管理層發言
Good day, and thank you for standing by. Welcome to Lotus Technology, Inc. Fourth Quarter and Full Year 2025 Earnings Conference Call. Please be advised that today's conference is being recorded. I'd now like to hand the conference over to your first speaker today, Ms. Michelle Ma, Head of Investor Relations. Please go ahead.
Thank you, and welcome to Lotus Tech Fourth Quarter and Full Year 2025 Earnings Call. My name is Michelle Ma, the Head of Investor Relations here at Lotus. With me today are the CEO, Mr. Qingfeng Feng; and the CFO, Dr. Daxue Wang. Our conference call materials were issued today and are available on our Investor Relations website. We are also broadcasting this call via webcast. Before we continue, please be reminded that today's discussion will contain forward-looking statements pursuant to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company's actual future results may be materially different from the views expressed today. Further information regarding risks and uncertainties is included in Lotus Tech's relevant filings with the U.S. Securities Exchange Commission.
The company undertakes no obligation to update any forward-looking statements, except as required under applicable law. Please also note that our earnings press release and this conference call will include disclosure of unaudited GAAP financial information as well as other non-GAAP financial measures. You can find a reconciliation of measures in the press release available on our Investor Relations website at ir.group/lotus.com. With that, I'm delighted to turn the call over to our CFO, Dr. Wang, please.
Good morning, good afternoon and good evening to our shareholders, analysts and media friends. Thank you very much for joining us for Lotus Fourth Quarter and Full Year 2025 earnings discussion. I'm Daxue Wang, Chief Financial Officer of Lotus Tech, and it is my privilege to once again present the company's unaudited financial results. In the fourth quarter, the company delivered 1,108 vehicles, including 438 lifestyle vehicles and 670 sports cars. For the full year 2025, total deliveries reached 6,120 units, which represents a 64% year-on-year decrease. These figures reflect a transitionary year marked by the impact of tariffs, the phased start of upgraded model deliveries and intensified market competition. Total revenues for the fourth quarter were USD 163 million, a 40% year-on-year decrease. For the full year 2025, total revenues were USD 519 million, down 44% year-on-year. Sales of goods fell 48% year-on-year to USD 463 million, driven by lower sales volume, while services revenue surged 69% year-on-year to USD 36 million, primarily due to R&D service revenue.
The commercialization of our intellectual property through technical licensing and other channels has demonstrated significant market recognition of our pioneering technologies. Gross margin improved significantly to 10% in the fourth quarter compared to negative 11% in the same period of 2024. For the full year, gross margin improved to 9% from 3% in 2024. This improvement was driven by the global rollout of upgraded model deliveries, a favorable shift in our sales mix, improved inventory turnover dynamics and disciplined cost control. We continued our track record of disciplined cost management; operating loss narrowed by 65% year-on-year to USD 66 million in the fourth quarter. Consecutive sequential quarterly reductions in operating losses demonstrate the company's commitment to operational efficiencies. In fiscal year 2025, lifestyle vehicle deliveries accounted for 70% of the total, with sports cars making up the remaining 30%.
Deliveries were primarily driven by the China and European markets. By region, China accounted for 45% of full year deliveries, Europe 34%, North America 16% and the rest of the world 5%. In the fourth quarter of 2025, our sports car deliveries to North America showed remarkable quarter-on-quarter growth, even with a 5% local price increase. This was supported in part by the U.K.–U.S. tariff clarification, with U.K. auto imports to the U.S. now subject to a 10% tariff, which provided broader policy clarity. The recovery of sports car sales in the U.S. during the third and fourth quarters fully demonstrated our strong brand appeal and price acceptability in the region, driving a rebound in sales volume and gross profit margin. Research and development expenses were USD 171 million for the full year, down from USD 275 million in 2024, reflecting targeted prioritization of our technology investments.
