Li Auto Inc. Announces Unaudited Second Quarter 2023 Financial Results

Rhea-AI Summary

Li Auto Inc. announced its unaudited financial results for the quarter ended June 30, 2023. Total revenues reached RMB28.65 billion ($3.95 billion), representing a 228.1% YoY increase. Quarterly deliveries reached 86,533 vehicles, a 201.6% YoY increase. Vehicle sales were RMB27.97 billion ($3.86 billion), a 229.7% YoY increase. Gross profit was RMB6.24 billion ($859.9 million), a 232.0% YoY increase. Net income was RMB2.31 billion ($318.6 million), a 147.4% YoY increase.

Positive

• Total revenues reached RMB28.65 billion ($3.95 billion), representing a 228.1% YoY increase.
• Quarterly deliveries reached 86,533 vehicles, a 201.6% YoY increase.
• Vehicle sales were RMB27.97 billion ($3.86 billion), a 229.7% YoY increase.
• Gross profit was RMB6.24 billion ($859.9 million), a 232.0% YoY increase.
• Net income was RMB2.31 billion ($318.6 million), a 147.4% YoY increase.

Negative

• None.

Quarterly total revenues reached RMB28.65 billion (US$3.95 billion)¹
Quarterly deliveries reached 86,533 vehicles

BEIJING, China, Aug. 08, 2023 (GLOBE NEWSWIRE) --  Li Auto Inc. (“Li Auto” or the “Company”) (Nasdaq: LI; HKEX: 2015), a leader in China’s new energy vehicle market, today announced its unaudited financial results for the quarter ended June 30, 2023.

Operating Highlights for the Second Quarter of 2023

• Total vehicle deliveries were 86,533 units in the second quarter of 2023, representing a 201.6% year-over-year increase.
  
  

Deliveries		2023 Q2		2023 Q1		2022 Q4		2022 Q3
		86,533		52,584		46,319		26,524
Deliveries		2022 Q2		2022 Q1		2021 Q4		2021 Q3
		28,687		31,716		35,221		25,116

• As of June 30, 2023, the Company had 331 retail stores covering 127 cities, as well as 323 servicing centers and Li Auto-authorized body and paint shops operating in 223 cities.

Financial Highlights for the Second Quarter of 2023

• Vehicle sales were RMB27.97 billion (US$3.86 billion) in the second quarter of 2023, representing an increase of 229.7% from RMB8.48 billion in the second quarter of 2022 and an increase of 52.6% from RMB18.33 billion in the first quarter of 2023.
  
  
• Vehicle margin² was 21.0% in the second quarter of 2023, compared with 21.2% in the second quarter of 2022 and 19.8% in the first quarter of 2023.
  
  
• Total revenues were RMB28.65 billion (US$3.95 billion) in the second quarter of 2023, representing an increase of 228.1% from RMB8.73 billion in the second quarter of 2022 and an increase of 52.5% from RMB18.79 billion in the first quarter of 2023.
  
  
• Gross profit was RMB6.24 billion (US$859.9 million) in the second quarter of 2023, representing an increase of 232.0% from RMB1.88 billion in the second quarter of 2022 and an increase of 62.8% from RMB3.83 billion in the first quarter of 2023.
  
  
• Gross margin was 21.8% in the second quarter of 2023, compared with 21.5% in the second quarter of 2022 and 20.4% in the first quarter of 2023.

• Income from operations was RMB1.63 billion (US$224.2 million) in the second quarter of 2023, compared with RMB978.5 million loss from operations in the second quarter of 2022 and representing an increase of 301.3% from RMB405.2 million income from operations in the first quarter of 2023. Non-GAAP income from operations³ was RMB2.04 billion (US$281.8 million) in the second quarter of 2023, compared with RMB520.8 million non-GAAP loss from operations in the second quarter of 2022 and representing an increase of 130.8% from RMB885.4 million non-GAAP income from operations in the first quarter of 2023.
  
  
• Net income was RMB2.31 billion (US$318.6 million) in the second quarter of 2023, compared with RMB641.0 million net loss in the second quarter of 2022 and representing an increase of 147.4% from RMB933.8 million net income in the first quarter of 2023. Non-GAAP net income³ was RMB2.73 billion (US$376.1 million) in the second quarter of 2023, compared with RMB183.4 million non-GAAP net loss in the second quarter of 2022 and an increase of 92.9% from RMB1.41 billion non-GAAP net income in the first quarter of 2023.
  
