XPENG(XPEV)2024-08-20 16:13Financial Data and Key Metrics - Total revenues for Q2 2024 were RMB8.11 billion, up 60.2% YoY and 23.9% QoQ [24] - Vehicle sales revenue was RMB6.82 billion, up 54.1% YoY and 23% QoQ [24] - Services and others revenue was RMB1.29 billion, up 102.5% YoY and 28.8% QoQ [25] - Gross margin improved to 14% in Q2 2024, compared to negative 3.9% in Q2 2023 and 12.9% in Q1 2024 [25] - Vehicle margin was 6.4% in Q2 2024, compared to negative 8.6% in Q2 2023 and 5.5% in Q1 2024 [25] - Net loss was RMB1.28 billion in Q2 2024, compared to RMB2.8 billion in Q2 2023 and RMB1.37 billion in Q1 2024 [27] Business Line Data and Key Metrics - XPeng delivered 30,207 smart EVs in Q2 2024, up 38% QoQ and 30% YoY [8] - MONA M03 pre-sell orders surpassed last year's G6 pre-sale orders in the comparable sales period [10] - XPeng G9 became the top mid to large-size all-electric SUV in Norway, Denmark, and Israel [18] Market Data and Key Metrics - Overseas sales accounted for more than 10% of total sales for the first time in Q2 2024 [18] - XPeng expanded its presence to 30 countries and regions via dealer partners and established over 70 overseas sales stores [19] - The company plans to enter more right-hand drive markets in H2 2024, including the UK, Australia, and Southeast Asia [19] Company Strategy and Industry Competition - XPeng completed a new round of organizational upgrades and internal restructuring, bringing on top talents in key areas [8] - The company is entering an intense product launch cycle with competitive new products and models to be introduced through the end of 2026 [9] - XPeng aims to offer Level 3+ autonomous software and user experience on Level 2 ADAS hardware and at a Level 2 ADAS price point [17] - The company is focusing on AI advancements to revolutionize ADAS safety and driving experience, lowering costs and speeding up mass-market adoption [13][16] Management Commentary on Operating Environment and Future Outlook - XPeng is confident of achieving substantial QoQ delivery volume growth in Q3 and Q4 2024, with a new delivery record expected in Q4 [9] - The company anticipates total delivery volume to range from 41,000 to 45,000 in Q3 2024, representing a QoQ increase of 35.7% to 49% [22] - XPeng projects Q3 total revenue to fall within the range of RMB9.1 billion to RMB9.8 billion, representing a QoQ increase of 12.2% to 20.8% [22] - The company expects overseas business to maintain strong growth momentum, leading global sales of mid to high-end smart EVs [19] Other Important Information - XPeng signed a master agreement of E/E architecture technical collaboration with Volkswagen Group to jointly develop industry-leading E/E architecture [20] - The first model equipped with the jointly developed E/E architecture is expected to go into mass production within 24 months [21] - XPeng launched AI-powered XOS version 5.2.0, taking XNGP to the next level by empowering a smooth experience anywhere regardless of city and routes [15] Q&A Session Summary Question: Sales momentum of new models - XPeng expects the market competition to be more brutal next year and has done a lot in terms of organizational transformation, supply chain management, and sales and marketing system overhaul to achieve long-term steady growth [30][31] - The company is confident in achieving the high-end of Q3 guidance, with MONA M03 expected to set a record for EV delivery by EV start-ups [32] - Overseas delivery volume is anticipated to be above 15% in Q3, diversifying overall order intake [33] Question: XNGP's high-level ADAS - XPeng has seen a 20% increase in the option rate and penetration rate of using high-level ADAS capabilities since the rollout of version 5.2.0 [35] - The company faces challenges in ensuring a solid bottom limit of ADAS capability and rolling out capabilities across different locations [36] - XPeng aims to offer affordable high-end ADAS capability to a wider range of consumers with the P7+ [37] Question: Cost-reduction strategy and Q3 gross margin trend - XPeng is focusing on commercialization capability, cost reduction driven by technology, supply-chain reforms, and strategic partnership with Volkswagen [40][41] - The company expects overall margin to be stable and maintained at mid to low-teens in H2 2024, with P7+ margin expected to be in the double-digits [43] Question: Production preparation for MONA M03 and R&D expense - XPeng has prepared MONA production capacity way ahead of time and expects to achieve planned production and delivery [62] - Engineering expenses are expected to ramp up in H2 2024, with full-year guidance remaining at about RMB7 billion [64] Question: Sales and marketing ability evaluation - XPeng has achieved the first stage of success in its reform, with improvements in products and competitiveness [70] - The company is focusing on store management, after-sales services, and sales staff training to improve overall capability and working efficiency [71] Question: Gross profit margin breakdown and autonomous driving differentiation - Overseas sales margin is healthy and helping to improve overall profitability [74] - XPeng's end-to-end AI models approach allows for a more significant and quicker development of ADAS capabilities compared to the rule-based approach [77][80]