Li Auto, once China's poster child for profitable EV making, posted an operating loss of 520 million yuan ($75 million) in 2025. Just a year earlier, the company had booked 7 billion yuan in operating profit.
Revenue: -22.3% to 112.3 billion yuan ($16.3 billion).
Deliveries: -18.8% year-on-year.
The details
The slide happened fast. In 2023 and 2024, Li Auto was one of the few profitable EV makers in China, with operating profits of 7.4 and 7 billion yuan respectively.
The MEGA disaster: In March 2024, Li Auto launched its first all-electric model. The minivan flopped. In July 2025, a crash-test video of the i8 turned into a PR nightmare. The pure-electric push ate into margins and credibility.
Q4 shows early stabilization:
Net income: 20.2 million yuan (after Q3 losses).
Vehicle margin: 16.8% (Q3: 15.5%, but Q4 2024: 20.3%).
Free cash flow: back to positive at 2.5 billion yuan.
The full-year picture tells a different story: Operating cash flow swung from +15.9 billion yuan (2024) to -8.6 billion yuan. Free cash flow dropped from +8.2 to -12.8 billion yuan.
The cushion holds: Li Auto is sitting on 101.2 billion yuan ($14.7 billion) in cash. Enough to fund a turnaround without going back to capital markets.
The AI pivot
In November 2025, CEO Li Xiang officially declared the company an “Embodied Intelligence” firm. Half of its 11.3 billion yuan R&D budget is now being allocated to AI.
In January 2026, the engineering teams were reorganized, including the creation of a new humanoid robotics division. For 2026, Li Auto is planning 12 billion yuan in R&D spending, with around half going to AI, chips, and autonomous driving.
Li Xiang himself has called 2026 “the most competitive year” in China’s premium segment. Even so, he is still targeting 20% sales growth in the core auto business.
👉 Sources: Caixin, Kr Asia
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