Li Auto's Chief Financial Officer, Li Tie, stated that 2023 marked the company's first year of achieving profitability and healthy earnings.
Recently, Li Auto (2015:HK; LI:NASDAQ) released its financial report for the fourth quarter and full year of 2023. Thanks to rapid expansion and sustained operational efficiency, Li Auto achieved its best financial performance in its history during the reporting period.
In the fourth quarter, revenue reached CNY 41.73 billion, a 136.4% year-on-year increase, with quarterly deliveries of 131,805 vehicles, up by 184.6% year-on-year. The annual revenue reached CNY 123.85 billion, reflecting a 173.5% year-on-year growth, with annual deliveries of 376,030 vehicles, a 182.2% increase year-on-year. Consequently, Li Auto became the first new energy vehicle company in China to achieve annual revenue exceeding CNY 100 billion. Following the success in 2023, the company's Chairman and CEO, Li Xiang, set the sales target for the new year at 800,000 vehicles.
Regarding gross margin, data shows that Li Auto's quarterly gross margin continued to improve, reaching 20.4%, 21.8%, 22.0%, and 23.5% in the four quarters of 2023, with an annual gross margin of 22.2%. This gross margin performance even surpassed that of Tesla. Tesla recently announced its 2023 financial report, indicating a gross margin of 18.2%.
As of the end of 2023, the company had 467 retail centers covering 140 cities and operated 360 after-sales service centers in 209 cities. In 2024, the target number of retail centers is set to increase to 800.
In terms of free cash flow, Li Auto stated in its financial report, "Our cash position increased by 75.1% from CNY 59.21 billion as of December 31, 2022, to CNY 103.67 billion as of December 31, 2023." As of the end of 2023, the company's cash reserves amounted to CNY 103.67 billion, indicating a healthy financial position. With ample cash reserves and a healthy operating model, Li Auto continues to increase its investment in research and development.
The financial report data reveals that in the fourth quarter of 2023, Li Auto's R&D expenses amounted to CNY 34.9 billion, marking a 68.6% year-on-year increase. Moreover, its annual R&D expenses reached a historical high of CNY 105.9 billion, representing a 56.1% year-on-year growth. With the increase in R&D expenses and the structural layout of platform-based and systematic R&D, Li Auto's technological capabilities in the areas of intelligence and electrification have continued to improve. Throughout the year, a total of 20 OTA upgrades were released, elevating the product experience in intelligent driving, intelligent space, and intelligent electric power to an industry-leading level.
Additionally, in the first quarter of 2024, Li Auto's performance outlook is set to reach a new high for the same period, with an expected delivery volume of 100,000 to 103,000 vehicles, representing a 90.2% to 95.9% year-on-year growth; and revenue ranging from CNY 31.25 billion to CNY 32.19 billion, reflecting a 66.3% to 71.3% year-on-year increase.
Li Auto stated that with ample cash reserves and continuously improving self-financing capabilities, the company will support ongoing increases in R&D investment, expansion of business scale, and the realization of its vision to become a global leader in artificial intelligence by 2030.
As of the time of publication, Li Auto's Hong Kong stock was priced at HKD 174.80 per share, with a total market value of HKD 348.2 billion; its US stock was priced at USD 45.29 per share, with a total market value of USD 48.053 billion.