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  Title	Earnings call transcript: Lotus Technology Q3 2025 shows improved margins
  ID	28270964
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  Published Date	Nov. 24, 2025, 7:11 a.m.
  Summary	Earnings call transcript: Lotus Technology Q3 2025 shows improved margins
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  URL	https://www.investing.com/news/transcripts/earnings-call-transcript-lotus-technology-q3-2025-shows-improved-margins-93ch-4375075
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  Content	Lotus Technology Inc. reported its third-quarter 2025 earnings, showcasing a notable improvement in gross margins despite a decline in vehicle deliveries and revenue compared to the previous year. The company's stock saw a slight increase, reflecting investor optimism about its future hybrid vehicle launches and strategic market expansions. According to InvestingPro data, Lotus stock is currently trading at $0.10, which appears undervalued compared to its Fair Value estimate, despite falling 36.73% over the past year. Key Takeaways Gross margin improved by 8% in Q3 2025. Vehicle deliveries decreased by 35% year-over-year but rose 28% quarter-over-quarter. Lotus plans to launch two new hybrid models starting in Q1 2026. The company is expanding into the Brazilian market. Company Performance Lotus Technology's overall performance in Q3 2025 indicated challenges with year-over-year declines in vehicle deliveries and revenue. However, the quarter-over-quarter growth in these areas, coupled with a significant improvement in gross margin, suggests that strategic initiatives are beginning to take effect. The company's focus on innovation and market expansion, particularly in the hybrid vehicle segment, positions it well against competitors in the premium automotive market. Financial Highlights Revenue: $137 million, down 46% YoY, up 10% QoQ Vehicle deliveries: 1,800 units, down 35% YoY, up 28% QoQ Gross profit: $11 million for Q3 Operating loss: $95 million, down 41% YoY Net loss: $65 million, down 68% YoY Outlook & Guidance Lotus Technology is optimistic about its future, with plans to complete the acquisition of Lotus UK in 2026 and implement the "One Lotus" global strategy. The company expects gross margins to remain in the high single-digit range, driven by the launch of plug-in hybrid electric vehicle (PHEV) products and the penetration of facelifted battery electric vehicle (BEV) models. Executive Commentary CEO Qingfeng Feng stated, "We will be the first to introduce such a model in the EU," highlighting the company's pioneering role in the hybrid segment. CFO Dr. Daxue Wang added, "Our gross margin for the full year is expected to remain at a high single-digit range," underscoring the financial strategy to enhance profitability. Risks and Challenges Continued decline in vehicle deliveries could impact future revenue. Market saturation in key regions may limit growth potential. Supply chain disruptions could affect production timelines. Economic fluctuations in target markets like Brazil pose risks. Competition in the premium EV market remains intense. Q&A During the earnings call, Laura Lee from Deutsche Bank inquired about the highlights of the upcoming PHEV models, while Dan Lin from CICC sought clarity on gross margin guidance. Management provided detailed insights, emphasizing the strategic rationale behind their hybrid model focus and margin improvement plans. Full transcript - Lotus Technology Inc (LOT) Q3 2025: Amber, Conference Operator: Good day, and thank you for standing by. Welcome to Lotus Technology Q3 2025 earnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one and one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please be advised that today's conference is being recorded. I'd now like to hand the conference over to your first speaker today, Ms. Michelle Ma, Head of Investor Relations. Please go ahead. Michelle Ma, Head of