On August 19, Kandi's stock price surged 13.29%, adding to the previous day's gains for a cumulative two-day increase of 26.56%. This rally came as the company released its interim 2025 financial results on August 19.

For the first half of the year, Kandi reported revenue of $36.3 million, down 39.3% from $59.8 million in the same period of 2024. Net profit decreased 28.7% to $1.7 million from $2.4 million in the prior year period.

Why did Kandi's stock price surge despite declining performance? Behind this apparent contradiction lies the company's strategic transformation and management restructuring. The upgraded management team has been aggressively advancing new product development, marketing partnerships, sales network expansion, and brand building, ushering Kandi into comprehensive refined operations management.

During the first half, the company strategically focused on retail channel inventory management, resulting in a significant improvement in gross margin to 45.2%, up 13.5 percentage points from 31.7% in the same period of 2024.

While strengthening its core off-road vehicle business, the company has also partnered with YunShenChu for robotics business and successfully became a supplier for CATL's heavy-duty truck battery swapping stations, securing its first order. This marks the formation of the company's "One Core, Two Wings" strategy, gradually transforming from a manufacturing enterprise to a technology holding company.

As of the end of the first half, Kandi held $257 million in cash and cash equivalents, restricted cash, and time deposits, far exceeding the company's market capitalization and providing sufficient financial support for its transformation.

Renowned economist Song Qinghui stated that as Kandi's battery swapping equipment and robotics businesses grow, the company's valuation logic will shift from traditional manufacturing to intelligent equipment, with valuations expected to rise significantly.

**Strengthening Core Business**

Kandi's predecessor was Zhejiang Kandi Automobile Co., Ltd., established in 2002. Starting in 2006, Kandi began developing electric vehicles and successfully went public on NASDAQ in 2007. In 2013, Kandi formed a joint venture with Geely to establish an electric vehicle company, once becoming a leading company in the micro pure electric road vehicle industry. In 2021, Geely acquired Kandi's holdings.

"We have production bases in China and are a US-listed company with a mature sales system and local team in the United States, and the US is the largest market for off-road vehicles," recalled Dong Xueqin, Chairman of Kandi's Board of Directors. To find new development directions, Kandi held several meetings and ultimately decided to focus on producing pure electric off-road vehicles.

As a former road vehicle company, Kandi's entry into the off-road vehicle market represented a strategic advantage. In 2022, the first pure electric golf cart rolled off the production line, followed by continuous expansion into go-karts, beach buggies, utility vehicles, and other categories. Currently, the company's core products focus on golf carts (LSV/LTV) and electric all-terrain vehicles (UTVs).

Kandi's factories in Yongkang, Zhejiang and Xinyu, Jiangxi are responsible for producing lithium battery packs, motors, and other components, while facilities in Jinhua, Zhejiang and Haikou, Hainan handle golf cart and utility vehicle production. After assembly, vehicles are shipped via container to the United States for sale.

Due to the high cost of US domestic brand off-road vehicles and the inferior quality of some other Chinese manufacturers' products, Kandi's well-built, reasonably priced vehicles that are compatible with various charging stations, including Tesla Superchargers, have won favor among many American customers.

Beyond golf, many American customers have found new uses for golf carts as transportation vehicles, with Kandi-produced golf carts visible at supermarket entrances and residential areas across America.

To further advance Kandi's business development, on October 10 last year, the company announced that founder Hu Xiaoming resigned as Chairman while retaining his board position to provide decision-making support to the new management team. The board elected Dong Xueqin as the new Chairman.

Dong Xueqin brings extensive practical experience and expertise in automotive engineering and safety, holding multiple patents. Additionally, the company appointed Chen Feng as CEO, who has rich experience in electric vehicles and battery swapping.

The new management team proposed the "Three Seas Breakthrough" strategy - manufacturing overseas, intelligent manufacturing overseas, and ecosystem overseas. Kandi's implementation path is clear, having achieved supply chain localization, channel diversification, and brand scenario development.

Regarding supply chain localization, on May 1 this year, Kandi announced that its factory in Garland, Texas had officially commenced operations, with the first "Made in America" golf cart successfully rolling off the production line. The Garland factory covers approximately 4.56 acres with a total building area of 74,758 square feet, capable of producing Kandi's full range of electric off-road vehicles, including UTVs and other electric off-road recreational vehicles.

Chen Feng stated that the Garland factory's operation establishes a solid foundation for the company's continued growth and innovation in the US market. Notably, the company has previously announced partnerships with CBAK Energy Technology to build two lithium battery production facilities in the United States, continuing to expand its local manufacturing footprint.

In terms of channels, Kandi has successfully entered over 1,000 retail stores including Lowe's and Costco across North America, with its dealer network continuously expanding. For branding, Kandi partnered with home retail giant Lowe's to launch NFL-themed golf carts, covering fan bases of 32 football teams.

Through joint efforts of new and previous management teams, Kandi's off-road vehicle business achieved over $70 million in revenue in 2022, accounting for more than 60% of the company's total revenue of $118 million that year. By 2024, revenue from off-road vehicles and related parts sales increased 8.9% year-over-year to $117 million, representing over 91% of the company's total annual revenue of $128 million.

In the first half of this year, Kandi focused on retail channel inventory management, significantly improving gross margin to 45.2%, up 13.5 percentage points from 31.7% in the same period of 2024.

Notably, the electrification penetration rate in the North American off-road vehicle market is less than 20%, far from saturation, indicating enormous future growth potential for Kandi's business in this sector.