Selling and marketing expenses decreased to USD 153 million from USD 322 million, and general and administrative expenses declined to USD 136 million from USD 227 million. These reductions underscore our strong commitment to enhancing regional efficiency. Together with increased gross profit in 2025, operating loss narrowed 46% year-on-year and net loss decreased 58% year-on-year. On a non-GAAP adjusted basis, adjusted EBITDA for the full year improved by 63% year-on-year, improving the adjusted EBITDA loss to USD 356 million from USD 961 million in 2024. Beyond these numbers, I would like to reiterate that we have reduced operating expenses for multiple consecutive quarters through value-added measures. Our improved margin performance in the fourth quarter and full year of 2025 demonstrated our continued focus on cost optimization and operational efficiency. This was also reflected in our significantly improved bottom line results.
Going forward, we expect the global launch of our PHEV model, For Me, to drive sales and revenue growth. Additionally, by combining a focus on revenue growth, maximizing product positioning and enhancing margins through strict cost discipline, we aim to progress towards profitability and deliver long-term value to shareholders. With that, I will now turn the floor over to Mr. Feng. Thank you.
Hello, everyone. This is Qingfeng Feng, CEO of Lotus Group. Thank you for joining the Lotus Technology Quarter 4 and Full Year 2025 Earnings Conference Call. Last year, 2025 was a really important year for us — a true turning point in our strategic transformation. Even with other global markets' ups and downs and higher tariffs, we made solid progress on our core operating metrics by staying focused on smart execution, pushing technological innovation and tightening how we run the business every day. I'll walk you through the latest developments in four key areas: recent highlights, market strategy, product lineup and the progress on our new hybrid model For Me. With our 78-year racing heritage, building the Lotus brand has always been front and center for us. In 2025, we scored some real breakthroughs on both the business and the brand front. In motorsports, we wrapped up our very first Lotus cars race event in Malaysia back in November last year.
A 44-lap race showcased the track and was a sensational expression of the brand's racing DNA. The 2026 season actually kicks off on April 3 of this year and we will keep using this platform to share our motorsports spirit and cutting-edge technology with fans everywhere. In equity financing, we secured a strategic investment of USD 23 million from ECAREX, deepening our global strategic partnership through capital support. Going forward, we will jointly accelerate innovation in next-generation intelligent cockpit ecosystems to deliver AI-driven experiences to consumers and collectively enhance product competitiveness. On the tech side, our Electrox model became the first Chinese-made electric vehicle to earn UN-R171.01 certification for highway navigation systems. Lotus is also only the second automaker in the world to achieve this, which is a huge validation of our advanced driver assistance systems and opens more doors in the premium European markets.
On brand development, we teamed up with a house designer for an exclusive showcase activation after the 2026 Milan Design Week. We showcased our industrial design philosophy and the progressive nature of the car, proving once again how Lotus blends technology and aesthetics in a way that feels luxurious and forward-thinking. For our market strategy, Lotus is continuing to refine our global footprint and make our channels more efficient. We now have a well-balanced distribution network across four major regions. As of the end of December, we had 211 sales outlets in Europe, 58 in China, 48 in North America and 38 in the rest of the world. In China, we kept expanding and upgrading our dealer network. We opened a new store in a city in China and refreshed several others. Dealers have been hiring more staff, adding more outlets and ramping up our online marketing, which has clearly improved both customer acquisition and satisfaction.
In North America, we plan to grow our Canadian dealer network based on existing channels. Now we have six dealers in Canada. We expect to expand to sell by the end of the year, taking advantage of local tariff policy opportunities. Electrox is the only Chinese-made electric vehicle priced above USD 80,000 that's fully certified for the North American market, so we expect strong sales growth there and we will start customer deliveries in Canada in May. In Europe, we streamlined our organization and regionalized operations and gave each region more freedom to tailor strategies to local needs. For example, we introduced business edition models and vehicle value production plans in Germany and expanded corporate and leasing business in the U.K. As I previously mentioned in the quarter three earnings conference call, we maintained discipline on costs. We are closing a few underperforming stores, expanding the high-performing ones and redirecting resources to the markets that are working best.