Investor Relations, Lotus Tech: Thank you, Amber. Welcome to Lotus Tech's Q3 2025 earnings call. My name is Michelle Ma, the Head of Investor Relations here at Lotus Tech. With me today are CEO Mr. Qingfeng Feng and CFO Dr. Daxue Wang. Our conference call materials were issued today and are available on our Investor Relations website. We are also broadcasting this call via webcast. Before we continue, please be reminded that today's discussion will contain forward-looking statements referring to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company's actual results may be materially different from the views expressed today. Further information regarding risks and uncertainties is included in relevant filings of Lotus Tech with the U.S. Securities and Exchange Commission. The company undertakes no obligation to update any forward-looking statements except as required under applicable law. Please also note that our earnings press release and this conference call will include disclosure of unaudited GAAP financial information as well as unaudited non-GAAP financial measures. You can also find a reconciliation of these figures in the press release available on our Investor Relations website at ir.group-lotus.com. With that, I'm delighted to turn the call over to our CFO, Dr. Wang. Please. Dr. Daxue Wang, Chief Financial Officer, Lotus Tech: Good morning. Good afternoon, and good evening, honored shareholders, analysts, and friends from the media. Thank you for joining us for Lotus's Q3 2025 earnings release. I'm Daxue Wang, Chief Financial Officer for Lotus, and it's my privilege once again to present the company's audited financial results. In the third quarter, the company delivered nearly 1,800 vehicles to distributors. This represents a 35% decrease year-on-year, but a 28% increase quarter-on-quarter. As a result, total delivery of the first nine months of the year reached 4,612 units, down 40% compared to the same period last year. These figures reflect a transitional period characterized by the impact of tariffs, gradual destocking activities, and the phased commencement of the gradually upgraded module deliveries. Revenue for the third quarter was $137 million, down 46% year-on-year, but up 10% sequentially. Revenues for the first nine months totaled $356 million, down 45% year-on-year. Gross margin improved 8% in the third quarter, up 3 percentage points from the previous quarter and 5 percentage points from the same period last year. This improvement was driven by a favorable shift in our sales mix towards upgraded models, reflecting healthy inventory dynamics and a continued recovery in our underlying profitability. The gross margin for the first nine months remained stable compared to the same period in 2024, safely in a positive territory. Now, allow me to break down our sales by category and regions. By category, lifestyle vehicles accounted for 77% of the total deliveries in Q3, down from 83% in Q2. Consequently, they contributed 72% of the total deliveries for the first nine months of the year. In terms of regions, deliveries in the U.S. sports car market began a gradual recovery in the third quarter. This improvement came after the initial U.S.-U.K. tariff disruptions were resolved, with U.K. vehicles ultimately securing a favorable tariff rate of 10%. Overall, deliveries in the first nine months of 2025 were primarily driven by China and Europe. It's worth noting that our delivery growth in China for the first nine months outpaced the broader premium auto segment in the country. This underscores the competitive strength of our product portfolio in an increasingly challenging environment. Now, let me turn to the key financials. As I have already covered, deliveries, revenue, and gross margin are perceived through other financial metrics. The cost of revenue decreased by 35% year-on-year to $126 million in Q3 and a total of $327 million for the first nine months of 2025. This resulted in a gross profit