XPeng gave muted EV delivery guidance Tuesday after posting a less-than-feared loss for the fourth quarter. XPeng stock rebounded near a key level.
The Chinese EV price war intensified in March as XPeng and BYD slashed prices.
XPeng Earnings
Estimates: Analysts expected the China EV startup to lose 41 cents per American depositary share, slightly wider than a 40-cent loss a year ago. Revenue was seen rebounding 135% to $1.757 billion, according to FactSet.
Results: Early Tuesday, XPeng delivered a 21-cent loss, far less than feared. Revenue rose 143% to $1.813 billion, also ahead of views, FactSet shows.
Gross margin improved quarter over quarter, reaching 6.2%.
The startup previously reported 60,158 EV deliveries in Q4, up quarter over quarter and year over year.
Outlook: XPeng guided deliveries of 21,000-22,500 electric vehicles in the current first quarter, implying a recovery in March from a sharp decline in February.
But analysts at Deutsche Bank were expecting around 25,000 Q1 deliveries.
On Tuesday, the company affirmed plans to launch 10 brand new models within three years. XPeng said it also plans to enter more international markets.
"Looking beyond short-term challenges, XPeng is about to embark on a major product cycle," XPeng CEO He Xiaopeng said in Tuesday's earnings release.
Xpeng's expansion plans stand in stark contrast to EV rivals, which are racing to slash costs. This year, the China EV price war has intensified on both the high and low ends of the market.
Last month, XPeng announced a hiring and spending spree to survive what it describes as a "bloody sea" of EV competition.
Over the past weekend, the EV startup said it will launch a cheaper brand for global markets.
XPeng Stock
Shares of the Chinese EV maker gained 0.7% to 9.89 on the stock market today, reversing a drop to 9.27 in morning trade. XPeng stock tested a falling 50-day moving average intraday. It remains far below the 200-day line.
Li Auto and Nio slid further Tuesday. Li Auto sank nearly 12% Monday. Tesla also traded lower, while Warren Buffett-backed BYD edged higher.
All the China EV stocks and Tesla remain below their 200-day averages. Their 50-day lines lag below their 200-day lines, reflecting short-term weakness as well.
On Monday, various reports said Li Auto is looking to cut prices of its first purely battery electric vehicle, the Mega, to stimulate sales.
XPeng Expands Amid Price War
XPeng's February sales slid 45% vs. January. The month-over-month decline came amid the intensifying price war, Chinese New Year holiday and factory upgrades.
Chinese EV giant BYD is spearheading price cuts this year. Tesla began the China price war in late 2022.
"Many business partners are drawing back and afraid to invest," XPeng CEO He Xiaopeng wrote to employees last month, Reuters reported. "I think this is an opportunity for our development." He described 2024 as the first year of the "knockout round" for Chinese auto brands.
Both XPeng and Nio plan to launch lower-cost or mass-market brands. They seek to challenge BYD's dominance in the RMB 100,000 - RMB 150,000, local Chinese media reports say.
Earlier, Volkswagen partnered with XPeng to develop electric vehicles in China.