  
• Net cash provided by operating activities was RMB11.11 billion (US$1.53 billion) in the second quarter of 2023, compared with RMB1.13 billion net cash provided by operating activities in the second quarter of 2022 and an increase of 42.8% from RMB7.78 billion net cash provided by operating activities in the first quarter of 2023.
  
  
• Free cash flow⁴ was RMB9.62 billion (US$1.33 billion) in the second quarter of 2023, compared with RMB451.7 million free cash flow in the second quarter of 2022 and representing an increase of 43.6% from RMB6.70 billion free cash flow in the first quarter of 2023.

Key Financial Results (in millions, except for percentages)
	For the Three Months Ended							% Change5
	June 30, 2022		March 31, 2023		June 30, 2023				YoY		QoQ
	RMB		RMB		RMB
Vehicle sales	8,483.6		18,327.3		27,971.9				229.7%		52.6%
Vehicle margin	21.2%		19.8%		21.0%				(0.2)%		1.2%
Total revenues	8,732.6		18,787.1		28,652.7				228.1%		52.5%
Gross profit	1,878.3		3,830.1		6,235.3				232.0%		62.8%
Gross margin	21.5%		20.4%		21.8%				0.3%		1.4%
(Loss)/income from operations	(978.5)		405.2		1,625.9				N/A		301.3%
Non-GAAP (loss)/income from operations	(520.8)		885.4		2,043.3				N/A		130.8%
Net (loss)/income	(641.0)		933.8		2,310.1				N/A		147.4%
Non-GAAP net (loss)/income	(183.4)		1,414.1		2,727.5				N/A		92.9%
Operating cash flow	1,129.4		7,780.4		11,112.4				N/A		42.8%
Free cash flow (non-GAAP)	451.7		6,702.1		9,621.4				N/A		43.6%

Recent Developments

Delivery Update

• In July 2023, the Company delivered 34,134 vehicles, representing an increase of 227.5% from July 2022. As of July 31, 2023, the Company had 337 retail stores covering 128 cities, in addition to 323 servicing centers and Li Auto-authorized body and paint shops operating in 222 cities.
  

Family Tech Day

• On June 17, 2023, the Company hosted a Family Tech Day where it announced its plan to unveil its super flagship 5C BEV model, Li MEGA, by the end of 2023, and presented the optimization of battery cells and thermal management system as well as its 5C super charging network deployment to enable 5C charging capability. The Company also showcased its technological advancements for smart space and autonomous driving, and introduced its roll-out plans for city NOA and commute NOA. Both city NOA and commute NOA were launched for test drives in June 2023, and are expected to be released to 100 cities nationwide by the end of 2023.
  

Li L9 Pro

• On August 3, 2023, the Company launched the Pro trim of Li L9 to cater to a wider range of family users. Li L9 Pro comes standard with the Li AD Pro autonomous driving system powered by a Horizon Robotics Journey 5 chip and the SS Max+ smart space system. The retail price for Li L9 Pro is RMB429,800.
  

At-The-Market Offering

• On June 28, 2022, the Company announced an at-the-market offering program (the “ATM Offering”) to sell up to US$2,000,000,000 of American depositary shares (“ADSs”), each representing two Class A ordinary shares of the Company.
  
  As of the date of this press release, the Company has sold 9,480,014 ADSs representing 18,960,028 Class A ordinary shares of the Company under the ATM Offering, raising gross proceeds of US$368.3 million before deducting fees and commissions payable to the distribution agents of up to US$4.8 million and certain other offering expenses.

CEO and CFO Comments

Mr. Xiang Li, chairman and chief executive officer of Li Auto, commented, “We crossed the 30,000 monthly delivery milestone in June, closing the second quarter with an all-time high vehicle delivery, while all of the three Li L series models maintained sales leadership in their respective categories. These accomplishments solidified our standing as the preferred premium brand for families, firmly positioning us to achieve the revenue target of RMB100 billion in 2023. Facing the competitive market dynamics in China’s NEV industry, in the second quarter we achieved our highest-ever profitability while continuing to strengthen our competitive advantage through ongoing investments in research and development and business expansion, as well as improvements in our organizational processes and operational capabilities.”

