Why Is XPeng (XPEV) Stock Down 6% Today?

  • XPeng (NYSE:XPEV) reported its Q1 earnings today
  • The Chinese electric vehicle (EV) company delivered 34,561 EVs during the quarter
  • However, weak guidance is hurting XPEV stock today
Xpeng logo and P7 model in store XPEV stock
Source: Andy Feng / Shutterstock.com

Shares of XPeng (NYSE:XPEV) are down more than 6% after the Chinese EV company reported its Q1 earnings. Revenue came in at $1.17 billion, up 152% year-over-year (YOY), while analysts were expecting $1.1 billion. Meanwhile, earnings per share (EPS) came in at a loss of 28 cents, compared to the EPS analyst estimate of a loss of 30 cents. XPeng remains unprofitable, posting a net loss of $268.3 million, compared to a net loss of $118.24 million a year ago.

While revenue and EPS beat estimates, guidance was a bit on the weak side and is responsible for XPEV stock’s decline today. Let’s get into the details.

Why Is XPEV Stock Down Today?

For Q2, the company expects revenue to fall between $1.02 billion and $1.13 billion. However, that range is lower than the analyst estimate of $1.25 billion. On top of that, XPeng expects 31,000 to 34,000 EV deliveries during Q2. This would imply between 22,000 and 25,000 deliveries during May and June. In April, it delivered 9,002 EVs. XPeng’s April deliveries beat out competitors Nio (NYSE:NIO) and Li Auto (NYSE:LI).

During Q1, the company delivered 34,561 EVs, up 159% YOY. During Q4 of last year, it delivered 41,751 vehicles. As a result, investors are not pleased with the quarterly slowdowns in deliveries.

XPeng faced a plethora of headwinds during Q1. The Chinese Lunar New Year holiday occurred last February, which slowed down sales as citizens celebrated with family and friends. Furthermore, China’s uptick in coronavirus cases and the subsequent lockdowns contributed negatively to deliveries and supply chain logistics as well.

What’s Next for XPeng?

Despite the numerous challenges ahead, CEO He Xiaopeng remains excited for XPeng’s future opportunities. He commented, “Superior in-house technology development capability and proactive supply chain management enabled us to address supply chain challenges more efficiently. We remain confident in expanding our market share despite the impact of semi-conductor shortage and COVID-19.”

Xiaopeng also stated that XPeng’s “strategic goal” is to make advanced driver-assistant systems (ADAS) safer and more affordable for the everyday customer. The company has a goal of developing a “full scenario” ADAS that demonstrates a high level of safety. In addition, the CEO would like to leverage economies of scale and continue to improve operating efficiency.

On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Article printed from InvestorPlace Media, https://investorplace.com/2022/05/why-is-xpeng-xpev-stock-down-6-today/.

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