of $11 million for the quarter and $29 million for the first nine months. We reported an operating loss of $95 million in the third quarter, a 41% improvement year-on-year. The net loss for the quarter was $65 million, a 68% improvement year-on-year. For the first nine months, the operating loss was $357 million, narrowing by 40% year-on-year, while the net loss narrowed to $378 million, down 43% year-on-year. At four-year reference, on a non-GAAP adjusted basis, the net loss for the first nine months was $2 million lower, primarily due to the impact of the share-based compensations. Adjusted EBITDA under the non-GAAP for the same period narrowed by 48% year-on-year to $294 million. Beyond these numbers, I would like to reiterate that we have now reduced operating expenses for eight consecutive quarters through value-added measures. This underscores our strong commitment to enhancing operational efficiency. Our efforts in cost discipline and inventory optimization are reflected in the significantly narrowed loss for both the quarter and the year to date. We remain focused on prudent resource allocation and margin enhancement while also preparing for a more dynamic operating environment in the quarters ahead. During the third quarter, we achieved several key milestones amid challenges posed by the fierce market competition. We will be unveiling our new PHEV model in the coming months to further expand our electrification product roadmap and address consumer demand in diversified powertrain segments. Our CEO, Ms. Feng, will elaborate further on these developments. With that, I will now turn the floor over to Ms. Feng. Thank you. Qingfeng Feng, Chief Executive Officer, Lotus Tech: 各位朋友，大家好。我是 Lotus 冯庆峰。感谢大家参加 Lotus 科技 2025 年第二季度业绩电话会。现在我从几个方面向大家介绍一下公司的近况。第一个是近期品牌发展的一些亮点，第二个市场战略，第三产品矩阵，第四是英国 Lotus 的整合情况。 Good morning, good afternoon, everyone. I'm Feng Qingfeng, CEO of Lotus Tech. Thank you for joining the Lotus Tech Q3 2025 earnings call. Now I'd like to walk you through the company's latest progress across four key areas: recent highlights, market strategy, product portfolio, and the acquisition of Lotus UK. 作为有 77 年赛道基因的 Lotus 品牌，持续强化这种全球品牌的形象非常重要。那么今年 9 月 5 日，莲花亮相了 2025 年德国的 IAA 车展，展出了概念车 Zero One Electric Emeya Himera，展示了莲花将品牌传承、创新科技与电动化战略的完美融合。 For Lotus, with a 77-year track DNA, it is important to keep enhancing its global image. On September 5, Lotus made a strong appearance at IAA Mobility 2025 in Germany, showcasing the concept car Series One, Electric Emeya, and Himera, demonstrating a seamless blend of brand legacy, cutting-edge technology, and electric strategy. 作为这种赛道的基因，从今年 6 月份我们开始举办了莲花杯单一品牌赛。参赛阵容是国际化的。那么第三站在成都已经顺利完成。那么接下来之后，也就是这个月，我们将会在马来西亚雪邦国际赛道决出年度总冠军。 To carry over Lotus' racing track DNA, the 2025 Lotus Cup One Lake Racing Series kicked off in June, featuring an international lineup of drivers. The third round concluded successfully in Chengdu, with the season finale set to take place in Sepang International Circuit in Malaysia this month. 9 月 14 号，伦敦在伦敦设计节期间，莲花作为官方汽车合作伙伴，在伦敦梅菲尔展厅开幕了一场沉浸式的展览，探讨了莲花品牌的设计基因，取得了良好的反馈。 On September 14, during the London Design Festival, Lotus served as the official automotive partner and opened an immersive exhibition at her Mayfair showroom, exploring the design DNA of the brand and received positive feedback from the public. GT4 race car. It also enhanced consumers' understanding and appreciation of our sports car products and further strengthened the inheritance of our racing DNA. On November 16, driver Lu Wenlong and Liu Kai Shen, pilots of the Himera GT4, took name, the first and third place in the Macau Grand Prix Great Bay Area GT Cup. This marks back-to-back podiums for the Himera GT4, following its first and second place finish in the same event in 2023. The Macau Circuit, known for its long straights and tight twisting corners, is regarded as one of the most challenging street circuits. This double podium not only highlights the driver's exceptional skill but