Chinese electric car maker Li Auto (NASDAQ: LI) posted third-quarter revenue of RMB 2.511 billion, which was well above the market's expectations of RMB 1.925 billion. The company reported a net loss of RMB 107 million for the third quarter, which was below market expectations of a loss of RMB 502 million.
The company posted a non-GAAP net income of RMB 16.0 million (US$2.4 million) in the third quarter, compared with RMB 159.2 million Non-GAAP net loss3 in the second quarter of 2020, marking the first time it turned profitable.
Its gross margin was 19.8% in the third quarter of 2020, compared with 13.3% in the second quarter of 2020.
Li Auto delivered 8,660 vehicles in the third quarter and expects to deliver between 11,000-12,000 vehicles in the fourth quarter, up 27%-38.6% from the previous quarter.
Vehicle sales were RMB 2.46 billion (US$363.0 million) in the third quarter, representing an increase of 28.4% from RMB 1.92 billion in the second quarter of 2020.
Its vehicle margin went up to 19.8% in the third quarter, compared with 13.7% in the second quarter of 2020.
Free cash flow was RMB 749.9 million (US$110.4 million) in the third quarter of 2020, representing an increase of 149.3% from RMB 300.8 million in the second quarter of 2020.
The company's stock rose 18.5% in Friday's pre-market trading session after surging 27% on Thursday and traded at record levels in mid-afternoon trading.
Li Auto's trading volume jumped to 67.6 million shares at one point on Thursday, compared to its average trading volume of 11.6 million shares for the day.
Another electric car maker, NIO (NYSE: NIO), which is set to report third-quarter results on November 17, also rose 12 percent on Thursday. In Friday's pre-market trading session, NIO stock was up by 5%.
On Tuesday, Li Auto announced that the Li ONE became the No. 1 new energy SUV in China for the second month in a row and the No. 1 new energy midsize SUV for the 10th month in a row.
According to insurance registrations on November 10, the Li ONE registered 3,438 units in October and 22,160 units cumulatively for the January-October period.
Last Monday, Li Auto also announced its October delivery figures. The company delivered 3,692 vehicles in the month, a "steady increase" from the 3,504 vehicles delivered in September, and the third month in a row the company has set a new monthly delivery record.
From January to October 2020, 21,852 Li ONE vehicles have been delivered. The first model of the Li Auto, a large, six-seat premium electric SUV, was launched in October 2018, with mass production beginning on November 20, 2019, and deliveries to customers beginning in December 2019.
Following the October delivery results, Li Auto shares posted four consecutive sharp gains. From the end of September this year to Wednesday local time, the company's stock rose a total of 43.6%.
In comparison, shares of the company's Chinese competitor NIO rose 103 percent and XPeng's shares rose 67.1 percent over the same period.