On our product line, we are improving product competitiveness by expanding both our range and powertrain options, playing to our strengths while fixing any gaps. The expansion and upgrading of the portfolio were core highlights of our work through the year. In 2025, new variants for key markets including EMEA were launched and delivered in major markets, receiving positive market feedback. The sales proportion of new models continued to increase, helping stabilize product sales. In 2025, we also focused on hybrid product development and in the first quarter of this year, we launched our all-new For Me and delivery started just one day after the launch. This hybrid model is attractive to mainstream luxury buyers and is a great option to reach markets that are moving more slowly towards full BEVs, like Italy, Spain and Saudi Arabia. It's also bringing in a broader mix of customers. In the future, we will keep strengthening both the sports and lifestyle vehicles in our lineup and we will roll out more hybrid models on our new hybrid architecture.
This gives consumers real choice — combustion, battery electric or hybrid — whatever meets their needs. And also allow me to share with you the progress of the launch of For Me, which is the first hybrid in Lotus's 78-year history. In the EU it is based on our new hybrid architecture. As I previously mentioned, this completely changes what the platform can do. For Me was launched in China on March 29, 2026, and deliveries began on March 30. Before the launch, we invited dealers and media outlets from the EU to test-drive this vehicle, and we received widely positive feedback. For Me runs on our ex-hybrid architecture: a 900-volt high-voltage platform paired with a 70-kilowatt-hour battery and a total output of 952 horsepower in CRTC testing, and it delivers more than 1,400 kilometers of total range under combined fuel and electric operation. Comprehensive fuel consumption is just 0.7 liters per 100 kilometers in WLTC.
Even when the battery is depleted, it's 6.1 liters per 100 kilometers. From 0 to 100 kilometers per hour, For Me in electric-only mode takes 3.3 seconds. Even when the battery is down to 10%, it still hits 3.5 seconds, so performance stays strong at low battery levels. Braking is equally impressive: stopping from 120 kilometers per hour in just 33.9 meters, and the car passed both international durability and braking tests after repeated heavy stops. At high speeds, the four-speed active rear wing functions as an air brake at 170 kilometers per hour, generating 120 kilograms of downforce to help shorten stopping distance and keep the car stable, bringing safety and driving confidence to drivers and passengers. Aerodynamics remain a Lotus signature. For For Me we carry forward our porous design language with low drag and functional aerodynamic surfaces; every line has a purpose to use airflow effects to boost downforce, and our wind tunnel testing showed effective aerodynamic performance.
We will gradually launch to the global market in the second half of the year: wholesale deliveries in EU states are targeted for the end of October; certification for For Me will wrap up by year-end with orders opening in October, official launch in November and deliveries in December. In the U.K., we expect wholesale to begin in mid-2027. Looking ahead, we will keep accelerating product updates and market expansion. On the one hand, we will ramp up four new global deliveries and at the same time advance R&D and the launch of new models as planned. On the other hand, we will deepen our channel partnerships and technical collaborations to make the Lotus name even stronger worldwide. Thank you again for your time and support. I will now hand it back to the host for your questions.
分析師問答
We will now take our first question from the line of Laura Lee of Deutsche Bank.
I want to ask about — just thinking about the total delivery rates of 2025. We actually went down year-on-year by almost half. So what are the main drivers of this volume decline in '25? And how should we think about the potential impact of geopolitical situation on future sales?
Yes, I do see there's a decrease — delivery volume decrease year-on-year, and it has been affected by a lot of elements. The first one is the uncertainty of tariffs. It has negatively impacted our production and also inventory. For example, the U.S.–U.K. tariff situation affected our volumes by about 60% in some channels. In addition to that, the EU and U.S. tariffs against Chinese-made EVs have also exerted pressure on our pricing in the EU. For the U.S. market, it has been very difficult for us to enter. Those influences also affected our inventory management and our destocking progress. We actively started destocking in 2025 and adjusted our product lineup. But after the adjustment, logistics also took some time and led to some later market entries. In 2025, our stock level has been reduced dramatically by 43% to a very healthy level and is a solid foundation for our 2026 plans. In addition to that, we've also adopted a lean, efficient organization to help us boost our profit margin.