also underscores the outstanding performance and reliability of the Himera GT4. It strengthens customers' trust and enthusiasm of our sports car, and also it carries over Lotus' racing track DNA. and 40 in other regions. The distribution across the four major sales regions is still very balanced, covering 45 markets globally. For market strategy, Lotus continues to optimize our global presence and enhance our retail efficiency. As of the end of September, we had 213 retail stores worldwide, with a well-balanced distribution across four key regions. Europe, we had 70 shops, China 54, North America 49, and other markets 40. Those cover roughly 40-45 markets globally. 除了提升渠道，完善渠道之外，更重要的一点，我们还不断地在完善降本增效的方式，从而提升渠道的效率。我们加强成本的控制，对门店进行成本结构调整，将高成本的中心店进行一些变换，关闭一些低效的商超店，拓展高效的门店，提高销售成交率的同时，降低门店的运营成本。 Besides the retail channel efficiency improvement, we've also explored other measures to reduce our costs and improve our efficiency. For example, we've implemented prudent cost-to-country measures and optimized our store portfolio. This includes relocating high-cost stores, closing underperforming locations, and expanding high-efficiency outlets. It helped boost our conversion rate while reducing operating costs. 同时，我们将欧洲的总部从荷兰迁回到英国，进一步降低运营费用，也更好地将资源进行整合，使莲花回归到出生地，可以更好地讲好莲花品牌的故事，同时也覆盖到整个欧洲和全球。这个可以让我们也提升更高的效率。 In addition to that, we've also relocated our European headquarters from the Netherlands back to the U.K., cutting operational expenses and allowing us to focus resources on key markets. Returning to Lotus' birthplace also helped us better tell the brand story and strengthen our reach across Europe and beyond. Such measures further improve our overall efficiency. 也要发展，我们也要进入一些新的市场，比如说巴西。巴西是全球的第七大单一市场，2024 年的时候销量是 200 万台，新能源的渗透率是 8%。2025 年 1 到 9 月整体销量为 144 万台，新能源的渗透率提升到了 10%。我们也计划进入这个市场。 We are also preparing to enter new markets, starting with Brazil. Brazil is the seventh automotive sales country in 2024. The total sales is roughly around 2 million, with a new energy vehicle penetration rate around 8%. In the first nine months of this year, the total sales reached 1.44 million units, with a penetration rate of new energy vehicle increased to 10.1%. The proportion of new version sales continues to increase. As for our product portfolio, two years ago we had already planned on that. Actually, we've already launched our hybrid technology, and we believe all of you will soon see the fruits. For Lotus, we currently offer two models globally, including Himera Electric and Emeya, all of which were updated in 2025. The new version has all been well received, with a share of total sales continuing to grow. 基于我们的超级混动路遥超级混动技术，后续我们将推出两款新的车型。第一款超级混动车型我们预计将在一季度中国发布。我们会在 1 月份的时候举办产品的技术发布会，欧洲也将陆续会发布。 We plan to introduce two additional hybrid models based on our new architecture. The first hybrid model is set to launch in China in quarter one next year, with a dedicated technology preview event in January. A European release will follow. 这款车型还是继承了莲花的 DNA，关于操控需要超好的操控，也有莲花工程，有 70 多年历史的工程来进行调教。同时也会标配双枪双阀的空悬，标配 48 伏的主动稳定杆，将会成为这个车型在操控方面我们会进一步的加强。同时路遥，根据路遥的架构，我们可以实现超过 1,000 多公里的续航，还有具有 900 匹马力的高性能。它还继承了莲花的一贯传承的设计，车型具有极致的宽高比，延续莲花的家族基因。 The new hybrid also carried over and inherited Lotus DNA in the following areas. The first is its ultimate handling. Thanks to Lotus' tune engineering, it is also equipped with a dual-chamber air suspension and a standard 48-volt active stabilizer. It can be capable of a long range and also high performance. It is enabled by the latest architecture, delivering over 1,000 km of range and 952 horsepower. It also inherited the inspired design, featuring the sensational width to height proportion of our Hyperkai Vaya, staying true to Lotus' design DNA. 超级混动的推出拓宽了我们的产品线，也让主流豪华用车人群有更多的选择，也将进一步扩展莲花的市场覆盖，进入更广泛的市场，比如纯电进展比较慢的市场，在欧洲有意大利、西班牙，在中东有沙特等等，这些更广泛的地区也能够得到更广泛的人群的喜爱。 The introduction of the hybrid models offers more choice for luxury vehicle buyers and will help us to expand into broader markets, including regions with slower EV adoption, such as Italy and Spain and Saudi Arabia. It will also help us to attract new customer segments. 