Investment Rating - The report maintains an "Outperform" rating for the company [5]. Core Views - The company has received the first batch of operational certificates for manned civil unmanned aerial vehicles in China, marking the beginning of commercial operations in the low-altitude economy [2][31]. - The company has a robust order backlog, with over 1,500 units of the EH216 series aircraft on hand, and expects to receive more than 1,200 new orders from Q3 2023 to December 2024 [2][26]. - The company is expanding its production capacity, planning to double the size of its Yunfu production base to 48,000 square meters and increase annual production capacity to 1,000 units by the end of the year [2][39]. Financial Summary - In Q1 2025, the company reported revenue of 26.09 million yuan, a year-on-year decrease of 57.7% and a quarter-on-quarter decrease of 84.1% [1][8]. - The net profit attributable to shareholders was -78.08 million yuan, compared to -63.33 million yuan in the same period last year [1][8]. - The adjusted net profit (non-GAAP) was -30.82 million yuan, a significant decline from the previous year's -10.03 million yuan [1][8]. - The gross margin for Q1 2025 was 62.4%, showing an increase compared to the previous year [14]. Revenue and Profit Forecast - Revenue forecasts for 2025-2027 are set at 860 million yuan, 1.205 billion yuan, and 1.579 billion yuan, respectively, with expected growth rates of 88.4%, 40.2%, and 31.0% [4]. - The net profit forecasts for the same period are -143 million yuan, 61 million yuan, and 194 million yuan, reflecting a downward adjustment in profit expectations [4][3].

Investment Rating - The investment rating for the company is "Buy" with a 6-month outlook maintained [5]. Core Insights - The company reported a revenue of 26.1 million yuan in Q1 2025, down from 61.7 million yuan in the same period last year, with a gross margin of 62.4% compared to 61.9% year-on-year. The adjusted net loss was 31.1 million yuan, increasing from 10.1 million yuan year-on-year [1]. - The company has received the operational certificate (OC) for its EH216-S model, allowing for commercial flight services in designated areas. This certification is expected to accelerate the company's commercial operations and expand its market presence [2]. - The company is expanding its production capacity with plans to increase annual output to 1,000 units by the end of 2025, supported by the construction of a new production base in Yunfu and a strategic partnership in Hefei [4]. - The revenue guidance for 2025 is set at 900 million yuan, representing a year-on-year growth of 97%, with expectations of continued growth in revenue for the years 2025 to 2027 [4]. Business Progress - The company has successfully obtained the first batch of operational certificates for its EH216-S from the Civil Aviation Administration of China (CAAC), enabling commercial operations [2]. - The international market expansion includes successful test flights in Spain and Mexico, increasing the number of countries where the company operates to 19 [2]. Product Development - The new generation eVTOL, VT35, is currently undergoing airworthiness certification with the CAAC, and the prototype has completed manufacturing and is in the testing phase, with plans for release in Q3 2025 [3].

低空经济的繁荣时代正在拉开序幕。 5月23日，在第九届世界无人机大会现场，深圳联合飞机科技有限公司（下称"联合飞机"）一 款"铂影T1400"重载无人直升机完成全球首发，其最大有效载荷可达650kg，载重200kg条件下续 航时间大于8小时。 当天，联合飞机副总裁孟月华向经济观察报记者表示， 无人机在物流运输、应急救援等领域的应 用 正在 逐渐扩大 ，上述产品大载重、长续航的特性适用大型运输或救援场景，如搭建空中基站、 恢复通讯，或调运伤员、投放物资等。她认为，2024年是低空经济的元年，今年则是低空经济"从 示范到试点"之年。 4月底，在广东汇天航空航天科技有限公司（下称"小鹏汇天"）一场飞行汽车"陆地航母"的试飞现 场，小鹏汇天合伙人林森才对经济观察报记者称，该款产品将在明年第二季度大规模交付，售价在 200万元以内，"主要是用来体验，让客户看到产品和落地场景"。 2024年，低空经济被首次写入政府工作报告。此后，中央部委、地方政府密集出台支持低空经济 发展的相关产业政策和发展规划，中国低空经济产业发展迎来政策支持关键期。 在曾任中国民用航空华北地区空中交通管理局党委书记的航空领域专家许超前看来，当下正是 ...

