Press Release

Li Auto Inc. Announces Unaudited Third Quarter 2020 Financial Results

Nov 13, 2020 at 4:30 AM EST

Quarterly total revenues reached RMB2.51 billion (US$369.8 million)1 
Quarterly deliveries were 8,660 vehicles
Quarterly gross margin reached 19.8%

BEIJING, China, Nov. 13, 2020 (GLOBE NEWSWIRE) -- Li Auto Inc. (“Li Auto” or the “Company”) (Nasdaq: LI), an innovator in China’s new energy vehicle market, today announced its unaudited financial results for the third quarter ended September 30, 2020.

Operating Highlights for the Third Quarter of 2020

  • Deliveries of Li ONEs were 8,660 in the third quarter of 2020, representing a 31.1% quarter-over-quarter increase and setting a new quarterly record.
  2020 Q1 2020 Q2 2020 Q3
Deliveries 2,896 6,604 8,660
  • As of September 30, 2020, the Company had 35 retail stores covering 30 cities.
     

Financial Highlights for the Third Quarter of 2020

  • Vehicle sales were RMB2.46 billion (US$363.0 million) in the third quarter of 2020, representing an increase of 28.4% from RMB1.92 billion in the second quarter of 2020.
  • Vehicle margin2 was 19.8% in the third quarter of 2020, compared with 13.7% in the second quarter of 2020.
  • Total revenues were RMB2.51 billion (US$369.8 million) in the third quarter of 2020, representing an increase of 28.9% from RMB1.95 billion in the second quarter of 2020.
  • Gross profit was RMB496.8 million (US$73.2 million) in the third quarter of 2020, representing an increase of 91.3% from RMB259.7 million in the second quarter of 2020.
  • Gross margin was 19.8% in the third quarter of 2020, compared with 13.3% in the second quarter of 2020.
  • Loss from operations was RMB180.0 million (US$26.5 million) in the third quarter of 2020, representing an increase of 2.1% from RMB176.3 million in the second quarter of 2020. Non-GAAP loss from operations3 was RMB45.0 million (US$6.6 million) in the third quarter of 2020, representing a decrease of 74.5% from RMB176.3 million in the second quarter of 2020.
  • Net loss was RMB106.9 million (US$15.7 million) in the third quarter of 2020, representing an increase of 42.2% from RMB75.2 million in the second quarter of 2020. Non-GAAP net income3 was RMB16.0 million (US$2.4 million) in the third quarter of 2020, compared with RMB159.2 million Non-GAAP net loss3 in the second quarter of 2020.
  • Operating cash flow was RMB929.8 million (US$136.9 million) in the third quarter of 2020, representing an increase of 105.8% from RMB451.7 million in the second quarter of 2020.
  • Free cash flow4 was RMB749.9 million (US$110.4 million) in the third quarter of 2020, representing an increase of 149.3% from RMB300.8 million in the second quarter of 2020.
     

Key Financial Results

(in RMB millions, except for percentages)

  For the Three Months Ended    
  September 30,   June 30,   Q o Q
  2020   2020   % Change5
           
Vehicle sales 2,464.7   1,919.2   28.4%
Vehicle margin 19.8%   13.7%   6.1%
           
Total revenues 2,510.8   1,947.2   28.9%
Gross profit 496.8   259.7   91.3%
Gross margin 19.8%   13.3%   6.5%
           
Loss from operations (180.0)   (176.3)   2.1%
Non-GAAP loss from operations3 (45.0)   (176.3)   (74.5%)
           
Net loss (106.9)   (75.2)   42.2%
Non-GAAP net income/(loss)3 16.0   (159.2)   N/A
           
Operating cash flow 929.8   451.7   105.8%
Free cash flow 749.9   300.8   149.3%
           

 

Recent Developments

Deliveries Update

  • In October 2020, the Company delivered 3,692 Li ONEs, representing a steady increase compared to September 2020. As of October 31, 2020, the Company had 41 retail stores covering 36 cities.
     

