Weichai Power Co., Ltd. (000338) released its Q3 2025 financial report, posting revenue of 170.6 billion yuan (+5% YoY) for the first three quarters, with net profit attributable to shareholders reaching 8.88 billion yuan (+6% YoY). Adjusted net profit stood at 7.97 billion yuan (+3% YoY).

**Q3 Revenue Meets Expectations** In Q3 2025, the company reported revenue of 57.4 billion yuan, up 16% YoY and 3% QoQ. This aligns with industry trends, as heavy-duty truck wholesale sales reached 282,000 units (+58% YoY, +3% QoQ). KION Group, a subsidiary, recorded stable revenue of 2.7 billion euros.

**Strong Growth in New Energy & Large-Bore Engines** From January to September, Weichai sold 536,000 engines, including 188,000 for heavy-duty trucks (117,000 diesel and 71,000 natural gas). Shaanxi Heavy-duty Auto sold 109,000 heavy-duty trucks (+18% YoY), while new energy heavy-duty truck sales surged 2.5x to 16,000 units. New energy powertrain revenue grew 84% YoY to 1.97 billion yuan. Large-bore M-series engine sales exceeded 7,700 units (+30% YoY), with data center applications seeing a 3x increase to over 900 units.

**Q3 Profit Exceeds Expectations on Scale Benefits** Q3 operating profit rose 43% YoY and 22% QoQ to 5.2 billion yuan, accounting for over 9% of revenue. Net profit reached 3.23 billion yuan (+29% YoY, +10% QoQ). Gross margin dipped slightly to 21.4% (-0.7pp YoY, -0.8pp QoQ), reflecting industry competition. However, operating expense ratios improved to 13.3% (-2.3pp YoY, -0.9pp QoQ), driven by cost optimization at KION and R&D efficiency.

**KION Contributes to Profit Growth** KION’s Q3 revenue remained flat at 2.7 billion euros, but a 34 million euro cost reversal boosted net profit to 120 million euros (+61% YoY, +26% QoQ).

**SOFC Expansion with Ceres Partnership** In November, Weichai signed a manufacturing license agreement with Ceres Power for solid oxide fuel cell (SOFC) production targeting AI data centers, commercial buildings, and industrial parks. This positions the company to benefit from rising global AI energy demand.

**Investment Considerations & Risks** Key risks include macroeconomic slowdowns, overseas demand weakness, unexpected natural gas price hikes, and delays in emission policy implementation.

*Disclaimer: This summary is based on the original research report and does not constitute investment advice.*