XPeng Sales Revenue, Vehicle Margin And Profit By Segment

Electric cars. Pixabay Image.

XPeng Inc. (NYSE:XPEV) designs, develops, manufactures, and sells what the company calls smart electric vehicles primarily in China.

Apart from vehicles, XPeng also develops and designs in-house its driver-assistance system technology and in-car intelligent operating system, as well as core vehicle systems including powertrain and the electrical/electronic architecture.

While XPeng is headquartered in Guangzhou, China, it has offices in several countries around the world, including the U.S. and Europe.

XPeng derives its revenue primarily from sales of smart electric vehicles in China.

The company’s vehicle portfolio consists of large and mid-size sedans and SUVs.

That said, this article presents the total revenue and revenue by segment for XPeng Inc.

Apart from revenue, we also will explore the company’s profitability, margins, and growth rates.

Keep in mind that this article presents only the sales revenue of XPeng Inc.

Investors who are interested in XPeng’s vehicle sales volume may visit this article – XPeng Vehicle Sales Volume.

Without further ado, let’s start with the following topics!

XPeng’s Total Revenue By Year

XPeng total revenue by year

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XPeng’s total revenue reached a record high of RMB 27 billion (USD 3.8 billion) as of 2022, representing a rise of 28% over 2021.

Since 2019, XPeng’s total revenue has grown exponentially, rising by more than 10-fold in just 4 years.

XPeng’s Total Revenue By TTM

XPeng total revenue by ttm

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The TTM plot shows XPeng’s incredible revenue growth prior to 2022.

However, XPeng’s revenue growth seems to have hit a plateau in fiscal 2022.

Since 2022, XPeng’s revenue has gone downhill and is expected to decline to RMB 21 billion (USD 2.9 billion) in 2Q 2023 on a TTM basis, according to the guidance provided by the company during the 1Q 2023 earnings release.

The 2Q 2023 TTM revenue of RMB 21 billion represents a decline of 28% from the same quarter a year ago.

XPeng’s Vehicle Sales And Services Revenue

XPeng revenue by segment

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Xpeng’s revenue comes primarily from 2 major sources or segments, namely vehicle sales, and services and others.

Vehicle sales revenue is sales of electric vehicles which are usually embedded with other products such as free charging, warranty, vehicle internet connection services, etc.

On the other hand, services and others revenue are sales of services such as supercharging services, maintenance services, technical support services, auto financing services, second-hand vehicle sales services, etc.

That said, XPeng’s vehicle sales revenue forms the majority of the company’s total revenue, at RMB 25 billion (USD 3.5 billion) in fiscal 2022 compared to only RMB 2 billion (USD 280 million) generated from services and others revenue in the same period.

Both revenue segments have reported extraordinary growth over the past 4 years, with figures from both segments multiplying by more than 10-fold since fiscal 2019.

XPeng’s Vehicle Sales And Services Revenue In Percentage

XPeng revenue by segment in percentage

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From a percentage perspective, XPeng’s vehicle sales made up more than 90% of the company’s total revenue while that of services revenue came in at less than 10%.

However, since fiscal 2019, the ratio of XPeng’s vehicle sales has been on the decline and reached a record low of 92.5% as of 2022.

On the other hand, the percentage of XPeng’s services revenue has grown to 7.5% as of 2022, a record high in the past 4 years.

XPeng’s rising services revenue percentage illustrates the growing importance of the company’s other sales channels, particularly the services segment.

XPeng’s Revenue Growth Rates

XPeng revenue by segment growth rates

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In terms of revenue growth, we can see that XPeng’s revenue grew the slowest in 2022 over the past 3 years.

In fiscal 2022, XPeng’s total revenue grew only 28% compared to 259% and 151% reported in fiscal 2021 and 2020, respectively.

Similarly, XPeng’s vehicle sales revenue grew only 24% in fiscal 2022 compared to 261% and 156% reported in fiscal 2021 and 2020, respectively.

However, XPeng’s services and others revenue seems to have defied the slower growth rates seen in the vehicle sales sector.

As shown, XPeng’s services and others revenue grew 113% in fiscal 2022 compared to 218% and 98% reported in fiscal 2021 and 2020, respectively.

