The electric vehicle maker impressed investors by reporting its deliveries doubled last year, as it achieved its first-ever annual profit

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Key Takeaways:

Leapmotor recorded an annual net profit of 540 million yuan last year, as its revenue doubled and its other key metrics performed strongly

The electric vehicle maker led the field among China's new energy vehicle startups last year

The innovation road has never been easy to travel, despite Beijing's constant refrain calling on companies to innovate. But after a decade on a road stained with copious red ink, electric vehicle (EV) maker Zhejiang Leapmotor Technology Co. Ltd. (9863.HK), which once had trouble simply meeting its payroll, has finally crossed into the rare lane of profitability, something only a handful of its peers have done.

The company's 2025 results, released last week, contained multiple milestones. At the top of that list, Leapmotor achieved its first annual net profit of 540 million yuan ($78 million). Its full-year vehicle deliveries totaled 596,555 units, up more than 100%, making it the leader among China's new energy vehicle startups in terms of sales volume. What's more, the company was the only startup to achieve monthly deliveries exceeding 70,000 units.

All of Leapmotor's key metrics showed significant growth. Its revenue doubled year-on-year to 647.3 billion yuan, while its gross margin hit a record 14.5%, up 6.1 percentage points compared with 2024. The company's net operating cash flow reached 126.2 billion yuan, up by nearly 50% year-on-year.

Winning through affordability

Leapmotor's ability to outperform peers like Nio (NYSE:NIO) (9866.HK) and XPeng (NYSE:XPEV) (9868.HK) and to rapidly close the gap with Li Auto (2015.HK) (NASDAQ:LI), largely owes to its strategy of achieving big sales through competitive pricing. The company's main models are priced between 60,000 yuan and 200,000 yuan each, with an average price of around 150,000 yuan, or about $21,700. That approach helped Leapmotor, once considered a dark horse in a weak Chinese economy plagued with intense competition, to come from behind and sprint to the lead of the pack in terms of units sold.

Concurrently, ...