Despite the negative impact of geopolitics and tariffs, we do see some new opportunities. For example, the U.K.–U.S. tariff issue has been settled and the U.K.-made vehicles to the U.S. are now charged a 10% tariff, which is beneficial news for our Emerald sales. The Emerald channels in the U.S. have recovered to a normal status. In addition, Canada has announced a policy change toward China-made EVs: tariffs will be lowered from previous levels to approximately 6.1%, which is conducive to our exploration in North America. Given we have already certified Electrox for the U.S., it's a good opportunity to leverage such changes to boost our sales volume. For our PHEV, the EU currently keeps a 10% tariff on Chinese-made PHEVs. So this is also a good window opportunity for us to launch PHEVs in October to EU markets. Despite the challenges that we've seen in the U.S. and EU markets, we do see positive feedback from the China market.
Our sales volume in China increased from about 2,800 to 2,900 units, an increase of 3% year-on-year. Actually, in 2025 the luxury market in China priced over RMB 400,000 dropped 4.4%, but in that circumstance we still achieved a 3% increase, which demonstrates that Lotus products are very competitive. We can achieve stable growth in a challenging year and the Lotus brand has been gradually recognized in the China market. In 2026, as we roll out the PHEV in different markets, it will help us to reach a wider market. For example, some markets with slower adoption of BEVs, such as Italy and Spain, will be receptive to PHEVs, and it also helps us touch a broader customer group who may be range-concerned. In the future, we are pretty confident that 2026 will be a year of recovery. In addition to that, we're also exploring new markets such as South America — Brazil — where we already have a dealer.
We expect a store to be opened in the middle of this year and the first batch of vehicles has been wholesaled. Again, in summary, despite negative influences last year, we see positive opportunities ahead. Thank you.
Okay. Great. Appreciate the color. Just to follow up on this volume perspective. So after the launch of Lotus For Me, the hybrid model, which I believe started release by the end of last month, could you provide an update on the current order intake and delivery programs? And could you elaborate more about the volume expectations and the strategic plans?
After the launch of For Me on March 29, dealer and market feedback has been encouraging. For Me is the first hybrid model of Lotus in our 78-year history and it redefines the hypercar-to-luxury spectrum to cover more scenarios, which allows us to reach a wider customer group. Our consumer inquiries have increased roughly fivefold in initial channels. On vehicle consultation platforms, For Me gained significantly greater visibility and ranked among top search and consultation results for vehicles in its price band. For PHEVs priced around RMB 400,000 in China, we see a clear trend of increasing penetration: in 2022 the segment was smaller, by 2024 it increased to around 280,000 units, and in 2025 it approached roughly 300,000 units, indicating strong market momentum. In other words, PHEV is timely for Lotus to capture additional demand. For Me helps Lotus reach a wider customer group: whereas our BEV offerings historically attracted younger buyers and entrepreneur-owner demographics, For Me is also attracting more senior managers and owners of premium SUVs such as the BMW X5.
We plan to launch For Me in the EU in the second half of the year; EU PHEV penetration is rising given stricter emission regulations and PHEV tariffs in the EU are currently lower than BEV tariffs for Chinese-made vehicles. There's an approximately 18.8 percentage point tariff difference between Chinese-made BEVs and the standard PHEV tariff level, and this differential provides an opportunity for PHEV launches. In markets such as Spain, Italy and Germany, PHEV demand is rising — for example, we saw strong month-over-month increases in key European cities late in 2025. Overall, For Me will help us create a more balanced product portfolio, offering customers more choices between BEV and PHEV and allowing Lotus to acquire more market share across a broader customer base.
We will now take our next question from Brian Lantier of Zacks Small-Cap Research.
It was really encouraging to see the improvement in gross margin going up to 9% for the full year and 10% in Q4. Obviously, services appear to have driven a lot of that. How recurring do you think that is? And do you have any guidance for 2026 gross margins?
