Chinese electric-vehicle maker XPeng reported a widened second-quarter net loss of 1.34 billion yuan ($199.4 million), missing analyst estimates of a 718.6 million yuan loss, as heavy investment in new models and AI technologies outweighed profits. Revenue rose 8.0% to 19.74 billion yuan, matching guidance, while deliveries jumped 65% sequentially to 103,295 vehicles. Gross margin improved to 20.7% from 17.3% a year earlier, though vehicle margins fell to 12.1% from 14.3% due to the transition to new-generation models.

For the third quarter, XPeng expects deliveries of 115,000-121,000 vehicles and revenue of 21.7-23.4 billion yuan. The key test is sustaining margins while ramping production of the new mass-market L03, expanding overseas, and investing in AI and humanoid robots. The L03, launched in July, has strong orders but production is still ramping, limiting August deliveries to a 4% rise. Analysts note the L03's margin above 10% could improve product mix by replacing lower-margin M03 sales.

Citi analysts are optimistic about Q4, citing higher export mix and better-margin models like the upcoming G9L, with exports potentially reaching 20% of deliveries. XPeng's Dogotix robotics subsidiary also secured over $900 million in funding from investors including Tencent and [ADDRESS], valuing the business at over $6.3 billion.