Xpeng (NYSE:XPEV) shares fell more than 7% in pre-market Friday after the company reported worse-than-expected gross margins for its second quarter.
XPeng reported revenue of CNY 5.06 billion (CNY 1 = $0.1372) for the second quarter, in line with analyst estimates. A loss per share of CNY 3.10 is worse than the expected loss of CNY 2.19 per share.
“Benefitting from the new products and supported by more efficient sales channels, our vehicle deliveries have posted sequential growth for six consecutive months,” said Dr. Hongdi Brian Gu, honorary vice chairman and co-president of XPENG.
“With the G6 and other new products accelerating sales growth, we expect gross margin to gradually recover while operating efficiency continues to improve and free cash flow to substantially improve."
The gross margin stood at -3.9%, which contrasts with the estimated gross margin of 4.8%.
For the third quarter of 2023, the company expects to deliver between 39,000 and 41,000 EV units, representing a year-over-year increase of approximately 31.9% to 38.7%.
Total revenue is seen in the range of CNY 8.5-9.0B, representing a YoY increase of approximately 24.6% to 31.9%.