XPeng's Earnings Have a Lot to Like. That's Good News for Weary EV Investors. -- Barrons.com
DOW JONES & COMPANY, INC. 8:44 AM ET 5/13/2021
Symbol Last Price Change
XPEV 23.67down -1.09 (-4.4023%)
QUOTES AS OF 12:20:24 PM ET 05/13/2021
The Chinese electric-vehicle maker XPeng's(XPEV) quarterly earnings report offered a jolt of good news for weary EV investors, sending the stock almost 4% higher in premarket trading even as the broader market wavered.
Futures on the S&P 500 were flat, while those on the Dow Jones Industrial Average were lower.
The company reported a loss of 13 cents per American depositary receipt, or ADR. from $450 million in sales. Wall Street was projecting a loss of about 20 cents from about $415 million in sales. Each ADR in XPeng(XPEV) represents two common shares, which makes tracking per-share estimates of sales and earnings a little tricky.
"The first quarter kicked off a great start to 2021 with a record-breaking vehicle deliveries notwithstanding seasonally slower demand for automobiles and the semiconductor shortage," said CEO He Xiaopeng in the company's news release. "Our strong momentum in the quarter was propelled by our industry-leading full-stack autonomous driving technology."
The news on XPeng's(XPEV) efforts with autonomous driving was also positive. The company has been releasing new versions of its driver-assistance software, called XPILOT, and XPeng(XPEV) President Brian Gu told Barron's that 20% to 25% of new vehicles are being sold with subscriptions to its autonomous-driving software. That is a healthy level of demand for a new feature.
XPeng (XPEV) also began to offer a lower-cost, lower-range iron-phosphate rechargeable battery in April. Gu said about 15% of new orders are for the lower-priced batteries.
Gu also says the order book is as strong as it has ever been. The company is predicting sales of 15,500 to 16,000 vehicles for the second quarter. That is up from about 13,300 in the first quarter and about 3% to 5% above analysts' projections. The quarter to quarter increase is despite the semiconductor shortage that is constraining car production around the globe.
Investors needed the good news. All EV stocks have been struggling as inflation fears grow and highly valued, high- growth technology shares sell off. XPeng(XPEV) stock is down 67% from its 52-week high, while the Nasdaq Composite Index, home to many tech stocks, is down 8.3% from its 52-week high and has dropped eight of the past 10 trading sessions.
XPeng (XPEV) management scheduled a conference call for 8 a.m. on the East Coast to discuss the results. Investors and analysts will be eager to hear updates about new products as well as the semiconductor shortage.
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