Leapmotor (4Q25 Trans): 2026 sales target unchanged at 1mn units ---
The following is Dolphin Research's transcript of Leapmotor's FY2025 earnings call. For the earnings take, see 'Leapmotor: Overseas hero model — can it truly 'lead' new EV makers to 1mn units?'.
I. Key takeaways
1. Profit guide: 2026 net profit target of RMB 5bn unchanged; 2026 volume target of 1mn units (incl. 100–150k overseas) unchanged.
2. GPM: FY2025 blended GPM 14.5% (+610bps YoY). Q4 GPM 15% (vehicle ~12%, others ~3%), a single-quarter high. GPM is expected to dip QoQ in Q1 on seasonal volume softness.
3. Profit inflection: FY2025 swung to profit with net income of RMB 540mn.
4. Cash flow and cash: Operating cash flow exceeded RMB 12bn (+RMB 4.15bn YoY). FCF was RMB 7.8bn (+RMB 1.5bn YoY). Cash and equivalents at period-end were RMB 37.88bn (+50.9% YoY).
5. Financing and capital moves: Completed a private placement of RMB 2.6bn in Aug 2025, issuing 17mn new shares. In Jan 2026, Jinhua Jinxin Gaoke invested RMB 3bn.
II. Earnings call details
2.1 Management remarks
1. Volume and market position
a. Delivered 596,905 units in FY2025, up 103% YoY, doubling for a second straight year, ranking No.1 among China’s new EV makers. b. Monthly sales topped 70k units, the only new EV maker at this level. c. Exports exceeded 100k units, No.1 among BEV newcomers; ranked No.2 in passenger-car exports in Q4. d. Cumulative deliveries surpassed 1.2mn units by Dec 31, 2025.
2. Product lineup
a. B series: B10 (launched Apr 2025 on LEAP 3.5 with Qualcomm 8650, E2E large model, IROS 4.0; monthly sales >10k for four consecutive months), B11 (100k+ units in 11 months), Lafa5 (high-end sports sedan launched Nov 27, 2025; >20k units in three months; to go global in Q2 2026). b. C series: C10 surpassed 200k units in 18 months on market, with top-tier NPS. c. D series: Flagship V19 (global debut Oct 2025; benchmark at ~RMB 300k), D99 (luxury MPV launched Dec 28, 2025). d. A series: A10 (unveiled at the Nov 2025 Guangzhou Auto Show; to launch Mar 26, 2026; 500km range with 8295 smart SoC). e. Cumulative B-series sales approached 200k units by Feb.
3. R&D
a. LEAP 3.5 architecture: Qualcomm SoCs with highly centralized domain control integrating chassis, battery, and thermal systems. b. D-platform EREV: 115kWh Kirin 3 pack, 500km EV-only range, AA 8797 chip (1,280 TOPS), LMC2.0 chassis. c. ADAS/AD: City NOA has rolled out on B/C series; widening to BC series in Feb 2026, nationwide city coverage in Q2, with a base autonomy model by year-end. d. Three e-drive breakthroughs: torque vectoring (0.5ms response), next-gen hybrid e-drive system, and a full-hybrid transmission now in validation. e. Battery: advanced battery-to-chassis integration completed ahead of plan; fast-charge and semi-solid technologies; SGS and TOA safety certifications obtained.
4. Sales network
a. By end-2025, coverage expanded to 259 cities (+31 YoY) with 950 sales stores and 256 service outlets. b. The Seed program served 205 stores, driving per-store output +85.1% YoY. c. After-sales NPS was 46, up 74% QoQ.
5. Overseas
a. Leapmotor Intl has built out in the Middle East and South America, with 900+ sales/service points globally (800+ Europe, 50+ APAC, 30+ South America). b. The Spain plant is underway, with B10 and B05 as focus models; battery-pack SOP in Sep 2026 and vehicle SOP in Jun 2027. c. Entered South America in Oct 2025, with 30+ stores in Brazil. d. A10 made its global debut at the Brussels Motor Show in Jan 2026. e. Deeper tie-up with Stellantis, with some projects in late-stage talks; Leapmotor Intl turned profitable in 2025.