“In June, we launched China’s first city NOA and commute NOA independent of high-definition maps for test drives, showcasing their outstanding abilities to perceive, plan, and control in complex urban traffic environments. Furthermore, our super flagship 5C BEV model, Li MEGA, is scheduled to be unveiled in the fourth quarter of this year. Embodying our latest technological advancements in electrification and intelligentization, we are confident that Li MEGA will become a new sales blockbuster in the RMB500,000 and higher price segment. As a growth-driven organization, we will relentlessly explore and train ourselves to achieve further developments while building products and services that exceed user needs.”

Mr. Tie Li, chief financial officer of Li Auto, added, “We had a strong showing in the second quarter, setting new records across revenue, net income, and free cash flow. Specifically, we grew our revenue by 228.1% year-over-year to RMB28.65 billion, fueled by the significant increase in vehicle deliveries. We achieved net income of RMB2.31 billion while recording free cash flow of RMB9.62 billion. The robust financial performance empowers the Company to deepen its commitment to research and development and accelerate business expansion as we strive to deliver greater value to our users, shareholders and society as a whole.”

Financial Results for the Second Quarter of 2023

Revenues

• Total revenues were RMB28.65 billion (US$3.95 billion) in the second quarter of 2023, representing an increase of 228.1% from RMB8.73 billion in the second quarter of 2022 and an increase of 52.5% from RMB18.79 billion in the first quarter of 2023.
  
  
• Vehicle sales were RMB27.97 billion (US$3.86 billion) in the second quarter of 2023, representing an increase of 229.7% from RMB8.48 billion in the second quarter of 2022. The increase in vehicle sales over the second quarter of 2022 was mainly attributable to the increase in vehicle deliveries. The increase of 52.6% from RMB18.33 billion in the first quarter of 2023 was mainly attributable to the increase in vehicle deliveries, partially offset by the lower average selling price due to different product mix between two quarters.
  
  
• Other sales and services were RMB680.8 million (US$93.9 million) in the second quarter of 2023, representing an increase of 173.4% from RMB249.0 million in the second quarter of 2022 and an increase of 48.1% from RMB459.7 million in the first quarter of 2023. The increase in revenue from other sales and services over the second quarter of 2022 and the first quarter of 2023 was mainly attributable to the increased sales of accessories and provision of services, which is in line with higher accumulated vehicle sales, and the increased sales of charging stalls, which is in line with higher vehicle deliveries.
  

Cost of Sales and Gross Margin

• Cost of sales was RMB22.42 billion (US$3.09 billion) in the second quarter of 2023, representing an increase of 227.1% from RMB6.85 billion in the second quarter of 2022 and an increase of 49.9% from RMB14.96 billion in the first quarter of 2023. The increase in cost of sales over the second quarter of 2022 and the first quarter of 2023 was mainly attributable to the increase in vehicle deliveries.
  
  
• Gross profit was RMB6.24 billion (US$859.9 million) in the second quarter of 2023, representing an increase of 232.0% from RMB1.88 billion in the second quarter of 2022 and an increase of 62.8% from RMB3.83 billion in the first quarter of 2023.
  
  
• Vehicle margin was 21.0% in the second quarter of 2023, compared with 21.2% in the second quarter of 2022 and 19.8% in the first quarter of 2023. Excluding the impact of Li ONE, the vehicle margin of the Li L series remained stable over the first quarter of 2023.
  
  
• Gross margin was 21.8% in the second quarter of 2023, compared with 21.5% in the second quarter of 2022 and 20.4% in the first quarter of 2023.
  

Operating Expenses

• Operating expenses were RMB4.61 billion (US$635.7 million) in the second quarter of 2023, representing an increase of 61.4% from RMB2.86 billion in the second quarter of 2022 and an increase of 34.6% from RMB3.42 billion in the first quarter of 2023.
  
  
• Research and development expenses were RMB2.43 billion (US$334.5 million) in the second quarter of 2023, representing an increase of 58.4% from RMB1.53 billion in the second quarter of 2022 and an increase of 31.0% from RMB1.85 billion in the first quarter of 2023. The increase in research and development expenses over the second quarter of 2022 and the first quarter of 2023 was primarily driven by increased employee compensation as a result of our growing number of staff as well as increased expenses to support our expanding product portfolios and technologies.
  
