Li Auto Inc.

Total revenue in Q1 2026 was RMB 23 billion, down 11.4% year over year and 20.1% quarter over quarter. Vehicle sales were RMB 21.5 billion, down 12.7% year over year and 21% quarter over quarter. Gross profit was RMB 1.8 billion, down 66% year over year and 64.8% quarter over quarter; gross margin was 7.9% versus 20.5% a year ago. Vehicle margin was 6.1% versus 19.8% a year ago. Operating loss was RMB 3 billion, operating margin was negative 13%, net loss was RMB 2.3 billion, and diluted net loss per ADS was RMB 2.26. Cash and equivalents ended at RMB 94.3 billion. For Q2 2026, management guided deliveries of 95,000 to 100,000 vehicles and revenue of RMB 24.1 billion to RMB 25.4 billion. Management also said gross margin should recover to about 10% in Q2.

Xiang Li framed Q1 as the start of a recovery in deliveries and said Li Auto returned to the top position in sales among Chinese brands in the RMB 200,000-and-above NEV market from January to April. He emphasized the new L9 launch, the upcoming L8 and broader L Series refresh, and the company’s in-house MAHE M100 chip and MindVLA stack as the basis for a longer-term technology moat. His tone was confident and strategic, with repeated focus on product positioning, embodied AI, and maintaining the company’s full-year sales growth target of 20%.

Johnny Tie Li said the quarter was pressured by model refresh timing, lower average selling prices from mix, and seasonal delivery weakness around Chinese New Year. He quantified the impact with Q1 gross margin at 7.9%, vehicle margin at 6.1%, operating cash outflow of RMB 6.1 billion, and free cash flow of negative RMB 7.4 billion, while noting a solid quarter-end cash balance of RMB 94.3 billion. He also highlighted capital returns through a USD 1 billion share repurchase program, with 17.5 million Class A ordinary shares repurchased to date for a total consideration of USD 148.1 million.

Analysts focused on L9 order strength, wait times, production capacity, and how much the new model mix could support margins. Management said the L9 Livis makes up over 90% of orders, current monthly production capacity for the new L9 and L8 is 4,000 to 5,000 units during the ramp, and Q2 L9 deliveries should be around 8,000 units, with a higher level expected after the Q3 ramp-up. On profitability, management said Q1 margins were hurt by the refresh cycle and the higher mix of i6 and L6, but gross margin should recover to about 10% in Q2 and continue improving through the year as the lineup is refreshed.