominent Chinese electric vehicle manufacturer, has announced its maiden quarterly profit. This significant financial milestone was achieved in the October-December period, driven by strong sales of its higher-margin P7 model, which features advanced driver-assistance technology and fast charging capabilities. This positions Xpeng competitively against rivals like Tesla and Xiaomi in China's dynamic EV market.
The company is actively pursuing a strategy to license its advanced technology to other automakers, aiming to be recognized as a "physical AI" company. This approach has already resulted in a notable collaboration with Volkswagen, where the German automaker will develop new EVs in China utilizing Xpeng's technology. The first of these models, the ID. UNYX 08, has recently entered mass production, with Xpeng anticipating significant revenue from associated technology service fees.
Overall revenue for the fourth quarter reached 22.25 billion yuan, surpassing analyst expectations. Xpeng posted a profit of 383.21 million yuan, a substantial improvement from the 1.33 billion yuan loss reported in the same period last year. Analysts highlight Xpeng's second-generation "Vision to Action" architecture as a key differentiator, potentially enhancing autonomous driving features and boosting sales of premium models in the upcoming quarters.
Looking ahead, Xpeng anticipates first-quarter revenue to be between 12.20 billion yuan and 13.28 billion yuan. The company also announced plans to launch electric vehicles for the Latin American market at an event in Mexico later this month.
