China Automotive Systems Reports 77.8% EPS Growth in the Third Quarter of 2025 and Raises Full Year Guidance

Core Viewpoint - China Automotive Systems, Inc. (CAAS) reported strong financial results for Q3 2025, with significant growth in sales, gross profit, and net income, driven by increased demand for advanced steering products and international sales expansion [4][5][6]. Financial Performance - Net sales for Q3 2025 rose 17.7% year-over-year to $193.2 million, up from $164.2 million in Q3 2024 [5][6]. - Gross profit increased by 26.6% year-over-year to $33.4 million, with a gross profit margin of 17.3%, compared to 16.0% in Q3 2024 [5][7]. - Net income attributable to parent company's common shareholders surged 75.6% to $9.7 million, with diluted earnings per share rising 77.8% to $0.32 [5][14]. Sales Breakdown - North American sales climbed 77.3% to $33.1 million, while sales in Brazil grew 30.5% to $18.6 million [6][5]. - The subsidiary Henglong reported a 7.7% increase in net sales to $88.8 million, and Jiulong's sales to the domestic commercial vehicle market rose 44.4% to $24.9 million [6][5]. Operational Highlights - The company transitioned to more technology-focused advanced steering products, with record-setting new orders for its intelligent electro-hydraulic circulating ball power steering (iRCB) [4]. - CAAS became a tier-1 supplier for advanced steering systems to major global OEMs, winning its first R-EPS product order from a well-known European automaker, expected to generate over $100 million in annual sales starting in 2027 [4]. Research and Development - R&D expenses increased to $10.4 million in Q3 2025, representing 5.4% of net sales, up from 3.9% in Q3 2024, reflecting a focus on electric power and hydraulic steering systems [11]. Balance Sheet and Cash Position - As of September 30, 2025, cash, cash equivalents, and short-term investments totaled $167.3 million, or approximately $5.54 per share, with net working capital at $173.4 million [17][6]. Business Outlook - Management raised revenue guidance for the full fiscal year 2025 to $730.0 million, based on current operating and market conditions [18].