Core Viewpoint - The event marked the first flight demonstration of EHang's EH216-S eVTOL in the UNESCO World Heritage site of Jingmai Mountain, showcasing a balance between ecological protection and technological application in tourism [1][2]. Group 1: Event and Technology - The flight demonstration of the EH216-S eVTOL took place in Pu'er City, highlighting the integration of technology in cultural heritage and tourism [1][2]. - The EH216-S is an all-electric, zero-emission aircraft designed for short-distance commuting and sightseeing, capable of carrying two passengers [7]. Group 2: Economic Development and Collaboration - Pu'er City aims to leverage low-altitude economy as a driver for multi-sectoral development, including transportation, tourism, environmental protection, and rural revitalization [2][5]. - The establishment of two low-altitude economic platform companies, Pu'er Sky City Development Co., Ltd. and Pu'er Tea City Wings Drone Co., Ltd., signifies a strategic move to explore innovative development models in the low-altitude economy [5]. Group 3: Future Applications and Impact - Future applications of drones in Pu'er will include emergency rescue, firefighting, agricultural protection, and pilot training, positioning the drone industry as a key driver for industrial transformation [5]. - The EH216-L logistics version and EH216-F firefighting version were also showcased, indicating a comprehensive service model for the "low-altitude + tea industry" [8].

Core Insights - The emergence of flying cars and eVTOLs represents a significant evolution in the low-altitude economy, transitioning from science fiction to reality [3][4] - The current landscape shows a division between flying cars and eVTOLs, with eVTOLs dominating the commercial market due to lower development costs and regulatory hurdles [10][19] - The industry is heavily reliant on existing electric vehicle technology, raising questions about the true innovation behind these aerial vehicles [5][14] Industry Overview - The first operational certificate for a manned autonomous aircraft was issued in March 2025, marking a milestone in the industry [4] - eVTOLs are primarily focused on vertical takeoff and landing, while flying cars require dual systems for both ground and air travel, complicating their development [10][12] - The eVTOL market is projected to grow significantly, with companies like EHang reporting revenues of 456.2 million yuan, a 288.5% increase year-on-year [19] Market Dynamics - The current market for flying cars is still in the conceptual phase, while eVTOLs have begun to see commercial viability, with over 70% market share [19] - Companies are facing challenges in meeting aviation safety standards, which differ significantly from automotive regulations, leading to increased costs and development time [16][17] - The infrastructure for low-altitude operations is lagging, with only 23 out of 1000 planned takeoff and landing points completed by 2025 [17] Customer Segmentation - The primary customers for eVTOLs are government entities, with commercial applications still limited [22][23] - The high cost of flying cars makes them accessible only to affluent individuals, with prices exceeding one million yuan and additional operational costs [23] - Companies are exploring various business models, including cargo transport and emergency services, to validate their technologies and achieve profitability [19][24] Future Outlook - The next decade will be crucial for the low-altitude economy, with a focus on identifying real market needs and pain points [24] - The industry is expected to consolidate, with many flying car projects likely to fail, leaving only those that address genuine market demands [24] - The evolution of this sector will continue to draw from the supply chains established in the electric vehicle industry, indicating a strong interconnection between these two markets [24]

