Why Li Auto Stock Plunged Today

Core Viewpoint - Li Auto reported strong third-quarter results with significant free cash flow, but the stock declined due to underwhelming guidance and profit-taking by investors [1][4]. Financial Performance - Li Auto delivered nearly 153,000 vehicles in Q3, marking a 45.4% increase year-over-year [2]. - The company reported earnings per share of $0.26, exceeding Wall Street's expectation of $0.19 [2]. - Revenue for the quarter was $6.1 billion, surpassing estimates of $5.9 billion [2]. - Operating activities generated $1.6 billion, with free cash flow of $1.3 billion in Q3 [4]. - As of the end of Q3, Li Auto had a cash position exceeding $15 billion [4]. Market Outlook - For Q4, Li Auto anticipates revenue between $6.2 billion and $6.5 billion, while Wall Street expected $6.7 billion [5]. - The company expects a year-over-year increase of about 25% in EV deliveries for Q4 at the midpoint of its range [5]. - Despite strong demand in China's EV market, heavy competition and price wars are impacting revenue [6].