Guosen Securities has issued a research report maintaining its revenue forecast for XPENG-W (09868), projecting revenues of 100/130/150 billion yuan for 2026/2027/2028. However, considering factors such as rising raw material costs for storage chips and increased R&D expenditures related to new vehicle models and AI technology development, the firm has revised its profit forecast downward. It now expects net profit attributable to the parent company to be -1.0/2.0/3.6 billion yuan for 2026/2027/2028 (compared to previous estimates of 0.8/3.0/4.5 billion yuan). The "Outperform" rating is maintained.

Key Financial Performance for Q1 2026

In the first quarter of 2026, XPENG-W reported deliveries of 63,000 vehicles, representing a year-on-year decrease of 33.3% and a quarter-on-quarter decrease of 46.1%. Total revenue reached 13.03 billion yuan, down 17.6% year-on-year and 41.4% quarter-on-quarter. The net loss was -1.78 billion yuan, compared to a loss of -0.66 billion yuan in the same period last year and a profit of 0.38 billion yuan in Q4 2025.

Automobile sales revenue for Q1 2026 was 11.0 billion yuan, down 23.5% year-on-year and 42.3% quarter-on-quarter, primarily due to lower vehicle deliveries. Service and other revenue amounted to 2.03 billion yuan, up 41.2% year-on-year but down 36.1% quarter-on-quarter. The year-on-year growth in this segment was mainly driven by increased revenue from technology R&D services and sales of parts and accessories.

Profitability and Expense Metrics

The company's gross profit margin and net profit margin for Q1 2026 were 20.6% and -13.7%, respectively. This represents a year-on-year increase of 5.0 percentage points in gross margin and a decrease of 9.5 percentage points in net margin. Compared to the previous quarter, gross margin decreased by 0.7 percentage points while net margin decreased by 15.4 percentage points. The R&D expense ratio and the SG&A expense ratio were 22.3% and 14.5%, respectively, showing significant increases both year-on-year and quarter-on-quarter.

The year-on-year improvement in gross margin can be broken down as follows: the automobile business gross margin was 12.1%, up 1.6 percentage points year-on-year but down 0.9 percentage points quarter-on-quarter. The service and other business profit margin was 66.5%, slightly up 0.1 percentage points year-on-year but down 4.3 percentage points quarter-on-quarter.

Deliveries and Outlook

Vehicle deliveries for Q1 2026 totaled 63,000 units, down 33.3% year-on-year and 46.1% quarter-on-quarter. The company's guidance for Q2 2026 projects vehicle deliveries between 100,000 and 106,000 units, representing an approximate year-on-year change of -3.1% to +2.7% and a sequential increase of about 59.5% to 69.1%.

Launch of New Flagship Model

On May 20, 2026, XPENG Group launched its new technology flagship SUV, the GX. Positioned as a new tech flagship for the physical AI era, the GX is the group's first full-size SUV of its kind. It offers both pure electric and super-range extended powertrain options, with a limited-time introductory price starting from 269,800 yuan.

The new vehicle integrates several of the group's cutting-edge technologies, combining autonomous driving technology derived from Robotaxi, safety redundancy technology from flying cars, and chip and architecture technology for embodied intelligence. It aims to address seven core industry pain points: ease of driving for a large vehicle, high-quality yet understated interior, exhilarating performance, safety, low energy consumption, high intelligence, and ample space. The GX offers product capabilities surpassing those of vehicles in the 500,000-yuan-plus segment and comes standard with over a hundred leading technologies typically found in that price range, providing a high-end mobility choice that balances technology, practicality, and quality for users who value life, family, and technology.

Risk Factors

Potential risks include rising raw material prices and intensifying price competition in the automotive market.