Core Insights - The article highlights the growing trend of low-altitude tourism projects in county regions, driven by natural endowments and the need to upgrade traditional tourism models [1][2] - The integration of low-altitude economy into existing industrial chains is emphasized as a way to create unique competitive advantages [1][4] Low-altitude Tourism Development - Low-altitude tourism projects, such as those in Shaanxi Yichuan and Anhui Yi County, are enhancing visitor experiences and stimulating local tourism [2] - The average daily reception for the Yichuan project exceeds 400 visitors during peak season, while the "Aerial View of Hongcun" project is expected to attract nearly 120,000 visitors in 2024 [2] - Current low-altitude tourism experiences utilize helicopters or light aircraft, with prices ranging from 300 to over 1,000 yuan per experience [2] - The advancement of eVTOL (electric Vertical Take-Off and Landing) aircraft is anticipated to lower the costs of these experiences [2] Strategic Collaborations and Infrastructure - EHang Intelligent has received operational certificates for its passenger drones, with plans to collaborate with various counties for low-altitude tourism projects [2][4] - Zhejiang Wencheng County has signed a strategic agreement to procure 300 EH216-S drones for air tourism and transportation development [2] - Wencheng County plans to establish 43 eVTOL take-off and landing points within three years, with five already completed [5] Regulatory and Management Innovations - The article discusses the importance of airspace management in promoting low-altitude economic development, with counties becoming testing grounds for innovative airspace policies [4] - Sichuan's pilot program for low-altitude airspace management has significantly reduced approval times for temporary airspace applications [4] Competitive Landscape and Differentiation - Counties are diversifying their low-altitude economy initiatives beyond tourism to include logistics and emergency services [6] - Zhejiang's pilot program for low-altitude economy aims to integrate flying with urban logistics and rural services [6] - Differentiation strategies include leveraging local industrial strengths and developing niche markets such as extreme sports and drone services [6] Safety and Technological Integration - The article stresses the need for safety measures and technological integration in developing low-altitude economies, including the use of big data and AI for air traffic management [6][7]

Investment Rating - The report maintains a "BUY" rating for EHang Holdings with an unchanged target price of US$30, indicating a potential upside of 76.9% from the current price of US$16.96 [1][3][17]. Core Insights - EHang's 1Q25 results were below expectations, with a 58% year-over-year decline in eVTOL aircraft deliveries, totaling only 11 units due to delays caused by weather, Chinese New Year seasonality, and operator certificate approvals. However, management anticipates a recovery in sales in 2Q25 [1][6]. - The company aims for a revenue target of RMB900 million in 2025, representing a 97% year-over-year growth, alongside a 40% increase in selling, general, and administrative (SG&A) expenses [1][2]. - EHang is recognized as a first-mover in the eVTOL market in China, having obtained essential certifications for mass production and operation [1][6]. Financial Summary - Revenue for FY25 is projected at RMB898 million, with a year-over-year growth of 97%. The adjusted net profit is expected to improve to a loss of RMB64 million, with a return to profitability anticipated in FY26 with a net profit of RMB178 million [2][14]. - The gross margin for 1Q25 slightly expanded to 62.4%, despite a significant revenue decline [6][7]. - EHang's inventories increased by 44% to RMB109 million as of March 2025, attributed to shipment delays [6]. Product Development - The VT35 eVTOL is the next key product, currently undergoing certification processes in China, with plans for a launch in 3Q25 [6][7]. - EHang has successfully obtained operating certificates for its subsidiaries, with commercial operations expected to commence in the coming months as safety remains a priority [6][7].

Core Viewpoint - The third Civil Aviation Science and Technology Innovation Achievement Exhibition showcased advanced flying vehicles, including flying cars and eVTOLs, highlighting innovations aimed at addressing urban congestion and enhancing short-distance travel efficiency [1][2][3]. Group 1: Flying Cars - The GOVY AirCar features a dual-structure design with an autonomous car and a flying vehicle, capable of reducing urban commute times from one hour to just 15 minutes [1]. - The GOVY AirJet, a high-performance flying car, can reach speeds of up to 250 km/h and facilitate intercity travel within 40 minutes across the Guangdong-Hong Kong-Macao Greater Bay Area [1][2]. - High safety measures are implemented in these flying cars, including a perception system that can identify small objects from 100 meters away, and the use of high-density liquid lithium-ion batteries [2]. Group 2: eVTOLs - The M1 eVTOL developed by Shanghai Yufeng Future Aviation Technology can carry five passengers, has a maximum load of 700 kg, and a cruising speed of 200 km/h with a range of 250 km [2][3]. - The M1 is designed for urban commuting and intercity connections, significantly reducing travel times from 2-3 hours to just 15-30 minutes [3]. - By 2030, the M1 is expected to establish fixed passenger routes, contributing to a three-dimensional transportation network [3]. Group 3: Industry Developments - EHang's EH216-S, a passenger drone, has begun commercial operations in Hefei, primarily for tourism, marking a significant step in China's low-altitude economy [4]. - EHang has established over 20 operational demonstration points across 16 cities in China, aiming to provide eVTOL flight services to the public [4]. - The exhibition serves as a platform for promoting innovation in civil aviation, focusing on the integration of education, technology, and talent within the industry [5].