Executive and Board Appointments

  • The Company appointed Mr. Kai Wang as chief technology officer, effective September 15, 2020. In this role, Mr. Wang leads the Company’s advanced technology research and development (“R&D”) in smart vehicles, including electronic and electrical architecture, intelligent cockpit, autonomous driving, platform development and Li OS, the real-time operating system of Li Auto. The Company plans to continue recruiting outstanding professionals worldwide to further expand and strengthen its team.
  • The Company appointed Mr. Zheng Fan as a new independent director to the Company’s board of directors, effective October 22, 2020. Following the appointment, Mr. Fan serves as a member of the audit committee, compensation committee, and nominating and corporate governance committee of the board of directors.
     

Strategic Cooperation

  • In September 2020, the Company entered a three-way strategic cooperation with NVIDIA Corporation (“NVIDIA”), the world’s leading artificial intelligence computing company, and NVIDIA’s Chinese partner, Huizhou Desay SV Automotive (“Desay SV”). Through this strategic cooperation, Li Auto will be the first OEM equipping its vehicles, the full-size extended-range premium smart SUV to be launched in 2022, with the powerful NVIDIA Orin system-on-a-chip (“SoC”) chipset. Through this cooperation, the Company plans to further increase its R&D investment and accelerate the development of autonomous driving.
     

CEO and CFO comments

Mr. Xiang Li, founder, chairman and chief executive officer of Li Auto, commented, “This is our first quarterly earnings release as a public company, and we are pleased to announce robust third quarter results reflecting not only our strong growth momentum driven by the outstanding value proposition of our products, but also our relentless pursuit of operating efficiencies. We delivered 8,660 Li ONEs in the third quarter, representing a 31.1% quarter-over-quarter increase and setting a new quarterly record. Cumulative deliveries in 2020 at the end of October reached 21,852 vehicles. This is a strong testament to the competitiveness of the Li ONE. For the fourth quarter of 2020, we expect our growth momentum to continue with deliveries reaching 11,000 to 12,000 vehicles.”

“In terms of R&D, we will further increase our investment in this regard and continue to leverage technology to create value for users and optimize our user experience. Through product and technology innovations, we are committed to providing our users with safer, easier and more cost-effective travel solutions, ensuring we live up to their support and trust.” concluded Mr. Li.

Mr. Tie Li, chief financial officer of Li Auto, added, “We are pleased to report our third quarter financial and operating results with 28.9% quarter-over-quarter growth in total revenues driven by our record quarterly vehicle deliveries, as well as gross margin expansion, which increased to 19.8% compared with 13.3% of the second quarter. In the third quarter, we generated operating cash flow of RMB929.8 million, 105.8% higher than the prior quarter, which demonstrated our operational efficiency and successful cash flow management strategy. Looking forward, we will continue investing in both R&D and direct sales and servicing network expansion, as product iteration and sales channel integrity are the key components of our success."
 

Financial Results for the Third Quarter of 2020

Revenues

  • Total revenues were RMB2.51 billion (US$369.8 million) in the third quarter of 2020, representing an increase of 28.9% from RMB1.95 billion in the second quarter of 2020.
  • Vehicle sales were RMB2.46 billion (US$363.0 million) in the third quarter of 2020, representing an increase of 28.4% from RMB1.92 billion in the second quarter of 2020. The increase in vehicle sales was mainly attributable to a 31.1% increase in vehicle deliveries to 8,660 vehicles in the third quarter of 2020 from 6,604 vehicles in the second quarter of 2020.
  • Other sales and services were RMB46.1 million (US$6.8 million) in the third quarter of 2020, representing an increase of 64.1% from RMB28.1 million in the second quarter of 2020. The increase in other sales and services was in line with the increased vehicle sales and the increased number of vehicles using the Company's services.
     