下面我们可以介绍一下英国 Lotus 的整合情况。公司正稳步推进对英国 Lotus 的收购工作，此次收购预计将于 2026 年完成。 For the acquisition of Lotus UK, we are now making steady progress on the merger of the acquisition of Lotus UK, which we expect to complete in 2026. 收购完成后，公司将秉承 One Lotus 战略，保持全球统一的高性能超豪华品牌调性，通过单一清晰品牌身份强化全球品牌认知度，最大化品牌的传承。 After the acquisition, we are going to operate under our One Lotus strategy. We plan to maintain a consistent global identity as a high-performance premium luxury brand to strengthen worldwide recognition and maximize our heritage. 收购完成后可以更好地优化组织架构，实现更快速、更清晰的决策链条，提升整体水平，建立全球统一的治理架构，遵循全球统一加区域适配的业务规则，提升公司治理质量，从而更好地制定并实施中长期战略。 We are also streamlining reporting lines to enable faster, clearer decision-making. A globally aligned governance model, global standards with regional adaptation, it will improve oversight and support medium to long-term strategy execution. 在业务方面，全球业务整合方面，会整合全球研发体系的统一管理，提升研发效率，深化技术研发成果的共享共用，降低开发成本，缩短开发周期。在采购方面，实现生活用车与跑车的成本优化，降低生产成本，可以统筹仓储物流，降低配件仓储物流的各种成本，也统一销售渠道，全球管理体系等环节，消除重复投入与资源分配，实现品牌价值与运营效率的双提升。 For our business integration, we are driving synergy across key areas. On R&D, we consolidate global engineering under one team to improve efficiency, share technology, and accelerate new vehicle development. On purchasing, we leverage shared sourcing to reduce costs across lifestyle vehicles and sports cars. On logistics, we will optimize warehousing and parts distribution to further lower costs. We have also aligned channels and systems globally to eliminate duplication and boost brand value and operational effectiveness. 非常感谢大家。接下来把时间交给线上的朋友，看看大家有没有什么问题。 Thank you. We will now open the line for your questions. Amber, Conference Operator: Thank you. We will now begin the question and answer session. As a reminder to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. For the convenience of everyone on the call, if you wish to ask your questions in Chinese, please translate your questions to English right away. We will now take our first question from Laura Lee from Deutsche Bank. Please go ahead, Laura. Hey, thank you for taking my question. Could you elaborate a little bit more about the key highlights of the upcoming PHEV models and maybe talk more about the strategic rationale behind those products? Qingfeng Feng, Chief Executive Officer, Lotus Tech: 非常感谢。我先谈谈我们车型的几个亮点吧。我们把这个产品定位为超混超架构的SUV，具备三大的全球第一，是全球最高的热效率的发动机，全球最强的双电机的混动系统，同时具备全球功率最高的发电机。这是它非常强的一个亮点。完全继承了莲花的既有操控又有高性能的特性。 Thank you for your question. First, allow me to elaborate on the highlights or the features of our hybrid model. It features three firsts. It has the best energy-efficient engine and also the two best performance hybrid systems and also the highest power motor. Those three features demonstrate Lotus' DNA from both a handling and also performance perspective. 关于如何把操控做得更好，把超混架构应用得也更好，我们会在1月份的时候进行技术发布会，会完整地解读我们这款产品的最大亮点。 As for the details about how to further enhance its handling and performance, as well as the details of our hybrid architecture, please stay tuned to our tech preview event in January. 我先从市场来给大家做一个解读和分析。先说中国市场。在中国豪华车市场中，插混和增程车型占比非常高，增速也非常快。中国40万以上的新能源车型中约70%为插混加增程这样的车型。增程这样的车型，我们也把它作为带有发动机特性的一些产品放进来，来看增长的话，40万以上的新能源的渗透率快速地提升，1到9月份已经达到了43%。插混加增程的渗透率已经超过了30%。 Also, we would like to elaborate on the strategic rationale behind our hybrid model, but first I'd like to start with the market. For China market, the premium vehicle market in China, including plug-in hybrids and extended ranges, makes up a large and rapidly growing segment. Among new energy vehicles priced above CNY 400,000, about 70% are plug-in or extended range models, and their growth is a major driver of the broader new energy vehicle expansion. The penetration rate of new energy vehicles in this price bracket has also risen quickly, reaching over 40% from January to September. Within that, plug-in and extended ranges accounted for more than 30%. 