Chinese electric vehicle maker Xpeng forecast third quarter revenue below Wall Street expectations on Monday, as intense competition and weak domestic demand weigh on the world’s largest auto market.
Xpeng expects revenue of between 21.7 billion yuan ($3.23 billion) and 23.4 billion yuan for the third quarter, well below analysts’ average estimate of 26.61 billion yuan, according to LSEG data.
The company’s U.S. listed shares fell 3.1% in premarket trading, putting them on course to extend losses of about 40% this year through Friday.
Xpeng delivered 103,295 vehicles in the second quarter, within its previous forecast range of 100,000 to 106,000 units. However, its net loss attributable to ordinary shareholders widened to 1.34 billion yuan, significantly exceeding analysts’ estimated loss of 511.8 million yuan.
Xpeng Vice Chairman and Co President Hongdi Brian Gu said the company’s operations remained resilient despite industry wide cost pressures.
Chinese automakers are facing declining domestic sales, weak consumer demand and years of aggressive price competition. Excess production capacity has also pushed manufacturers to expand exports and seek growth in overseas markets.
Xpeng recently recalled 264,842 electric vehicles as part of a wider Chinese recall involving about 4.3 million vehicles over concerns related to emergency door releases.
The company has also been expanding beyond electric vehicles. Last month, it launched the MONA L03 AI SUV coupe, while its robotics division raised more than $900 million in its first funding round, reportedly the largest single private financing in China’s embodied AI sector.
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