Cost of Sales and Gross Margin

  • Cost of sales was RMB2.01 billion (US$296.6 million) in the third quarter of 2020, representing an increase of 19.3% from RMB1.69 billion in the second quarter of 2020.
  • Gross profit was RMB496.8 million (US$73.2 million) in the third quarter of 2020, representing an increase of 91.3% from RMB259.7 million in the second quarter of 2020. The increase of gross profit was primarily attributable to increased vehicle sales.
  • Vehicle margin2 was 19.8% in the third quarter of 2020, compared with 13.7% in the second quarter of 2020. The increase in vehicle margin was primarily attributable to the decrease in purchase price of certain materials including a one-time rebate received from a supplier and lower unit manufacturing overhead cost due to the increased production volume.
  • Gross margin was 19.8% in the third quarter of 2020, compared with 13.3% in the second quarter of 2020, which was mainly driven by the increase of vehicle margin.
     

Operating Expenses

  • Total operating expenses were RMB676.7 million (US$99.7 million) in the third quarter of 2020, representing an increase of 55.2% from RMB436.0 million in the second quarter of 2020.
  • Research and development expenses were RMB334.5 million (US$49.3 million) in the third quarter of 2020, representing an increase of 66.1% from RMB201.4 million in the second quarter of 2020. Non-GAAP research and development expenses3 were RMB278.8 million (US$41.1 million) in the third quarter of 2020, representing an increase of 38.4% from RMB201.4 million in the second quarter of 2020. The increase in research and development expenses was primarily attributable to share-based compensation expenses recognized related to the stock options granted to employees with service conditions and a performance condition related to the IPO and initiating research and development for the Company’s next vehicle model, as well as increased headcount.
  • Selling, general and administrative expenses were RMB342.2 million (US$50.4 million) in the third quarter of 2020, representing an increase of 45.9% from RMB234.5 million in the second quarter of 2020. Non-GAAP selling, general and administrative expenses3 were RMB264.2 million (US$38.9 million) in the third quarter of 2020, representing an increase of 12.7% from RMB234.5 million in the second quarter of 2020. The increase in selling, general and administrative expenses was primarily driven by share-based compensation expenses recognized related to the stock options granted to employees with service conditions and a performance condition related to the IPO and increased headcount, as well as increased marketing and promotional expenses.
     

Loss from Operations

  • Loss from operations was RMB180.0 million (US$26.5 million) in the third quarter of 2020, representing an increase of 2.1% from RMB176.3 million in the second quarter of 2020. Non-GAAP loss from operations3 was RMB45.0 million (US$6.6 million) in the third quarter of 2020, representing a decrease of 74.5% from RMB176.3 million in the second quarter of 2020.
     

Net Loss and Earnings Per Share

  • Net loss was RMB106.9 million (US$15.7 million) in the third quarter of 2020, representing an increase of 42.2% from RMB75.2 million in the second quarter of 2020. Non-GAAP net income3 was RMB16.0 million (US$2.4 million) in the third quarter of 2020, compared with RMB159.2 million Non-GAAP net loss3 in the second quarter of 2020.
  • Basic and diluted net loss per ADS attributable to ordinary shareholders were both RMB0.52 (US$0.08) in the third quarter of 2020. Non-GAAP basic and diluted net income per ADS attributable to ordinary shareholders3 were RMB0.03 and RMB0.02, respectively, in the third quarter of 2020.
     

Balance Sheets, Operating Cash Flow and Free Cash Flow

  • Balance of cash and cash equivalents, restricted cash, time deposits and short-term investments was RMB18.92 billion (US$2.79 billion) as of September 30, 2020, compared with RMB3.71 billion as of December 31, 2019. This increase was primarily attributable to the issuance of Series D private financing, the completion of IPO and concurrent private placements.
  • Operating cash flow was RMB929.8 million (US$136.9 million) in the third quarter of 2020, representing an increase of 105.8% from RMB451.7 million in the second quarter of 2020.
  • Free cash flow4 was RMB749.9 million (US$110.4 million) in the third quarter of 2020, representing an increase of 149.3% from RMB300.8 million in the second quarter of 2020.
     

