Shares of Chinese electric vehicle company XPeng (NYSE: XPEV) surged Wednesday despite missing analyst consensus estimates in its third-quarter earnings release.
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.
The company posted a wider-than-expected net loss of 2.38 billion Chinese yuan versus the 2.09 billion yuan expected. It was also wider than the 1.59 billion reported during the same period last year. However, it narrowed from the second quarter.
Top Broker Recommendation
- eToro Top stock trading platform with 0% commission – Read our Review
- Tickmill Regulated by the FCA – Read our Review
- Admirals (Admiral Markets) More than 4500 stocks & ETFs available – Read our Review
- Spreadex Spreadex has been around for a long time – Read our Review
- IG Top-tier regulation – Read our Review
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY
Revenue came in at 6.82 billion Chinese yuan or $960.9 million, compared to the consensus estimate of 7.26 billion yuan. Revenue rose 19.3% year-on-year.
XPeng shares rose over 47% in Wednesday's session, hitting levels last seen in early October. The company's shares were able to brush off the disappointing earnings as investors took encouragement from potential changes to China's Covid policy, which has continued to impact the company.
XPeng's total vehicle deliveries during the quarter were 29,570, representing an increase of 15% from 25,666 in the same period last year.
“Our management team has recently conducted an in-depth review of our growth strategy, products and operation. We have already carried out organization restructuring and changed some of our strategies,” commented He Xiaopeng, Chairman and CEO of XPeng.
Meanwhile, Dr. Hongdi Brian Gu, Honorary Vice Chairman and President of XPeng, stated that the company will “implement prudent cost control initiatives and improve operational efficiency.”
“As we plan a number of upcoming product and technology rollouts, we are confident that we can achieve significant improvement in both sales volumes and average selling price,” he added.
Rival Chinese electric vehicle firms Li Auto and NIO also gained during Wednesday's session, with Li closing the day up 18% and NIO finishing 21% higher.
On Thursday, XPeng released its November delivery report. The company delivered 5,811 vehicles in November, up from the 5,101 vehicles delivered in October. The company said it worked to mitigate the challenging operating backdrop as a result of Covid restrictions in China, which impacted its flagship G9 model's production ramp-up and delivery in certain areas.
However, it expects deliveries will “significantly increase” in December 2022 as the G9 model production ramp-up “accelerates under normalized operating conditions.”
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.