同时在中国的豪华混动一级SUV，我们讲50万级以上的，相较于豪华纯电一级SUV，竞争还不充分。我们将会成为这个级别的第一个插混车型，且目前的主销车型都是偏重于商务和越野的。这为莲花的超级混动车型推出来提供了很大的想象空间，也有一定的市场空间。 The competition in China's premium E-segment hybrid SUV is still relatively underdeveloped. The premium E-segment hybrid SUV means the price over CNY 500,000, and the development is relatively underdeveloped compared to the battery electric E-segment SUV space. Most current models also lean heavily toward business or off-road use. This creates a clear opening for Lotus to introduce our hybrid models. 欧洲市场的话，在欧洲的混动车型占比比较高，增速也非常快，市场巨大。随着排放要求越来越严格，欧洲新能源的渗透率和中国一样地在快速提升。 In Europe, hybrid models represent a large, faster growing share of the auto market. As emission standards tighten, new energy vehicle adoption is accelerating in Europe, just as it is in China. 如果说从宽泛的来看的话，就是我们新能源纯电PHEV加HEV来看的话，欧洲1到9月的已经渗透率已经达到了60%。尤其新能源车型中的PHEV和HEV的车型占到了73%。 From January to September this year, NEVs, including battery electric vehicle, plug-in electric vehicle, and hybrid electric models, reached 59%-60% of the total market. Among those NEVs, PHEV and HEV together accounted for about 73%. 插电混动车型在欧洲增长还是非常迅猛的，截止到9月份已经连续7个月同比增长，且在欧盟地区9月同比增速达到了65%。 Notably, plug-in hybrids, the PHEV sales, have surged in Europe. As of September this year, PHEV sales have grown year over year for seven consecutive months, with EU-wide sales up 65% in September alone. 尤其像我们这样在超级混动的豪华细分市场内，这样的一个超级混动车型，我们在欧洲将会是第一个推出这样的一个车型。上周我到欧洲去做市场调研的时候，我们的经销商对我们这样的一个车型表示出了巨大的兴趣。接下来我们也会邀请欧洲的经销商，邀请欧洲的媒体来充分体验和试驾我们的车型。 In the premium hybrid segment, Lotus will be the first one to introduce such a model in the EU. Last week, I visited the EU, and I heard the positive feedback from our dealers when they know about this hybrid model. In the successive phase, we are going to invite dealers and also medias to have an in-depth test of our new models. 谢谢大家。 Thank you. Okay. Appreciate the color. Yeah, looking forward to the launch. Amber, Conference Operator: Thank you. Our next question comes from Dan Lin from CICC. Please go ahead, Dan Lin. Hello. This is Dan Lin from CICC Auto team. Thanks for taking my call and congrats on your sequential improvements. I have one question about your gross margin. Do you have any guidance on your gross margin for this year and next year? Dr. Daxue Wang, Chief Financial Officer, Lotus Tech: Hi, Dan Lin. Thank you so much for your question. With the recovery of the vehicle gross margin in the second half of the year, our gross margin for the full year is expected to remain at a high single-digit range. Looking ahead, our gross margin is projected to further improve, primarily due to the following factors. First, the launch of the PHEV products, which is based on our loyal architecture, will further reduce the per-unit vehicle costs and achieve higher gross margins. Second, as the BEV facelifted products penetrate global markets, their sales are expected to increase, thereby boosting the gross margins. Third, the implementation of the put option with Lotus UK will further enhance efficiency. For instance, the manufacturing segment's gross profit will be consolidated into the listed companies. The economies of scale resulting from the integration of the supply chain and research and development will contribute to higher gross margins. I think for the next year, we have confidence it's going to be higher than this year. Thank you so much. Thank you. That's all from me. Very clear. Thank you. Amber, Conference Operator: Thank you. I am showing no further questions at this time. With that, I'll now turn the conference back to Ms. Michelle Ma for her closing comments. Thank you all again for joining us today. We will conclude the call soon. The investor relations team remains available to answer any further query you have. Please feel free to contact us through the contact information on our website. Have a great day. Thank you. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect your lines.
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