  
• Selling, general and administrative expenses were RMB2.31 billion (US$318.5 million) in the second quarter of 2023, representing an increase of 74.3% from RMB1.33 billion in the second quarter of 2022 and an increase of 40.4% from RMB1.65 billion in the first quarter of 2023. The increase in selling, general and administrative expenses over the second quarter of 2022 and the first quarter of 2023 was primarily driven by increased employee compensation as a result of our growing number of staff as well as increased rental expenses associated with the expansion of our sales and servicing network.
  

Income/(Loss) from Operations

• Income from operations was RMB1.63 billion (US$224.2 million) in the second quarter of 2023, compared with RMB978.5 million loss from operations in the second quarter of 2022 and representing an increase of 301.3% from RMB405.2 million income from operations in the first quarter of 2023. Non-GAAP income from operations was RMB2.04 billion (US$281.8 million) in the second quarter of 2023, compared with RMB520.8 million non-GAAP loss from operations in the second quarter of 2022 and representing an increase of 130.8% from RMB885.4 million non-GAAP income from operations in the first quarter of 2023.
  

Net Income/(Loss) and Net Earnings/(Loss) Per Share

• Net income was RMB2.31 billion (US$318.6 million) in the second quarter of 2023, compared with RMB641.0 million net loss in the second quarter of 2022 and representing an increase of 147.4% from RMB933.8 million net income in the first quarter of 2023. Non-GAAP net income was RMB2.73 billion (US$376.1 million) in the second quarter of 2023, compared with RMB183.4 million non-GAAP net loss in the second quarter of 2022 and an increase of 92.9% from RMB1.41 billion non-GAAP net income in the first quarter of 2023.
  
  
• Basic and diluted net earnings per ADS⁶ attributable to ordinary shareholders were RMB2.34 (US$0.32) and RMB2.18 (US$0.30) in the second quarter of 2023, respectively, compared with RMB0.64 for both basic and diluted net loss per ADS attributable to ordinary shareholders in the second quarter of 2022, and RMB0.95 and RMB0.89 basic and diluted net earnings per ADS attributable to ordinary shareholders in the first quarter of 2023, respectively. Non-GAAP basic and diluted net earnings per ADS attributable to ordinary shareholders³ were RMB2.76 (US$0.38) and RMB2.58 (US$0.36) in the second quarter of 2023, respectively, compared with RMB0.17 for both non-GAAP basic and diluted net loss per ADS attributable to ordinary shareholders in the second quarter of 2022, respectively, and RMB1.44 and RMB1.35 non-GAAP basic and diluted net earnings per ADS attributable to ordinary shareholders in the first quarter of 2023, respectively.
  

Cash Position, Operating Cash Flow and Free Cash Flow

• Balance of cash and cash equivalents, restricted cash, time deposits and short-term investments was RMB73.77 billion (US$10.17 billion) as of June 30, 2023.
  
  
• Net cash provided by operating activities was RMB11.11 billion (US$1.53 billion) in the second quarter of 2023, compared with RMB1.13 billion net cash provided by operating activities in the second quarter of 2022 and an increase of 42.8% from RMB7.78 billion net cash provided by operating activities in the first quarter of 2023.
  
  
• Free cash flow was RMB9.62 billion (US$1.33 billion) in the second quarter of 2023, compared with RMB451.7 million free cash flow in the second quarter of 2022 and representing an increase of 43.6% from RMB6.70 billion free cash flow in the first quarter of 2023.

Business Outlook

For the third quarter of 2023, the Company expects:

• Deliveries of vehicles to be between 100,000 and 103,000 vehicles, representing an increase of 277.0% to 288.3% from the third quarter of 2022.
  
  
• Total revenues to be between RMB32.33 billion (US$4.46 billion) and RMB33.30 billion (US$4.59 billion), representing an increase of 246.0% to 256.4% from the third quarter of 2022.
  

This business outlook reflects the Company’s current and preliminary view on the business situation and market condition, which is subject to change.

Conference Call

Management will hold a conference call at 8:00 a.m. U.S. Eastern Time on Tuesday, August 08, 2023 (8:00 p.m. Beijing/Hong Kong Time on August 08, 2023) to discuss financial results and answer questions from investors and analysts.

For participants who wish to join the call, please complete online registration using the link provided below prior to the scheduled call start time. Upon registration, participants will receive the conference call access information, including dial-in numbers, passcode, and a unique access PIN. To join the conference, please dial the number provided, enter the passcode followed by your PIN, and you will join the conference instantly.

