XPeng (XPEV) Stock Up 4% as Wall Street Looks Past the Revenue Drop

TLDR

• XPeng reported a net loss of 1.78 billion yuan ($262.6 million) in Q1 2026, wider than estimates of 811.9 million yuan.
• Revenue fell 18% to 13.03 billion yuan as deliveries dropped by roughly a third year over year.
• Gross margin improved to 20.6%, up from 15.6% a year ago, a key bright spot for investors.
• XPeng stock rose 3.8% in premarket trading to $17.07 despite the miss.
• Q2 guidance calls for 100,000–106,000 deliveries and revenue of 19.60–20.80 billion yuan.

XPeng (XPEV) delivered a rough first quarter to start 2026, posting a net loss and a steep revenue decline, but the market focused on improving margins and better guidance — sending the stock up in premarket trading.

The Guangzhou-based EV maker swung to a net loss of 1.78 billion yuan ($262.6 million) in Q1, widening from 664 million yuan a year earlier. Revenue dropped 18% to 13.03 billion yuan. Both figures missed Wall Street expectations — analysts had pencilled in a loss of 811.9 million yuan on revenue of 13.55 billion yuan.

XPEV stock was trading up 3.8% at $17.07 in premarket on Thursday, even with the wider-than-expected miss.

XPeng Inc., XPEV

Deliveries came in at 62,682 vehicles, down from 94,008 in Q1 2025 — a drop of about a third. The fall snapped a run of consecutive record quarters and reflected a broader slowdown across China’s EV sector, where overall new car sales dipped around 7% in Q1 2026.

Margins Tell a Different Story

While the top and bottom lines disappointed, gross margin climbed to 20.6%, up from 15.6% a year ago. Vehicle margins improved to 12.1%, driven by cost cuts and a better product mix.

That margin improvement is likely what kept the stock from falling on the news. It signals that even as volume dropped, XPeng is getting more out of each car it sells.

Li Auto, which also reported Thursday, saw its stock fall 3.4% to $15.25 after similarly missing estimates. Li posted a per-share loss of 15 cents on revenue of $3.3 billion, versus expectations of a 13 cent loss on $3.2 billion. Deliveries edged up slightly to 95,142 vehicles, but revenue fell year over year.

Q2 Guidance Points to a Recovery

For Q2, XPeng is guiding for deliveries of 100,000 to 106,000 vehicles — roughly flat year over year — and revenue of 19.60 to 20.80 billion yuan. That would represent a meaningful sequential improvement from Q1’s weaker numbers.

Li’s Q2 delivery outlook was less encouraging, pointing to around 97,500 vehicles, down about 12% year over year.

Taken together with NIO, which reported separately, the three Chinese EV makers expect to deliver around 313,000 combined vehicles in Q2 — up 9% year over year and an improvement from the 5% growth rate seen in Q1. That’s a modest positive signal for the broader sector.

Coming into Thursday’s report, XPEV had fallen 19% year to date, which may have also helped soften the reaction to the miss.

Through April, Tesla sold roughly 139,000 vehicles in China, down 15% year over year, with TSLA stock down 1.6% in premarket at $433.51.

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