Overall, XPeng’s revenue growth seems to have peaked in fiscal 2021 after clocking in more than 200% of growth rates in both the vehicle sales and services segments.

XPeng’s Gross Profit By Segment

XPeng gross profit by segment

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From the perspective of profitability, XPeng’s vehicle sales segment brings in the biggest numbers, notably at RMB 2.3 billion (USD 322 million) of gross profit in fiscal 2022.

The services and others sector trailed behind with only RMB 742 million (USD 104 million) of gross profit reported in fiscal 2022.

Also, XPeng has only started to make a profit since fiscal 2020 and incurred massive losses in the year before.

XPeng’s profitability jumped more than 10-fold in fiscal 2021 compared to 2020 when the company reported a record gross profit of RMB 2.6 billion (USD 364 million).

A trend worth mentioning is the stagnant growth of XPeng’s vehicle gross profit in fiscal 2022 over 2021 despite having a vehicle revenue growth of 24% reported in the same period.

It looks like the profitability of XPeng’s vehicle sales was being compromised in the name of revenue growth.

XPeng’s Gross Profit By Segment In Percentage

XPeng gross profit by segment in percentage

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XPeng’s vehicle sales gross profit hovers around 79% of the total on average while that of the services and others segment comes in at 21%.

In other words, XPeng’s vehicle sales segment contributes the most profit to the company and the latest number shows that it was 76% of the total gross profit in fiscal 2022.

Despite contributing only 7.5% of revenue to the company, XPeng’s services and others segment contributed a remarkable 24% of gross profit to the company, suggesting that the important role of the services segment should not be ignored.

XPeng’s Operating Profit

XPeng operating profit

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From the perspective of operations, XPeng had been downright inefficient as the company had not been able to make a profit over the past 4 years.

As shown, XPeng’s operating profit had been negative in all fiscal years.

The worse part is that XPeng’s operating losses had been worsening over the years and reached a record loss of RMB 8.7 billion (USD 1.2 billion) in fiscal 2022.

XPeng’s Gross Margin By Segment

XPeng gross margin by segment

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XPeng’s vehicle sales have significantly lower margins compared to the services and others segment.

As seen in the chart, XPeng managed to deliver a vehicle margin of only 9.4% in fiscal 2022 while the gross margin of services and others segment came in at an outstanding 37% in the same period.

Compared to fiscal 2021, XPeng’s vehicle margin reported in fiscal 2022 was down slightly while that of the services and others segment went significantly higher.

Despite the significantly higher margin contributed by the services and others segment, the revenue contribution from this segment totaled only 7.5% in fiscal 2022 and the ratio came in at 24% for gross profit.

XPeng’s Total Gross Margin

XPeng consolidated gross margin

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On a consolidated basis, XPeng’s gross margin clocked 11.5% in fiscal 2022 and this figure was slightly lower compared to the 12.5% gross margin reported in fiscal 2021.

Moreover, XPeng started to make a profit only in fiscal 2020 and before that, it incurred a significant loss on a consolidated basis.

XPeng’s Operating Margin

XPeng operating margin

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Since XPeng had been operating at a loss, it is no surprise to see negative operating margins in all fiscal years.

While XPeng’s operating loss had been getting worse, the respective margins had been improving and totaled -32% as of fiscal 2022, the best figure that has ever been measured.

Conclusion

To recap, Xpeng’s revenue was at a record high of RMB 27 billion (USD 3.8 billion) as of 2022.

However, the TTM plot shows that the company’s total revenue may have peaked in fiscal 2022 and had been going downhill since 2022.

XPeng’s TTM total revenue is expected to reach RMB 21 billion (USD 2.9 billion) in 2Q 2023, down 28% from the quarter a year ago.

XPeng had only been able to make a profit on a gross basis while incurring operating losses in all fiscal years.

Vehicle margin came in at 9.4% in fiscal 2022 while the services and others segment reported a gross margin of 37% in the same period.

Therefore, XPeng’s revenue outlook, margin, and profitability look kind of disappointing.

What do you think of Xpeng?

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References and Credits

1. All financial figures in this article were obtained and referenced from XPeng Inc.’s SEC filings, earnings reports, financial statements, etc, which are available in XPENG’s Financial Results.

2. Featured images in this article are used under creative commons licenses and sourced from Pixabay.

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