Thank you, Brian. The company's gross margin improvement in 2025 was driven by three key factors. First, as Mr. Feng just elaborated, we successfully cleared aged vehicle inventories in the first half of the year; the second half saw a higher portion of new vehicle sales and a significant reduction in overall variable sales subsidies. Second, we continuously reduced material costs through a centralized procurement platform, which lowered component costs. Third, we increased the share of higher-margin service revenue, which lifted the overall gross margin. Looking to 2026, despite significant external headwinds such as continued price increases for car components like batteries and other key materials, which will put pressure on gross margin, we expect to maintain gross margin discipline through pricing, procurement savings and product mix improvements. At the same time, we expect to maintain overall production pricing at current levels while pursuing further optimization and efficiency, which we believe could lead to further gross margin improvement.
In addition, the ongoing collaboration and manufacturing synergies with our U.K. partners are expected to enhance production and R&D efficiency and further support gross margin growth. While we are cautious about component cost inflation, we remain confident that our initiatives on mix, services and procurement will support margin recovery in 2026.
Great. That's helpful. Obviously, operating expenses were cut significantly in 2025, which helped to narrow your operating loss. Could you talk about any key cost control measures that you've implemented? And whether you feel like they're sustainable in 2026?
Yes. Thank you. The company's cost control plan consists of structural long-term initiatives rather than temporary measures. On the R&D front, the company fully leverages group R&D resources, enabling us to reduce duplicate investment in general-purpose technologies and focus on differentiated technology development, thereby improving our R&D efficiency. On the marketing front, the company dynamically and flexibly manages its marketing plans to enhance marketing efficiency and better collaborate with partners. On the management front, the company strictly controls administrative expenses, streamlined organizational structure and optimized personnel management processes to improve operational efficiency. We believe these factors will continue to play a positive role in 2026 and that our cost reductions are sustainable because they are structural improvements, not one-off cuts. Thank you.
I'll now turn it back to the room for questions from the webcast.
Thank you for all questions on our conference call. We will now be answering investor questions via webcast. Our first question is: Service revenue grew 69% year-over-year in 2025. What is its core breakdown and the key drivers behind?
Yes, I'll take this question. The company's service revenue primarily consists of R&D service revenue and vehicle service income. In 2025, R&D service revenue accounted for over 75% of the total, with customers including first-tier OEM manufacturers. This fully demonstrates the market's strong recognition of the company's engineering and technical capabilities as well as the company's ability to commercialize our intellectual property.
Our second question from the webcast is: what's the implication that the risk of rising global oil prices has on the company?
Well, I think it's good news for new energy vehicles and a good opportunity for us, particularly for PHEV, because For Me, our first PHEV model, can be driven purely on gasoline, purely on battery, or a combination depending on consumer needs. Its fuel consumption is very low. As I previously mentioned, the comprehensive fuel consumption is only 0.7 liters per 100 kilometers in combined cycle; even at depleted battery status, fuel consumption is 6.1 liters per 100 kilometers. So overall, rising oil prices create a demand tailwind for electrified vehicles. This is a strong opportunity for us to capture market share, especially in markets such as the Middle East where charging infrastructure is not yet mature and BEV adoption is slower. In those markets, the PHEV model For Me is likely to play an important role. Of course, we do see some headwinds: hikes in oil prices can increase some logistics and supply chain costs, and established luxury OEMs may accelerate their PHEV launches to respond to market changes, which increases competition. We will remain differentiated in performance, customization and engineering to maintain our competitive edge.
That concludes the question-and-answer session. And with that, I'll now hand the conference back to Ms. Michelle Ma for her closing comments.
Thank you all again for joining us today. We will conclude the call now. The Investor Relations team remains available to answer any further questions you may have. Please feel free to contact us through the contact information on our website. Have a great day. Thank you.
Thank you for your participation in today's conference. This does conclude the program. You may now disconnect your lines.