A BYD Seal 07 on display at the Beijing Auto Show in April 2026. Credit: CnEVPost
- Overseas expansion lifted gross margin to 18.85%, but NEV weakness and foreign-exchange losses weighed on profit.
- BYD’s first-half revenue fell 7.13% to 344.82 billion yuan.
BYD (HKEX: 1211) reported declines in both revenue and net profit in the first half, as weakness in its automotive business and foreign-exchange losses offset strong overseas growth.
The company said on Friday that first-half revenue fell 7.13% year-on-year to 344.82 billion yuan ($50.9 billion).
Net profit attributable to the company’s shareholders dropped 20.54% to 12.33 billion yuan.
BYD attributed the revenue decline mainly to weakness in its new energy vehicle (NEV) business. Foreign-exchange losses resulting from currency fluctuations also weighed on profit.
Revenue from automobiles and related products and other products fell 8.98% to 275.34 billion yuan, accounting for 79.85% of the group’s total revenue.
Revenue from electronics and other products rose 0.96% to 69.41 billion yuan, representing 20.13% of total revenue.
Weak sales were the main drag on financial performance. BYD sold 1,808,511 NEVs in the first half, down 15.72% year-on-year.
The decline narrowed significantly in the second quarter, however. Sales totaled 1,108,048 units in the second quarter, down 3.24% year-on-year, compared with a 30.01% decline in the first quarter.
Overseas markets continued to provide growth momentum. BYD exported about 792,000 vehicles in the first half, up 67.8% year-on-year and equivalent to about 44% of its total sales during the period.
Second-quarter overseas sales reached 471,091 units, up 82.46% year-on-year and 46.68% from the previous quarter.
Growth in the overseas NEV business improved profitability. BYD’s first-half gross profit fell 2.81% to 64.99 billion yuan, but its gross margin rose to 18.85% from 18.01%.
Combined sales of the group’s higher-end brands, including Denza, Fang Cheng Bao and Yangwang, rose 61.0% year-on-year. Their share of the group’s passenger-vehicle sales increased to 12.8%.
BYD also maintained heavy spending on research and development. First-half R&D investment totaled about 28.9 billion yuan, equivalent to about 2.3 times its net profit for the period, while cumulative R&D spending exceeded 270 billion yuan.
Operating cash flow fared better than earnings. First-half cash inflow from operations rose 17.3% year-on-year to 37.34 billion yuan.
Overseas expansion also lengthened the inventory turnover cycle. Inventory turnover days increased to 109 from 79 a year earlier, which the company attributed to overseas business growth and longer shipping times.
BYD’s sales improved further early in the second half. July sales rose 21.76% year-on-year to 419,211 units, marking the third consecutive month of growth.
Overseas sales of passenger vehicles and pickup trucks reached a record 179,841 units in July, up 124.3% year-on-year and accounting for about 43% of total sales for the month.
BYD management expressed confidence in achieving 1.5 million vehicle exports in 2026.
($1 = 6.7811 yuan)
