Leapmotor First-Half Profit Surges 600% as Overseas Sales Expand

Leapmotor Reports Sharp Profit and Revenue Growth

Leapmotor reported a substantial improvement in first-half financial performance, with net profit surging 600% year-over-year to 210 million yuan ($30.95 million), marking the automaker’s second consecutive half-year of profitability. Net profit stood at 30 million yuan during the same period last year. Revenue increased 57.2% year-over-year to 38.11 billion yuan, supported mainly by higher vehicle and spare-parts deliveries. The company, backed by Stellantis NV, delivered 356,487 vehicles during the first half, representing a 60.8% year-over-year increase. Leapmotor said the sales result placed it first among China’s emerging auto brands by sales.

Higher Sales Have Not Fully Improved Earnings Quality

Despite the strong increase in deliveries, the expansion has not yet translated proportionally into stronger underlying earnings quality. First-half gross profit increased 29.7% year-over-year to 4.45 billion yuan, while gross margin narrowed to 11.7% from 14.1%. Leapmotor attributed the contraction to higher raw material costs and changes in its vehicle product mix. The second quarter provided a more positive signal, however, as gross margin reached 12.6%, an increase of 3.2 percentage points from the first quarter. The sequential improvement indicated that pressure on profitability had begun to ease.

Adjusted Profit and Cash Flow Remain Areas to Watch

The reported net profit increase also requires context because adjusted earnings moved in the opposite direction. Excluding share-based payments, first-half non-IFRS adjusted net profit fell 18.2% year-over-year to 270 million yuan. This indicates that the sharp rise in reported net profit was partly influenced by lower share-based payment expenses rather than solely by stronger operating profitability. Cash generation also weakened. Net cash generated from operating activities declined 24.1% year-over-year to 2.17 billion yuan, with Leapmotor saying that advance inventory stocking increased procurement spending. Free cash flow fell 83.7% to 140 million yuan from 860 million yuan.

Strong Liquidity Supports Expansion Plans

Despite weaker free cash flow, Leapmotor maintained a substantial liquidity position at the end of June. Cash and cash equivalents, restricted cash, time deposits and certain financial assets totaled 38.59 billion yuan. The balance provides the company with financial resources to support continued product development, production, market expansion and overseas growth. Research and development expenses increased 22.8% year-over-year to 2.32 billion yuan, reflecting continued investment in technology and products. Selling expenses also rose 41.1% to 1.99 billion yuan, mainly because of increased advertising and promotional activity and a larger sales workforce.

Overseas Expansion Becomes a Major Growth Driver

International markets are increasingly important to Leapmotor’s growth strategy, with first-half exports surging 372.6% year-over-year to 96,294 vehicles. Overseas deliveries represented 27.0% of total sales and had already exceeded the company’s full-year 2025 figure. Management said during the earnings call that overseas sales could reach approximately 200,000 vehicles in 2026. The company is targeting 350,000 to 400,000 overseas sales in 2027 and aims for the upper end of that range. The acceleration highlights the growing importance of international markets alongside domestic vehicle demand in China.

Full-Year Sales Target Requires Faster Delivery Growth

Leapmotor’s 1,000,000-vehicle full-year sales target will require a significant acceleration in deliveries during the remainder of the year. The company delivered 457,754 vehicles in the first seven months, equivalent to 45.8% of its full-year target. To reach the objective, Leapmotor needs average monthly deliveries of approximately 108,449 vehicles across the remaining five months. That required pace is above the record 101,267 vehicles delivered in July. The company is relying on new models, including the A10, D19 and A05, to narrow the gap. The D19 delivered 10,043 units in July, while the 100,000th A10 rolled off the production line 135 days after launch.

Assisted Driving Technology Expands Across the Lineup

Leapmotor is also expanding its assisted-driving capabilities across its vehicle portfolio as part of its broader technology strategy. The company said city navigation assistance is now available across its A, B, C and D series. It plans to extend nationwide city navigation assistance during the third quarter to models based on the LEAP3.0 architecture. Leapmotor also plans to introduce a new-architecture assisted-driving solution in September. These developments add a technology dimension to the company’s growth strategy, complementing its focus on vehicle deliveries, product expansion and international market development while increasing the capabilities offered across its model range.

Profit Growth Comes With Mixed Operating Signals

Leapmotor’s first-half results present a mixed financial picture despite the headline increase in reported earnings. Revenue and vehicle deliveries expanded rapidly, while overseas shipments became a significantly larger contributor to sales. At the same time, gross margin remained below the prior-year level, adjusted net profit declined, and both operating cash flow and free cash flow weakened. Higher research and development and selling expenses also demonstrate the costs associated with supporting future growth. The company therefore enters the second half with strong liquidity, expanding international operations and a broader product pipeline, but it must improve delivery momentum and earnings quality to sustain the pace of expansion.

Strategic Outlook

Leapmotor’s near-term performance will depend on whether new models can lift monthly deliveries enough to support its ambitious annual target while the company continues expanding overseas. The international sales trajectory is particularly significant because exports have already reached a level that exceeded the full-year 2025 figure. At the same time, restoring gross-margin performance and converting sales growth into stronger cash generation will remain important measures of operational progress. The company’s investment in research and development, assisted driving and new vehicle architectures indicates that it is continuing to build for longer-term growth. Its relationship with Stellantis NV also supports its international expansion strategy.

Frequently Asked Questions

What did Leapmotor report for first-half net profit?
Leapmotor reported first-half net profit of 210 million yuan, representing a 600% year-over-year increase and its second consecutive half-year of profitability. Revenue rose 57.2% to 38.11 billion yuan, while vehicle deliveries increased 60.8% to 356,487 units. However, adjusted non-IFRS net profit declined 18.2% to 270 million yuan when share-based payments were excluded. Gross margin also narrowed to 11.7% from 14.1%, showing that stronger reported earnings occurred alongside continued pressure on underlying profitability and cash generation.