CHANG | | 2 EHang Holdings Limited Q1 2025 Operational & Financial Results Notes: The photo shows EH216-S's flight in Benidorm, Spain, in February 2025. GHVNG IIZAL www.ehang.com Disclaimer These materials have been prepared by EHang Holdings Limited (the "Company") solely for informational purposes and have not been independently verified. No representations or warranties, express or implied, are made as to, and no reliance should be placed on, the accuracy, fairness or correctness of the information or op ...

Financial Data and Key Metrics Changes - Total revenues for Q1 2025 were RMB 26.1 million, a decrease compared to Q1 2024 and Q4 2024, primarily driven by decreased sales volume of EH216 series products [31][32] - Gross profit was RMB 16.3 million in Q1, with a gross margin improvement to 62.4% compared to 61.9% in the same period of 2024 and 60.7% in Q4 2024, indicating strong marketing competitiveness and pricing power [32] - Adjusted net loss was RMB 31.1 million in Q1, reflecting a decline in deliveries, but the company expects financial performance to improve as deliveries recover [34][36] Business Line Data and Key Metrics Changes - In Q1 2025, the company delivered 11 units of the EH216S, with the low delivery volume attributed to seasonal slowdown, internal budgeting processes of clients, and deferred orders due to the upcoming OC certification [14][15] - The company is expanding its Yunfu production base, which has doubled in size and will support an annual production capacity of up to 1,000 units once fully operational [16] Market Data and Key Metrics Changes - Following the issuance of operating certificates (OCs), consumer inquiries and order volumes have significantly increased, with expectations for a strong rebound in Q2 [18][19] - Major orders from provinces such as Jilin, Jiangxi, Guizhou, Hainan, Anhui, and Guangdong are expected to convert into deliveries starting in Q2 [19] Company Strategy and Development Direction - The company aims to evolve from manufacturing autonomous aerial vehicles into a comprehensive urban air mobility platform operator, providing a one-stop solution covering aircraft hardware, software, operational services, and standard systems [6] - The company is focused on a phased approach to commercialization, starting with low-risk scenarios like sightseeing flights before expanding into more complex urban air mobility services [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth momentum over the next few quarters, maintaining the annual revenue guidance of RMB 900 million for 2025 [36][39] - The company is committed to safety and is implementing enhanced standards to ensure safe and compliant flight operations as it transitions to commercial operations [19][20] Other Important Information - The company has over 700 issued and pending patent assets worldwide, with nearly half of its team dedicated to R&D, positioning it as a global leader in autonomous flight systems [12] - The company is actively expanding its business into logistics and emergency rescue applications, with specialized UAVs already developed for these use cases [25][26] Q&A Session Summary Question: Outlook on significant growth in sales and deliveries - Management noted that Q1 performance declined due to seasonal impacts and deferred orders, but improvements in Q2 delivery volumes and sales are expected, with large orders converting into contracts [38] Question: Timeline for EH216 owners to obtain OC certificates - Management indicated that the issuance of OCs clarifies regulatory standards, which should reduce application timelines for future operators [41] Question: Competition and staying competitive - Management highlighted that urban air mobility and intercity air transport serve different markets, with the EH216S offering a compact footprint and lower costs compared to competitors [45][46] Question: Updates on production capacity and SG&A expenses - Management confirmed that the Yunfu facility's production capacity will increase to 1,000 units by the end of the year, and they will maintain stringent control on SG&A expense growth [81][83]