On August 28th, Ideal Auto announced its Q2 2024 financial report. Data shows that the revenue in the second quarter reached 31.7 billion yuan, a year-on-year increase of 10.6%, once again setting a new high for the same period; Net profit reached 1.1 billion yuan, a year-on-year decrease of 52.3% and a month on month increase of 86.2%, slightly higher than market expectations; The adjusted net profit was 1.5 billion yuan, a year-on-year decrease of 44.9%. Among them, the total delivery volume of automobiles was 108581, a year-on-year increase of 25.5%; The gross profit margin was 19.5%, compared to 21.8% in the same period last year.
According to reports, Bloomberg commented on the financial report that although sales have rebounded, profits have not met analysts' expectations, and the price reduction of all its products has put pressure on profits. According to the financial report, Ideal Auto achieved a net profit of 1.1 billion yuan (equivalent to 154.4 million US dollars) in the three months ending in June, which is lower than the Bloomberg survey's average forecast of 1.82 billion yuan. Its net profit decreased by 52.3% year-on-year. In May of this year, Ideal CFO Li Tie stated that the second quarter would be the most difficult quarter the company has experienced this year.
Citigroup also released a research report stating that due to the slowdown in sales of BEV models and unfavorable supply-demand relations, the gross profit margin forecast for Ideal Auto in 2025 and 2026 has been lowered by 0.1 percentage points and 0.8 percentage points respectively to 18.8% and 17.9%, and the target price has been lowered from 113.8 yuan to 100.7 Hong Kong dollars. It is also expected that there is a risk of valuation downgrade in 2025.
It is worth noting that after the release of the financial report, as of the close of the US stock market on August 28th Eastern Time, Ideal Auto's stock price fell 16.12% to $17.8 per share, with a total market value of $18.89 billion. Compared to the market value on August 27th (22.551 billion US dollars), it decreased by 3.625 billion US dollars.
Affected by performance, on August 29th, the Hong Kong stock Ideal Automobile fell more than 14%, and as of press time, the decline narrowed to 9.62%, with a latest market value of approximately HKD 155.4 billion.
A brand new pure electric SUV will be launched in the first half of next year
Li Xiang, Chairman and CEO of Ideal Automobile, revealed at the performance meeting that a new pure electric SUV model will be released in the first half of 2025 to serve more household users.
For future pure electric new models, he said that for pure electric SUVs, two issues need to be addressed: one is the product's styling design, and the other is the ability to provide users with over 2000 supercharging stations when delivering pure electric products. Ideal Automobile still has great confidence in the competitiveness of pure electric SUVs and hopes to enter the first tier of high-end pure electric products in about two years.
At the same time, Ma Donghui, President and Chief Engineer of Ideal Automobile, stated that "Ideal Automobile will launch multiple 800V high-voltage pure electric vehicle models in 2025. In terms of research and development, the overall development progress is normal. Currently, multiple small-scale prototype production has been completed, and relevant tests and performance assessments such as high temperature and humidity, fatigue durability, etc. have been completed according to the calibration and testing verification plan. In terms of production capacity preparation in the industry chain, the overall progress is also progressing normally, and the production capacity planning of pure electric vehicle models can meet sales demand. The factory building for producing complete vehicles has been completed, and the production lines of the four major processes are being installed and debugged. In addition, the self-developed and self-made core components of Ideal pure electric vehicle models are also undergoing performance testing. The production capacity planning and development of external supplier partners are also underway. The progress is also proceeding smoothly according to the plan. We are confident that we can ensure the delivery of pure electric vehicle models as planned
According to the ideal product plan, by 2025, Ideal Automobile will have 5 extended range models, 1 super flagship (MEGA), and 5 pure electric models.
Li Xiang: Hongmeng Zhixing is the strongest competitor, and both sides will coexist healthily in the long run
Recently, Robotaxi has been a focus of attention for the market and analysts. Ma Donghui responded by saying, "Regarding Robotaxi, we believe that once L4 level autonomous driving is achieved, the demand for ride hailing and taxi services will significantly decrease, and this market will require more time to understand. Intelligent driving has been a key focus of investment and promotion for Ideal Auto since the beginning of this year. In terms of R&D expenses, the R&D expenses of Ideal Automobile reached 3 billion yuan in the second quarter, accounting for 10% of the revenue.
Li Xiang introduced that as of now, the user penetration rate of Ideal Auto's intelligent driving has exceeded 99%, and the cumulative NOA mileage in all scenarios has exceeded 1.11 billion kilometers. The user satisfaction and AD Max order proportion of intelligent driving are also continuously increasing.
Looking ahead to the third quarter, the expected quarterly delivery volume of Ideal Automobile is 145000 to 155000 vehicles, a year-on-year increase of 38.0% to 47.5%; The total revenue is expected to reach 39.4 billion yuan to 42.2 billion yuan, a year-on-year increase of 13.7% to 21.6%.
When it comes to market competition in the second half of the year, Li Xiang said, "HarmonyOS is Ideal's strongest competitor in the market, and we believe that both sides will coexist healthily in the long run. From another perspective, our core attitude is to learn from Huawei's technology research and development system and management system in the long run and continuously. As a start-up enterprise, such a learning model is very important for us
In addition, Li Xiang believes that the industry concentration will further increase. "In July of this year, the penetration rate of new energy vehicles in China has approached 50%, and people's recognition of smart electric vehicles is gradually surpassing that of fuel vehicles. Consumers are more inclined to purchase top brands with leading sales and large ownership bases, and the brand concentration in the new energy vehicle market will become increasingly apparent