Business Outlook

For the fourth quarter of 2020, the Company expects:

  • Deliveries of vehicles to be between 11,000 and 12,000 units, representing an increase of approximately 27.0% to 38.6% from the third quarter of 2020.
  • Total revenues to be between RMB3.11 billion (US$457.8 million) and RMB3.39 billion (US$499.4 million), representing an increase of approximately 23.9% to 35.1% from the third quarter of 2020.

This business outlook reflects the Company’s current and preliminary view on the business situation and market condition, which is subject to change.
 

Conference Call

Management will hold a conference call at 8:00 a.m. U.S. Eastern Time on Friday, November 13, 2020 (9:00 p.m. Beijing Time on November 13, 2020) to discuss financial results and answer questions from investors and analysts.

For participants who wish to join the call, please complete online registration using the link provided below at least 20 minutes prior to the scheduled call start time. Upon registration, participants will receive the conference call access information, including dial-in numbers, Direct Event passcode, a unique registrant ID and an e-mail with detailed instructions to join the conference call.

Participant Online Registration: https://apac.directeventreg.com/registration/event/5259875

A replay of the conference call will be accessible through November 21, 2020, by dialing the following numbers:

United States: +1-855-452-5696
Mainland China: +86-400-602-2065
Hong Kong, China: +852-3051-2780
International: +61-2-8199-0299
Conference ID: 5259875

Additionally, a live and archived webcast of the conference call will be available on the Company’s investor relations website at http://ir.lixiang.com.
 

Non-GAAP Financial Measure

The Company uses Non-GAAP measures, such as Non-GAAP research and development expenses, Non-GAAP selling, general and administrative expenses, Non-GAAP loss from operations, Non-GAAP net loss, Non-GAAP basic and diluted net income per ADS attributable to ordinary shareholders and free cash flow, in evaluating its operating results and for financial and operational decision-making purposes. By excluding the impact of share-based compensation expenses, changes in fair value of warrants and derivative liabilities, accretion on convertible redeemable preferred shares to redemption value and the effect of exchange rate changes on convertible redeemable preferred shares, the Company believes that the Non-GAAP financial measures help identify underlying trends in its business and enhance the overall understanding of the Company’s past performance and future prospects. The Company also believes that the Non-GAAP financial measures allow for greater visibility with respect to key metrics used by the Company’s management in its financial and operational decision-making.

The Non-GAAP financial measures are not presented in accordance with U.S. GAAP and may be different from Non-GAAP methods of accounting and reporting used by other companies. The Non-GAAP financial measures have limitations as analytical tools and when assessing the Company’s operating performance, investors should not consider them in isolation, or as a substitute for net loss or other consolidated statements of comprehensive loss data prepared in accordance with U.S. GAAP. The Company encourages investors and others to review its financial information in its entirety and not rely on a single financial measure.

The Company mitigates these limitations by reconciling the Non-GAAP financial measures to the most comparable U.S. GAAP performance measures, all of which should be considered when evaluating the Company’s performance.

For more information on the Non-GAAP financial measures, please see the table captioned “Unaudited Reconciliation of GAAP and Non-GAAP Results” set forth at the end of this press release.
 

About Li Auto Inc.

Li Auto Inc. is an innovator in China's new energy vehicle market. The Company designs, develops, manufactures, and sells premium smart electric SUVs. Through innovative products, technology, and business model, the Company provides customers with safe, convenient, and cost-effective mobility solutions. Li Auto is the first to successfully commercialize extended-range electric vehicles in China. The Company started volume production of its first model, Li ONE, in November 2019. With Li ONE, the Company leverages its in-house technology to create value for our customers, focusing on range extension, smart technology, and autonomous driving solutions. Beyond Li ONE, the Company aims to expand its product line by developing new vehicles to target a broader consumer base.

For more information, please visit: http://ir.lixiang.com.
 