**Two Wings Taking Flight**

The off-road vehicle business represents the "One Core" in Kandi's "One Core, Two Wings" strategy. Previously, Chairman Dong Xueqin revealed in public interviews that Kandi has established a business architecture based on North American off-road mobility products as the foundation, with intelligent robotics and energy battery swapping equipment as the two wings.

The robotics business, one of the "two wings," launched on June 12 this year. Kandi announced partnerships with YunShenChu Technology, one of the "Hangzhou Six Dragons," for two collaborative projects: developing intelligent golf equipment and security patrol quadruped robot dogs for the North American market.

For intelligent golf equipment, Kandi is responsible for functional customization and channel promotion, while YunShenChu leads core technology development including path planning, navigation, and human-machine interaction. The collaborative golf intelligent equipment targets the high-end leisure consumer market, creating synergy with existing golf cart business. Both parties plan to pursue local production in North America when conditions mature.

For the security patrol quadruped robot dog project, Kandi provides system integration and large-scale production capabilities, while YunShenChu provides key perception and control technologies. The North American security market has an annual scale exceeding $10 billion, with urgent demand for intelligent patrol services due to high labor costs.

Kandi and YunShenChu Technology expect to capitalize on the rapid growth opportunities in North American and global service robotics markets through continuous iteration and localized promotion of these two major products, achieving sustainable growth and long-term value creation.

Beyond partnering with YunShenChu Technology, Kandi has also established a joint research institute with Zhejiang University, focusing on environmental perception and motion control algorithms to advance commercial applications of robotics technology.

Kandi's other "wing" is the battery swapping business. On August 12 this year, Kandi's wholly-owned subsidiary China Battery Swap (Zhejiang) Technology Co., Ltd. announced it had officially signed a "Framework Procurement Contract" with CATL, becoming a supplier of battery swapping station equipment for CATL.

On August 18, China Battery Swap announced it had successfully obtained its first heavy-duty commercial vehicle battery swapping station equipment order. This marks China Battery Swap's official entry into CATL's global supplier system, providing hardware support to jointly advance standardized battery swapping station construction.

Currently, the global battery swapping market is expanding at an annual compound growth rate exceeding 40%, with the future battery swapping industry expected to become a trillion-level market. Based on optimism about the battery swapping industry, Kandi entered battery swapping technology over a decade ago, and the company's new CEO Chen Feng has extensive experience in the battery swapping field.

Currently, Kandi's intelligent battery swapping system comprises 9 major modules including battery replacement, vehicle positioning, and electronic control management, featuring 6 major advantages: one-touch battery swapping, 90-second efficient swapping, automatic billing, and real-time monitoring.

Based on CATL's plan to build 500 battery swapping stations within the year and a long-term goal of over 10,000 stations, China Battery Swap's future equipment orders are expected to increase significantly. As CATL's overseas battery swapping station projects with Sinopec proceed smoothly, China Battery Swap also has the potential to "go global," exporting battery swapping equipment to more countries and regions, becoming another important growth engine for Kandi.

**Valuation Expected to Rise**

Many market participants view Kandi's transformation and upgrading as entering the fast track, transitioning from a traditional manufacturing enterprise to a technology holding platform company.

Initially, Kandi appears to have at least three major advantages: First, the synergy between battery swapping and robotics dual technologies allows for reusable R&D resources, with battery swapping technology simultaneously applicable to security robots. Second, existing North American sales channels can be used for new product promotion, with battery swapping equipment and security robots leveraging existing golf cart dealer teams for promotion, reducing market development costs while rapidly capturing market share. Third, policy benefits - as a multinational enterprise with factories in both China and the US, Kandi can obtain subsidies through US local production while utilizing China's supply chain for cost reduction.

Actively advancing its "One Core, Two Wings" strategy, Kandi's R&D expenses in the first half totaled $2.5 million, up 48.5% from $1.7 million in the same period of 2024, primarily due to current battery product development projects.

As the company's transformation deepens, can Kandi's finances support this transition? CEO Chen Feng sees no problem. In the "2025 Interim Financial Report - Management Commentary," Chen Feng revealed that as of June 30, 2025, the company held $257 million in cash and cash equivalents, restricted cash, and certificates of deposit, maintaining robust financial health and providing sufficient financial support for future growth and business expansion.

Market valuation of Kandi remains modest, with a current market capitalization of $139 million, far below its cash holdings. In Song Qinghui's view, Kandi's substantial cash position can support the company's strategic transformation. As revenue from battery swapping and robotics increases, the market will recognize the company as a technology enterprise, with valuations potentially enjoying 15 times or even higher PE ratios. At that point, Kandi's market capitalization will rise significantly.

Currently, Kandi's stock price has frequently shown volatility due to its transformation. On August 12, Kandi's stock price surged as much as 21.7% intraday, ultimately closing at $1.31, up 13.91%, with trading volume increasing 7,021.62% compared to August 11. This movement stemmed from morning news that Kandi's subsidiary China Battery Swap had officially signed a battery swapping station equipment supply contract with CATL.

On August 18, when the company announced securing CATL's first heavy-duty truck battery swapping station equipment order, Kandi's stock price again showed volatility, surging as much as 15.63% intraday and ultimately closing at $1.43, up 11.72%.

On August 19, Kandi's stock price closed at $1.62, surging another 13.29%. Since August 12, Kandi's stock price has cumulatively risen 40.87%.

What additional achievements will Kandi's "One Core, Two Wings" strategy deliver in the future? Continued attention is warranted.