6. Strategic partnerships
a. FAW Group: signed a strategic pact in Mar 2025 to co-develop NEV passenger cars, with the first model progressing; FAW invested in Leapmotor in Dec 2025. b. Jinhua Jinxin Gaoke: subscribed RMB 3bn in Jan 2026.
7. ESG
a. Received MSCI ESG's highest rating for three consecutive years. b. Intl rating upgraded from Bronze to Silver, with ranking improving from top 35% to top 15%. c. Approved as a national-level green factory.
2.2 Q&A
Q: How will higher raw material prices affect GPM?
A: We note price increases in basic materials and lithium carbonate. We will tighten cost control, with a focus on higher in-house R&D and manufacturing. In 2025, batteries, e-motors, compressors, power and thermal systems were brought in-house, and high value-added parts like seats and bumpers were also self-developed and produced.
We view raw material swings as cyclical, with several up/down cycles in recent years, and do not expect a one-way rise to persist. Given the above, the impact on GPM should be limited. We expect to fully offset raw-material inflation through cost control in 2026, with no material hit to operating income.
Q: What is the breakdown and sustainability of the RMB 2.72bn in services and other revenue?
A: This mainly includes carbon credit revenue from overseas markets, licensing income from partners, and export-related income (e.g., intl logistics premia).
On sustainability: as exports to Europe rise, per-vehicle carbon credit value may be slightly lower in 2026 vs. 2025, but volume growth should more than offset, so carbon credit revenue is expected to grow YoY.
For licensing, projects with Stellantis are in very critical negotiation stages, and multiple collaborations are moving forward. Domestically, the first model with FAW is progressing well, and we are discussing further cooperation, with full alignment at the management level. We expect domestic and overseas partners to continue contributing revenue this year, and we are optimistic on positive updates.
Q: For overseas, what is the split between Spain-local production and exports? How do you manage shipping costs? Any plan to localize cell procurement?
A: In Spain, B10 will start local production in Oct 2026, currently the only model localized in Europe. Localized volume will be about one-quarter of B10's European sales, with the rest exported from China.
Strategically, localization is the inevitable path for Chinese EV makers going global, and we are planning capacity not only in Spain but also in other continents. On logistics, the key bottleneck from geopolitics is capacity rather than freight rates. We have not seen a clear rise in shipping costs yet, but we are closely monitoring. Any increase would be an industry-wide issue, not unique to Leapmotor.
On cells, the Spain facility is a C2C battery-pack assembly plant, initially sourcing cells from China. We are in active discussions with cell suppliers on localization, as cell makers globalize capacity. Our plan will balance suppliers' overseas capacity ramp and new EU rules, and we will accelerate localization once conditions allow.
Q: Can Leapmotor or Leapmotor Intl apply for a minimum selling price to be exempt from additional tariffs?
A: Europe exports are handled through Leapmotor Intl, and tariffs are borne by the JV. We, Leapmotor Intl, and Stellantis are closely tracking the evolving European regulatory framework and analyzing all new rules. We will pursue any path that benefits our European biz. Our partner has strong on-the-ground expertise and information channels in Europe, so we are working closely, and will apply proactively once our models meet the criteria.
Q: What is the concrete impact of raw-material swings on Q1 and Q2? How were Q4 and Q1 GPM? Why were Q4 selling expenses higher, and what is the FY guide?
A: Raw-material price changes take time to flow through OEMs and do not show up immediately. We have been optimizing costs since last year and will add further measures, and we do not expect a major GPM impact at least in H1.
Q4 GPM was 15% (vehicle ~12%, others ~3%). For Q1, with sales down sharply vs. Q4, GPM will also retreat.
On selling expenses, Q4 is a peak sales season, and we invested to secure volume and market share. Total marketing spend in 2026 will exceed 2025 in absolute terms as volume and brand grow, but selling expense per vehicle will decline vs. 2025.
Q: What are the plans to expand the overseas sales network in 2026?
A: In Europe, from 800+ stores in 2025, we will keep expanding in underpenetrated countries in 2026. South America will be a key focus for Leapmotor and Leapmotor Intl in 2026, with significant expansion in share and network. In APAC, we will digest 2025 learnings, fix gaps, optimize the network, and lift store count further.