Participant Online Registration: https://s1.c-conf.com/diamondpass/10032372-jb217p.html

A replay of the conference call will be accessible through August 15, 2023, by dialing the following numbers:

United States:	+1-855-883-1031
Mainland China:	+86-400-1209-216
Hong Kong, China:	+852-800-930-639
International:	+61-7-3107-6325
Replay PIN:	10032372

Additionally, a live and archived webcast of the conference call will be available on the Company’s investor relations website at http://ir.lixiang.com.

Non-GAAP Financial Measure

The Company uses non-GAAP financial measures, such as non-GAAP cost of sales, non-GAAP research and development expenses, non-GAAP selling, general and administrative expenses, non-GAAP income/loss from operations, non-GAAP net income/loss, non-GAAP net income/loss attributable to ordinary shareholders, non-GAAP basic and diluted net earnings/loss per ADS attributable to ordinary shareholders, non-GAAP basic and diluted net earnings/loss per share attributable to ordinary shareholders and free cash flow, in evaluating its operating results and for financial and operational decision-making purposes. By excluding the impact of share-based compensation expenses, the Company believes that the non-GAAP financial measures help identify underlying trends in its business and enhance the overall understanding of the Company’s past performance and future prospects. The Company also believes that the non-GAAP financial measures allow for greater visibility with respect to key metrics used by the Company’s management in its financial and operational decision-making.

The non-GAAP financial measures are not presented in accordance with U.S. GAAP and may be different from non-GAAP methods of accounting and reporting used by other companies. The non-GAAP financial measures have limitations as analytical tools and when assessing the Company’s operating performance, investors should not consider them in isolation, or as a substitute for net loss or other consolidated statements of comprehensive loss data prepared in accordance with U.S. GAAP. The Company encourages investors and others to review its financial information in its entirety and not rely on a single financial measure.

The Company mitigates these limitations by reconciling the non-GAAP financial measures to the most comparable U.S. GAAP performance measures, all of which should be considered when evaluating the Company’s performance.

For more information on the non-GAAP financial measures, please see the table captioned “Unaudited Reconciliation of GAAP and Non-GAAP Results” set forth at the end of this press release.

Exchange Rate Information

This press release contains translations of certain Renminbi amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from Renminbi to U.S. dollars and from U.S. dollars to Renminbi are made at a rate of RMB7.2513 to US$1.00, the exchange rate on June 30, 2023, set forth in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the Renminbi or U.S. dollars amounts referred could be converted into U.S. dollars or Renminbi, as the case may be, at any particular rate or at all.

About Li Auto Inc.

Li Auto Inc. is a leader in China’s new energy vehicle market. The Company designs, develops, manufactures, and sells premium smart electric vehicles. Its mission is: Create a Mobile Home, Create Happiness (创造移动的家, 创造幸福的家). Through innovations in product, technology, and business model, the Company provides families with safe, convenient, and comfortable products and services. Li Auto is a pioneer to successfully commercialize extended-range electric vehicles in China. The Company started volume production in November 2019. Its current model lineup includes Li L9, a six-seat flagship family SUV, Li L8, a six-seat premium family SUV, and Li L7, a five-seat flagship family SUV. The Company leverages technology to create value for its users. It concentrates its in-house development efforts on its proprietary range extension system, next-generation electric vehicle technology, and smart vehicle solutions while expanding its product line by developing new BEVs and EREVs to target a broader user base.

For more information, please visit: http://ir.lixiang.com.

Safe Harbor Statement

This press release contains statements that may constitute “forward-looking” statements pursuant to the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “targets,” “likely to,” “challenges,” and similar statements. Li Auto may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”) and The Stock Exchange of Hong Kong Limited (the “HKEX”), in its annual report to shareholders, in press releases and other written materials, and in oral statements made by its officers, directors, or employees to third parties. Statements that are not historical facts, including statements about Li Auto’s beliefs, plans, and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Li Auto’s strategies, future business development, and financial condition and results of operations; Li Auto’s limited operating history; risks associated with extended-range electric vehicles; Li Auto’s ability to develop, manufacture, and deliver vehicles of high quality and appeal to customers; Li Auto’s ability to generate positive cash flow and profits; product defects or any other failure of vehicles to perform as expected; Li Auto’s ability to compete successfully; Li Auto’s ability to build its brand and withstand negative publicity; cancellation of orders for Li Auto’s vehicles; Li Auto’s ability to develop new vehicles; and changes in consumer demand and government incentives, subsidies, or other favorable government policies. Further information regarding these and other risks is included in Li Auto’s filings with the SEC and the HKEX. All information provided in this press release is as of the date of this press release, and Li Auto does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

