Li Auto Inc. (LI)

Price$12.37Cached quoteAs of 2026-09-05 06:36 UTC

AI: Fair-priced

Price checkThe price looks fair because cash is strong, but buyers still need a meaningful profit recovery.

The equity market value is roughly US$12 billion, about 0.7 times 2025 sales and roughly 1.2 times June shareholder equity. Li Auto’s June cash position was CNY87.5 billion; after about CNY7.2 billion of borrowings, that broad net cash nearly matches the market value. However, those funds also support working capital and investment, so they are not all surplus cash. The shares were about ten times 2024 earnings, but more than sixty times 2025 earnings, while current earnings are negative. That balance supports a fair-priced verdict.

Big picturePast profits were real, but recent cash losses show the business remains highly sensitive to product cycles.

Net income rose to CNY11.8 billion in 2023, slipped to CNY8.0 billion in 2024, then fell to CNY1.1 billion in 2025. Free cash flow, meaning cash left after running and investing in the business, dropped from about CNY44.2 billion in 2023 to CNY8.2 billion in 2024 and negative CNY12.8 billion in 2025. The first half of 2026 remained negative, although second-quarter free cash outflow improved sharply to CNY1.3 billion. This pattern shows that model launches, pricing, and vehicle mix can swing earnings quickly.

Business strengthA debt-light balance sheet and aggressive buybacks provide support, though past share growth diluted owners.

At June 2026, Li Auto reported CNY40.1 billion of cash, CNY45.5 billion of time deposits and short-term investments, plus additional long-term investments, against only about CNY7.2 billion of borrowings. The company authorized a US$1.0 billion repurchase program in March. During the second quarter it bought roughly 60.2 million Class A share equivalents, close to 3% of the 2025 year-end share count. That is meaningful capital return, but earlier dilution matters: shares outstanding increased about 12% from 2020 through 2025.

What could change the storyThe stock becomes attractive with sustained margin recovery, but continued low margins would justify today’s discount.

The strongest bull case is a recovery in vehicle economics as refreshed L6 and L8 models scale. Gross margin improved from 7.9% in the first quarter to 11.0% in the second, but it remains far below the roughly 20% level seen a year earlier. A sustained gross margin above 15%, positive free cash flow, and annual profit around half of 2024’s level would make the valuation look cheap. The bear case is margins staying near 10%, keeping earnings negative and gradually consuming the cash cushion.

AI: News

Second-quarter loss continuesSecond-quarter results showed another loss, but margins and cash flow improved from the much weaker first quarter.

On August 26, Li Auto reported second-quarter revenue of CNY25.7 billion, down 15.1% year over year, with 98,330 deliveries and a CNY1.7 billion net loss. Gross margin improved to 11.0% from 7.9% in the first quarter, while free cash flow improved to negative CNY1.3 billion from negative CNY7.4 billion. Third-quarter guidance called for 95,000 to 100,000 deliveries and CNY26.6 billion to CNY28.0 billion of revenue. The shares fell after the release, though trading timing alone cannot prove causation.

July deliveries stabilizeJuly deliveries nearly stabilized, but stronger rival growth kept pressure on Li Auto’s competitive outlook.

Li Auto delivered 30,468 vehicles in July, down 0.9% from a year earlier and 1.4% from June. That was a clear improvement from June’s 14.8% year-over-year decline. A brief headlight shortage reduced planned i6 output by about 4,000 units, while the refreshed L6 began deliveries. U.S.-listed shares traded lower before the next session, and Hong Kong shares later fell 2.9% alongside other Chinese electric-vehicle names. The delivery update was relevant, but broader sector weakness makes precise attribution uncertain.

First-quarter margin collapseFirst-quarter margins collapsed despite higher deliveries, exposing how quickly volume growth can stop producing profits.

On May 28, Li Auto reported 95,142 first-quarter deliveries, up 2.5% year over year, yet revenue fell 11.4% and vehicle margin dropped to 6.1% from 19.8%. The company posted a CNY2.3 billion net loss and negative CNY7.4 billion of free cash flow. The key message was that modest volume growth could not offset weaker pricing and product mix. That reset profitability expectations and made later margin recovery, rather than delivery growth alone, central to the investment case.

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Free cash flow

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Financial statements

	2025	2024	2023	2022	2021	2020	2019	2018
Revenue	$16.06B	$19.79B	$17.44B	$6.57B	$4.24B	$1.45B	—	—
Gross profit	$3.00B	$4.06B	$3.87B	$1.27B	$904.1M	$237.4M	—	—
Gross margin	18.68%	20.53%	22.20%	19.41%	21.33%	16.38%	—	—
Research & development	$1.62B	$1.52B	$1.49B	$983.0M	$515.7M	$168.6M	—	—
Operating expenses	$3.08B	$3.10B	$2.83B	$1.80B	$1.06B	$340.0M	—	—
Operating income	−$74.5M	$961.6M	$1.04B	−$529.9M	−$159.6M	−$102.6M	—	—
Operating margin	−0.46%	4.86%	5.98%	−8.07%	−3.77%	−7.08%	—	—
EBITDA	$588.3M	$1.38B	$1.30B	−$353.9M	−$67.0M	−$53.4M	—	—
EBITDA margin	3.66%	6.98%	7.44%	−5.39%	−1.58%	−3.68%	—	—
Net income	$162.9M	$1.10B	$1.66B	−$294.7M	−$50.4M	−$23.2M	—	—
Net profit margin	1.01%	5.57%	9.53%	−4.49%	−1.19%	−1.60%	—	—
Basic EPSper basic share	$0.08	$0.55	$0.84	-$0.15	-$0.03	-$0.14	—	—
Diluted EPSper diluted share	$0.08	$0.52	$0.78	-$0.15	-$0.03	-$0.14	—	—

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Owners

Reported shareholders

Reference date Jun 30, 2026

Reported holdings Number of shares

View holders

Top 20 reported holders of LI
Holder	Shares held
RENAISSANCE TECHNOLOGIES LLC	6.52M
Xiamen Xinweidachuang Investment Partnership (Limited Partnership)	4.93M
MORGAN STANLEY	4.64M
UBS Group AG	3.15M
CITIGROUP INC	2.79M
SIH Partners, LLLP	2.62M
BANK OF AMERICA CORP /DE/	2.2M
AMERICAN CENTURY COMPANIES INC	2.17M
GOLDMAN SACHS GROUP INC	1.27M
BlackRock, Inc.	915.39K
CITADEL ADVISORS LLC	893.26K
DEUTSCHE BANK AG\	751.72K
JANE STREET GROUP, LLC	719.62K
HSBC HOLDINGS PLC	647.09K
STATE STREET CORP	613.57K
MILLENNIUM MANAGEMENT LLC	577.84K
Legal & General Group Plc	573.03K
MARSHALL WACE, LLP	486.71K
BNP PARIBAS FINANCIAL MARKETS	383.26K
BARCLAYS PLC	303.78K

Bars compare reported share counts. A matching total for this share class and reporting period is unavailable, so percentages are not shown.

Source: SEC Form 13F ↗Updated Sep 29, 2026 · Quarterly data

Insider buys & sells

Jul 1, 2024–Jun 30, 2026

Buys0$0.00 disclosed value

Sells (SEC code S)0$0.00 disclosed value

No insider transactions transactions were reported in the stored SEC coverage.

Review ownership filings at SEC.gov ↗

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