Q: What are the 2026 domestic and overseas volume targets? Which South American countries and models are priorities?
A: Volume guide remains 1mn units this year, with 100–150k overseas. We expect China's passenger-car market to be broadly stable vs. 2025, with NEV penetration continuing to rise. We are constructive on domestic demand; soft demand in Jan–Feb is cyclical and should release in later months. We are confident in meeting the 2026 target and see no need to adjust.
In South America, we are prioritizing Brazil, Chile, Argentina, Ecuador, and Colombia, with Brazil the largest and top priority. C10 and B10 have launched in the region, and more models were showcased at the São Paulo Auto Show. We are coordinating with the Stellantis South America team to bring models tailored to local needs.
Q: What is the launch timetable for the four new models in 2026? And how to interpret the 'scenario-based innovation' mentioned by Mr. Zhu?
A: Launch cadence in 2026: A10 on Mar 26 (test-drive cars already in stores); D19 in late Apr; A05 and D99 in mid/late Jun to early Jul.
On scenario-based innovation, this involves highly confidential elements of our new-product development and is not suitable for detailed disclosure now.
Q: What is the 2026 profit guide?
A: As guided in 2025, our 2026 net profit target remains RMB 5bn, with no change this year.
Q: Is autonomous driving self-developed or supplier-led?
A: We see this year as pivotal for Leapmotor's AD breakthroughs. From H2 2024 through 2025, we significantly ramped talent, technology, and capital on AD, and progress is rapid, with investor ride-and-drives planned this year. We aim for Leapmotor AD to be recognized as first-tier by end-2026.
Full-stack in-house development is our AD strategy and a firm commitment. We do engage partners during R&D, but that will not alter the full-stack in-house path.
Q: What is the 2026 overseas profit guide? Has higher oil in Europe accelerated NEV adoption? What about 2026 R&D spend?
A: On overseas profit, we have reiterated that the first 2–4 years of going global are investment years, with shareholders on both sides supporting Leapmotor Intl's rapid scale-up. 2026 is its second full year, and we will prioritize share gains in Europe, South America, and APAC over profit, so there is no profitability target for 2026.
On European NEV penetration, outcomes hinge on the macro backdrop. If the current geopolitical tensions persist and oil/gas supply worsens with higher prices, NEV adoption will accelerate. Beyond Middle East conflicts, the Russia-Ukraine war has materially impacted Europe's oil/gas supply. Even absent war, NEV growth in Europe has been outperforming many experts' expectations, and our sales have been strong with solid consumer reception.
R&D expenses will rise meaningfully in 2026 vs. 2025, driven by accelerated investment in new technologies, new models, and talent.
Q: How is parts export progressing? What was carbon credit revenue in 2025?
A: As models ramp to mass production, many parts-export projects will start in H2 2026. There will be export revenue in 2026 but small (likely under RMB 1bn), with the main growth in 2027.
Carbon credit revenue was about RMB 1bn in 2025.
Q: What is current inventory? How is the 1mn target split by series?
A: On inventory, we started deliberate destocking from Dec 2025. FY2025 sales were 596k units, slightly below some 600k expectations. Given a softer Q1, we began managing dealer inventory at end-2025. This trend materialized in Jan–Feb and will continue.
Based on the last eight weeks' sales, total inventory stands at roughly 1.5–2 months. But Jan–Feb volatility makes that less representative, so we are refining against Mar–Apr estimates. On Mar run-rate, network inventory is around one month or less; normal months should be 0.8–1.2 months, which we achieved for most of 2025.
On mix, of the 1mn target, ~600k are new models and ~400k are existing models, an approx. 60:40 split. This is preliminary and will be fine-tuned with market conditions.
Q: Progress and expected revenue from the FAW co-developed model?
A: The first FAW model will start production in Q3 (around Sep). Leapmotor leads R&D and manufacturing, and sales will be overseas. Given sales cycles, launch is expected by end-2026, so revenue impact in 2026 may be limited.
<End here>
Risk disclosure and disclaimer:Dolphin Research disclaimer and general disclosure