For investor and media inquiries, please contact:

Li Auto Inc.
Investor Relations
Email: ir@lixiang.com

The Piacente Group, Inc.
Yang Song
Tel: +86-10-6508-0677
Email: Li@tpg-ir.com

Brandi Piacente
Tel: +1-212-481-2050
Email: Li@tpg-ir.com

Li Auto Inc. Unaudited Condensed Consolidated Statements of Comprehensive Income
(All amounts in thousands, except for ADS/ordinary share and per ADS/ordinary share data)
		For the Three Months Ended
		June 30, 2022		March 31, 2023		June 30, 2023		June 30, 2023
		RMB		RMB		RMB		US$
Revenues:
Vehicle sales		8,483,612		18,327,316		27,971,944		3,857,507
Other sales and services		249,009		459,737		680,783		93,884
Total revenues		8,732,621		18,787,053		28,652,727		3,951,391
Cost of sales:
Vehicle sales		(6,687,273)		(14,705,143)		(22,084,087)		(3,045,535)
Other sales and services		(167,048)		(251,804)		(333,362)		(45,973)
Total cost of sales		(6,854,321)		(14,956,947)		(22,417,449)		(3,091,508)
Gross profit		1,878,300		3,830,106		6,235,278		859,883
Operating expense:
Research and development		(1,531,644)		(1,852,297)		(2,425,600)		(334,506)
Selling, general and administrative		(1,325,113)		(1,645,307)		(2,309,210)		(318,455)
Other operating income, net		—		72,701		125,402		17,294
Total operating expenses		(2,856,757)		(3,424,903)		(4,609,408)		(635,667)
(Loss)/Income from operations		(978,457)		405,203		1,625,870		224,216
Other (expense)/income:
Interest expense		(21,172)		(32,438)		(28,440)		(3,922)
Interest income and investment income, net		249,662		418,531		430,262		59,336
Others, net		104,695		181,488		324,291		44,722
(Loss)/Income before income tax		(645,272)		972,784		2,351,983		324,352
Income tax benefit/(expense)		4,226		(38,947)		(41,885)		(5,776)
Net (loss)/income		(641,046)		933,837		2,310,098		318,576
Less: Net (loss) /income attributable to noncontrolling interests		(23,080)		4,169		16,945		2,337
Net (loss)/income attributable to ordinary shareholders of Li Auto Inc.		(617,966)		929,668		2,293,153		316,239
Net (loss)/income		(641,046)		933,837		2,310,098		318,576
Other comprehensive income/(loss)
Foreign currency translation adjustment, net of tax		1,058,208		27,607		(120,809)		(16,660)
Total other comprehensive income/(loss)		1,058,208		27,607		(120,809)		(16,660)
Total comprehensive income		417,162		961,444		2,189,289		301,916
Less: Net (loss) /income attributable to noncontrolling interests		(23,080)		4,169		16,945		2,337
Comprehensive income attributable to ordinary shareholders of Li Auto Inc.		440,242		957,275		2,172,344		299,579
Weighted average number of ADSs
Basic		965,395,732		979,166,653		980,693,361		980,693,361
Diluted		965,395,732		1,052,402,047		1,053,852,487		1,053,852,487
Net (loss)/earnings per ADS attributable to ordinary shareholders
Basic		(0.64)		0.95		2.34		0.32
Diluted		(0.64)		0.89		2.18		0.30
Weighted average number of ordinary shares
Basic		1,930,791,463		1,958,333,306		1,961,386,723		1,961,386,723
Diluted		1,930,791,463		2,104,804,095		2,107,704,975		2,107,704,975
Net (loss)/earnings per share attributable to ordinary shareholders
Basic		(0.32)		0.47		1.17		0.16
Diluted		(0.32)		0.45		1.09		0.15

