Leapmotor's first-quarter revenue grew by 8%, overseas sales surged by 442% year-on-year, but losses widened | Earnings Report Highlights

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Leapmotor announced its unaudited results for Q1 2026: revenue grew year-on-year but net loss widened, with gross margin plunging by more than 5 percentage points compared to last year, becoming the core pressure point for this quarter’s performance.

Revenue for the quarter reached RMB 10.82 billion, up 8.0% year-on-year, hitting a new historical high for the first quarter. However, net loss widened from RMB 130 million in the same period last year to RMB 390 million, turning from last quarter’s profit of RMB 360 million into a loss.

Gross margin dropped to 9.4%, sharply down from 14.9% a year ago and 15.0% last quarter, mainly due to changes in vehicle product mix and reduced strategic cooperation business. Net cash from operating activities was negative RMB 6.61 billion, free cash flow was negative RMB 7.40 billion, indicating significantly intensified cash consumption.

Despite pressure on profitability metrics, Leapmotor’s Q1 sales reached 110,155 units, up 25.8% year-on-year, with overseas sales hitting a record 40,901 units, accounting for over 30% of total sales. April sales further surged to 71,387 units, up 73.9% year-on-year, setting a new monthly sales record for the brand and ranking first among new energy brands in monthly sales.

Regarding new models, Leapmotor A10’s daily production exceeded 1,000 units in the first month; Leapmotor D19 surpassed 15,000 confirmed orders within 15 days of launch.

Gross margin declines, net loss widens

Leapmotor’s gross margin for Q1 was 9.4%, down 5.5 percentage points from 14.9% a year ago, and down 5.6 percentage points from 15.0% last quarter. The company attributed this decline to two factors: First, changes in vehicle product mix with a higher proportion of lower-priced models lowering the average selling price; second, reduced income from strategic cooperation business.

Cost of sales was RMB 9.80 billion, up 14.9% year-on-year, growing faster than revenue and indicating narrower per-unit profit margins. The company stated that ongoing cost management partially offset the negative impact of product mix changes, but not entirely.

Operating loss widened from RMB 150 million last year to RMB 410 million. Net loss attributable to shareholders was RMB 390 million, due to declining gross profit and increased R&D, sales, and administrative expenses. R&D expenses increased by 30.0% year-on-year to RMB 1.04 billion, showing the company’s sustained high investment in technology.

Record sales, particularly strong overseas growth

While profitability metrics were under pressure, Leapmotor’s expansion momentum did not slow. Q1 total sales grew 25.8% year-on-year, with overseas sales up 442.0%, jumping from 7,546 units last year to 40,901 units, making up 37.1% of the total.

The European market performed especially well.

Leapmotor registered 23,300 vehicles in 16 European countries in Q1, up 726.5% year-on-year; in 12 EU countries, pure electric vehicle sales reached about 17,000 units, ranking first among Chinese pure electric brands. In Italy, 11,637 units were registered in Q1; in Germany, March sales hit 1,258 units, both ranking first among Chinese pure electric brands locally.

By the end of March, Leapmotor International, established in partnership with Stellantis Group, had built about 1,000 sales and after-sales outlets in over 40 markets across Europe, Middle East, Africa, and Asia-Pacific, with over 850 in Europe. Overseas sales in April reached 14,225 units, accounting for 19.9% of the month’s total sales.

Frequent launches of new models, product matrix expands towards high-end

Since Q1, Leapmotor has accelerated the pace of new product launches, covering various market segments from under RMB 100,000 to RMB 300,000.

The A10, launched on March 26 as a smart SUV under RMB 100,000, received over 10,000 orders in 48 hours, and achieved over 40,000 confirmed orders in its first month. The company stated that A10 brings lidar and point-to-point navigation assistance to the under RMB 100,000 price point, emphasizing "tech for all."

The D19, launched on April 16, is the first model from Leapmotor’s flagship D platform, priced from RMB 219,800 to RMB 269,800. The company stated that D19 achieved more than 15,000 confirmed orders in 15 days.

This model features Leapmotor’s latest LEAP 4.0 central domain architecture, dual Qualcomm 8797 chips with computing power of 1,280 TOPS, paired with the VLA assisted driving large model. The range-extended version is equipped with an 80.3 kWh battery, with pure electric range over 500 km; the pure electric version uses 115 kWh CATL super hybrid battery cells, offering a range of 720 km.

Additionally, flagship MPV Leapmotor D99 is planned to start pre-sale in June and launch/deliver in July, positioned for the RMB 300,000 market; Lafa5 Ultra was launched at the Beijing Auto Show on April 24 as a top configuration coupe under RMB 150,000, with city navigation-assisted driving available upon delivery.

Full-stack self-developed technology, intelligent driving across all models

Leapmotor emphasized its "full-stack self-developed" technology route this quarter. The LEAP 4.0 architecture, first adopted in D19, centers on dual 8797 chips, enabling two-way data communication between the cockpit and intelligent driving systems, and supports dynamic allocation of computing power between entertainment and assisted driving scenarios.

The company stated that by 2026, the C and B series annual models will fully feature city navigation-assisted functions. Models with LEAP 3.0 and 3.5 architectures will also gradually be upgraded, with the goal of achieving assisted driving coverage from the RMB 100,000 level A10 to the flagship D19.

In ESG, the company received an MSCI ESG AA rating for the third consecutive year this quarter, EcoVadis rating upgraded from bronze to silver, and overall ranking improved from the top 35% of global participating companies to the top 15%.

Ample cash reserves, but cash consumption worth noting

By the end of March, Leapmotor’s cash and related assets totaled RMB 30.63 billion. While liquidity remains ample on the books, cash consumption increased significantly this quarter.

Net cash from operating activities was negative RMB 6.61 billion, compared to positive RMB 340 million a year ago and positive RMB 4.89 billion last quarter; free cash flow was negative RMB 7.40 billion, turning sharply negative year-on-year and quarter-on-quarter.

The company attributed these changes to payment terms leading to increased payables due, as well as seasonal factors causing a drop in deliveries.

Leapmotor stated that as of the announcement date, cumulative deliveries exceeded 1.3 million units. In 2025, the company achieved full-year profitability, becoming the second Chinese new energy automaker to do so. This quarter’s financial figures have not yet been audited and final numbers may be subject to adjustment.

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