On November 9th, Ideal Automobile announced its third quarter financial report for 2023, with quarterly delivery volume and financial data both reaching historic highs.
Among them, 105100 vehicles were delivered in the third quarter, a year-on-year increase of 296.3%; The quarterly revenue was 34.68 billion yuan (RMB, the same below), a year-on-year increase of 271.2%. The operating profit and net profit for the same period were 2.34 billion yuan and 2.81 billion yuan, respectively, achieving four consecutive quarters of profit.
Looking ahead to the fourth quarter, Ideal Automobile is expected to deliver over 40000 vehicles per month, with a quarterly delivery volume expected to reach 125-128000 vehicles, a year-on-year increase of 169.9% to 176.3%; The quarterly revenue is expected to reach 38.46 billion yuan to 39.38 billion yuan, a year-on-year increase of 117.9% to 123.1%.
As of September 30th, the cumulative revenue of Ideal Automobile this year has reached 82.12 billion yuan. If the fourth quarter revenue meets expectations, it also means that Ideal Automobile will achieve a breakthrough of 100 billion yuan in annual revenue.
Ideal Automobile Official Website
Multiple indicators hit quarterly highs
Specifically, the total revenue of Ideal Automobile in the third quarter of this year was 34.68 billion yuan, an increase of 271.2% year-on-year and 21% month on month. The sales revenue of vehicles during the same period was 33.62 billion yuan, an increase of 271.6% year-on-year and 20.2% month on month; Other sales and service revenue was 1.06 billion yuan, an increase of 258.7% year-on-year and 56.2% month on month.
Ideal Automobile stated that the increase in revenue is mainly due to the increase in vehicle delivery, but at the same time, costs and expenses are also correspondingly increasing.
Data shows that the sales cost in the third quarter was 27.03 billion yuan, an increase of 231.3% year-on-year and 20.6% month on month. In terms of expenses, operating expenses, research and development expenses, as well as sales, general and administrative expenses, all increased in the third quarter compared to the same period last month. Among them, research and development expenses were 2.82 billion yuan, an increase of 56.1% year-on-year and 16.1% month on month.
Profitability continues to climb. The gross profit of Ideal Automobile in the third quarter was 7.64 billion yuan, an increase of 546.7% year-on-year and 22.6% month on month; The gross profit margin of vehicles was 21.2%, which remained unchanged year-on-year; The gross profit margin is 22%, compared to 12.7% in the same period last year and 21.8% in the second quarter of this year.
The operating profit in the third quarter was 2.34 billion yuan, compared to a loss of 2.13 billion yuan in the same period last year; The net profit was 2.81 billion yuan, while the net loss for the same period last year was 1.65 billion yuan.
In terms of cash flow, as of September 30, the cash position was 88.52 billion yuan. The net cash received from operating activities in the third quarter was 14.51 billion yuan, and the free cash flow was 13.22 billion yuan, both reaching quarterly highs.
Ideal MEGA will be officially released in December this year
Regarding the highly anticipated progress of Ideal MEGA, Li Xiang, Chairman and CEO of Ideal Automobile, revealed at the third quarter financial report performance meeting that the first 5C pure electric super flagship model, Ideal MEGA, is progressing smoothly and will be officially released in December this year, with delivery starting in February next year.
We believe that the ideal MEGA equipped with an 800V high-voltage platform and achieving a 5C charging rate will open a new chapter for ideal cars in the pure electric market, and work together with extended range technology to promote the process of large-scale replacement of traditional fuel vehicles. "Li Xiang said, and at the same time, in conjunction with the promotion of the pure electric strategy, Ideal is accelerating the construction of a super charging network.
Li Xiang also revealed that MEGA will lead the industry in terms of vehicle safety, functional configuration, comfort, and other aspects under the traditional automotive value system. In addition, Li Xiang stated that all pure electric vehicle products in the future will have three important breakthroughs: breakthrough in charging (charging for 500 kilometers in 12 minutes), breakthrough in space (any product will have the largest space in its class), and breakthrough in styling.
The release of MEGA will be the core focus of Ideal in the fourth quarter of this year, with pricing expected to exceed 500000 yuan. The ideal "ambition" is to make MEGA the best-selling product with a monthly sales volume of over 10000 yuan.
According to the management of Ideal Automobile at the performance meeting, in high-end cities, the market share of Ideal Automobile in the SUV market of over 300000 yuan has reached 50%, but the average market share of all products of Ideal Automobile is less than 20%, which means there is still great room for growth in the future.
Overall, Ideal will continue to focus on first tier cities, new first tier cities, and second tier cities, with a focus on increasing the market share of top cities. In addition, Ideal has also begun to accelerate its store opening speed in third and key fourth tier cities. It is expected that by the end of this year, the number of retail stores of Ideal Automobile in third and fourth tier cities will exceed 110.
Regarding the competition with Huawei, Li Xiang stated at the performance meeting that the ideal attitude towards Huawei is to learn 80%, respect 20%, and complain 0%. As a startup, we are very fortunate and excited to encounter such a trillion dollar revenue model of technology that we can learn from as we enter the revenue scale of hundreds of billions. This is our true mindset
According to the research report of CICC, the overall trend of new energy vehicle development has not changed, or will still be one of the industries with faster growth in the future. The core driving force in the future will shift from subsidies to product strength and fuel electricity parity. Looking forward to 2024, it is expected that global new energy vehicle sales are expected to achieve a year-on-year growth of about 30%.
Li Tie, the Chief Financial Officer of Ideal Automobile, stated in the financial report that the continuously increasing profitability and sufficient cash reserves will continue to support Ideal Automobile's investment in research and development, and continuously strengthen its sustainable long-term competitiveness. Li Xiang also stated that as the business scale continues to expand, it will maintain healthy profitability and continue to invest in research and development to support the long-term development of Ideal Automobile.