Li Auto Inc. Unaudited Condensed Consolidated Balance Sheets
(All amounts in thousands)
				As of
		December 31, 2022		June 30, 2023		June 30, 2023
		RMB		RMB		US$
ASSETS
Current assets:
Cash and cash equivalents		38,478,016		60,741,006		8,376,568
Restricted cash		1,940,142		1,514,643		208,879
Time deposits and short-term investments		18,031,395		11,513,001		1,587,715
Trade receivable		48,381		84,394		11,638
Inventories		6,804,693		5,659,293		780,452
Prepayments and other current assets		1,689,860		3,084,491		425,371
Total current assets		66,992,487		82,596,828		11,390,623
Non-current assets:
Long-term investments		1,484,491		777,446		107,215
Property, plant and equipment, net		11,187,898		13,013,624		1,794,661
Operating lease right-of-use assets, net		3,538,911		3,817,676		526,482
Intangible assets, net		832,620		840,008		115,842
Goodwill		5,484		5,484		756
Deferred tax assets		74,767		—		—
Other non-current assets		2,421,293		2,072,851		285,859
Total non-current assets		19,545,464		20,527,089		2,830,815
Total assets		86,537,951		103,123,917		14,221,438
LIABILITIES AND EQUITY
Current liabilities:
Short‑term borrowings		390,750		6,344,154		874,899
Trade and notes payable		20,024,329		31,269,120		4,312,209
Amounts due to related parties		7,190		6,741		930
Deferred revenue, current		569,234		1,125,700		155,241
Operating lease liabilities, current		696,454		813,495		112,186
Accruals and other current liabilities		5,684,644		7,186,468		991,057
Total current liabilities		27,372,601		46,745,678		6,446,522
Non-current liabilities:
Long-term borrowings		9,230,807		1,449,547		199,902
Deferred revenue, non-current		581,598		587,643		81,040
Operating lease liabilities, non-current		1,946,367		2,127,695		293,423
Deferred tax liabilities		77,809		45,512		6,276
Other non-current liabilities		2,142,462		2,924,365		403,288
Total non-current liabilities		13,979,043		7,134,762		983,929
Total liabilities		41,351,644		53,880,440		7,430,451
Total Li Auto Inc. shareholders’ equity		44,858,701		48,894,757		6,742,896
Noncontrolling interests		327,606		348,720		48,091
Total shareholders’ equity		45,186,307		49,243,477		6,790,987
Total liabilities and shareholders’ equity		86,537,951		103,123,917		14,221,438

Li Auto Inc. Unaudited Condensed Consolidated Statements of Cash Flows
(All amounts in thousands)
		For the Three Months Ended
		June 30, 2022		March 31, 2023		June 30, 2023		June 30, 2023
		RMB		RMB		RMB		US$
Net cash provided by operating activities		1,129,407		7,780,366		11,112,395		1,532,469
Net cash (used in)/provided by investing activities		(740,518)		(2,692,753)		7,573,941		1,044,494
Net cash provided by/(used in) financing activities		1,026,855		(195,821)		(1,853,582)		(255,621)
Effect of exchange rate changes		962,704		(25,241)		138,186		19,058
Net change in cash, cash equivalents and restricted cash		2,378,448		4,866,551		16,970,940		2,340,400
Cash, cash equivalents and restricted cash at beginning of period		34,716,572		40,418,158		45,284,709		6,245,047
Cash, cash equivalents and restricted cash at end of period		37,095,020		45,284,709		62,255,649		8,585,447
Net cash provided by operating activities		1,129,407		7,780,366		11,112,395		1,532,469
Capital expenditures		(677,755)		(1,078,295)		(1,491,029)		(205,622)
Free cash flow (non-GAAP)		451,652		6,702,071		9,621,366		1,326,847

Li Auto Inc. Unaudited Reconciliation of GAAP and Non-GAAP Results
(All amounts in thousands, except for ADS/ordinary share and per ADS/ordinary share data)
		For the Three Months Ended
		June 30, 2022		March 31, 2023		June 30, 2023		June 30, 2023
		RMB		RMB		RMB		US$
Cost of sales		(6,854,321)		(14,956,947)		(22,417,449)		(3,091,508)
Share-based compensation expenses		9,301		11,186		9,449		1,303
Non-GAAP cost of sales		(6,845,020)		(14,945,761)		(22,408,000)		(3,090,205)
Research and development expenses		(1,531,644)		(1,852,297)		(2,425,600)		(334,506)
Share-based compensation expenses		301,449		336,220		247,064		34,072
Non-GAAP research and development expenses		(1,230,195)		(1,516,077)		(2,178,536)		(300,434)
Selling, general and administrative expenses		(1,325,113)		(1,645,307)		(2,309,210)		(318,455)
Share-based compensation expenses		146,858		132,823		160,928		22,193
Non-GAAP selling, general and administrative expenses		(1,178,255)		(1,512,484)		(2,148,282)		(296,262)
(Loss)/Income from operations		(978,457)		405,203		1,625,870		224,216
Share-based compensation expenses		457,608		480,229		417,441		57,568
Non-GAAP (loss)/income from operations		(520,849)		885,432		2,043,311		281,784
Net (loss)/income		(641,046)		933,837		2,310,098		318,576
Share-based compensation expenses		457,608		480,229		417,441		57,568
Non-GAAP net (loss)/income		(183,438)		1,414,066		2,727,539		376,144
Net (loss)/income attributable to ordinary shareholders of Li Auto Inc.		(617,966)		929,668		2,293,153		316,239
Share-based compensation expenses		457,608		480,229		417,441		57,568
Non-GAAP net (loss)/income attributable to ordinary shareholders of Li Auto Inc.		(160,358)		1,409,897		2,710,594		373,807
Weighted average number of ADSs (non-GAAP)
Basic		965,395,732		979,166,653		980,693,361		980,693,361
Diluted		965,395,732		1,052,402,047		1,053,852,487		1,053,852,487
Non-GAAP net (loss)/earnings per ADS attributable to ordinary shareholders
Basic		(0.17)		1.44		2.76		0.38
Diluted		(0.17)		1.35		2.58		0.36
Weighted average number of ordinary shares (non-GAAP)
Basic		1,930,791,463		1,958,333,306		1,961,386,723		1,961,386,723
Diluted		1,930,791,463		2,104,804,095		2,107,704,975		2,107,704,975
Non-GAAP net (loss)/earnings per share attributable to ordinary shareholders7
Basic		(0.08)		0.72		1.38		0.19
Diluted		(0.08)		0.67		1.29		0.18

¹ All translations from Renminbi (“RMB”) to U.S. dollar (“US$”) are made at a rate of RMB7.2513 to US$1.00, the exchange rate on June 30, 2023 as set forth in the H.10 statistical release of the Federal Reserve Board.

² Vehicle margin is the margin of vehicle sales, which is calculated based on revenues and cost of sales derived from vehicle sales only.

³ The Company’s non-GAAP financial measures exclude share-based compensation expenses. See “Unaudited Reconciliation of GAAP and Non-GAAP Results” set forth at the end of this press release.

⁴ Free cash flow represents operating cash flow less capital expenditures, which is considered a non-GAAP financial measure.

⁵ Except for vehicle margin and gross margin, where absolute changes instead of percentage changes are presented.

⁶ Each ADS represents two Class A ordinary shares.

⁷ Non-GAAP basic net earnings/loss per share attributable to ordinary shareholders is calculated by dividing non-GAAP net income/loss attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the periods. Non-GAAP diluted net earnings/loss per share attributable to ordinary shareholders is calculated by dividing non-GAAP net income/loss attributable to ordinary shareholders by the weighted average number of ordinary shares, dilutive potential ordinary shares outstanding during the periods, including the dilutive effects of convertible senior notes as determined under the if-converted method and the dilutive effect of share-based awards as determined under the treasury stock method.

FAQ

What were Li Auto's total revenues for the quarter ended June 30, 2023?

Li Auto's total revenues for the quarter ended June 30, 2023, were RMB28.65 billion ($3.95 billion).

What was the YoY increase in quarterly deliveries for Li Auto?

Li Auto experienced a 201.6% YoY increase in quarterly deliveries, reaching 86,533 vehicles.

What were Li Auto's vehicle sales for the quarter ended June 30, 2023?

Li Auto's vehicle sales for the quarter ended June 30, 2023, were RMB27.97 billion ($3.86 billion).

What was the YoY increase in gross profit for Li Auto?

Li Auto achieved a 232.0% YoY increase in gross profit, reaching RMB6.24 billion ($859.9 million).

What was the YoY increase in net income for Li Auto?

Li Auto recorded a 147.4% YoY increase in net income, reaching RMB2.31 billion ($318.6 million).