Safe Harbor Statement

This press release contains statements that may constitute “forward-looking” statements pursuant to the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “likely to,” and similar statements. Li Auto may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials, and in oral statements made by its officers, directors, or employees to third parties. Statements that are not historical facts, including statements about Li Auto’s beliefs, plans, and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Li Auto’s strategies, future business development, and financial condition and results of operations; Li Auto’s limited operating history; risks associated with extended-range electric vehicles, Li Auto’s ability to develop, manufacture, and deliver vehicles of high quality and appeal to customers; Li Auto’s ability to generate positive cash flow and profits; product defects or any other failure of vehicles to perform as expected; Li Auto’s ability to compete successfully; Li Auto’s ability to build its brand and withstand negative publicity; cancellation of orders for Li Auto’s vehicles; Li Auto’s ability to develop new vehicles; and changes in consumer demand and government incentives, subsidies, or other favorable government policies. Further information regarding these and other risks is included in Li Auto’s filings with the SEC. All information provided in this press release is as of the date of this press release, and Li Auto does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

For investor and media inquiries, please contact:

Li Auto Inc.
Investor Relations
Email: ir@lixiang.com

The Piacente Group, Inc.
Yang Song
Tel: +86-10-6508-0677
Email: Li@tpg-ir.com

Brandi Piacente
Tel: +1-212-481-2050
Email: Li@tpg-ir.com
 

               
 
Li Auto Inc.              
Unaudited Condensed Consolidated Statements of Loss              
               
Amounts expressed in RMB, unless otherwise stated        
(in thousands, except for share and per share data)            
               
  Three Months Ended   Six Months Ended
  June 30,
2020
  September
30, 2020
  September
30, 2020
  June 30,
2020
  (unaudited)   (unaudited)   (unaudited)   (unaudited)
          (US$)    
Revenues:              
Vehicle sales 1,919,184     2,464,724     363,015     2,760,242  
Other sales and services 28,054     46,075     6,786     38,671  
Total revenues 1,947,238     2,510,799     369,801     2,798,913  
Cost of sales:              
Vehicle sales (1,655,443 )   (1,976,078 )   (291,045 )   (2,425,439 )
Other sales and services (32,092 )   (37,970 )   (5,592 )   (45,483 )
Total cost of sales (1,687,535 )   (2,014,048 )   (296,637 )   (2,470,922 )
Gross profit 259,703     496,751     73,164     327,991  
Operating expenses:              
Research and development (201,440 )   (334,527 )   (49,271 )   (391,130 )
Selling, general and administrative (234,543 )   (342,180 )   (50,398 )   (347,304 )
Total operating expenses (435,983 )   (676,707 )   (99,669 )   (738,434 )
Loss from operations (176,280 )   (179,956 )   (26,505 )   (410,443 )
Other income/(expense)              
Interest expense (21,296 )   (12,862 )   (1,894 )   (40,931 )
Interest income and investment income, net 31,538     70,269     10,350     15,363  
Changes in fair value of warrants and derivative liabilities 84,036     12,008     1,769     260,319  
Others, net 6,840     3,612     532     9,044  
Loss before income tax expense (75,162 )   (106,929 )   (15,748 )   (166,648 )
Income tax expense -     -     -     -  
Net loss from continuing operations (75,162 )   (106,929 )   (15,748 )   (166,648 )
Net loss from discontinued operations, net of tax -     -     -     14,373  
Net loss (75,162 )   (106,929 )   (15,748 )   (152,275 )
Accretion on convertible redeemable preferred shares to redemption value (264,208 )   (120,617 )   (17,765 )   (530,573 )
Effect of exchange rate changes on convertible redeemable preferred shares (5,780 )   (93,104 )   (13,713 )   103,966  
Net loss attributable to ordinary shareholders (345,150 )   (320,650 )   (47,226 )   (578,882 )
               
Weighted average number of ADSs6              
Basic and diluted 127,500,000     614,802,583     614,802,583     127,500,000  
Net loss per ADS attributable to ordinary shareholders              
Basic and diluted (2.71 )   (0.52 )   (0.08 )   (4.54 )


 

Li Auto Inc.              
Unaudited Condensed Consolidated Balance Sheets              
               
Amounts expressed in RMB, unless otherwise stated        
(in thousands, except for share and per share data)            
               
  December
31, 2019
  June 30,
2020
  September
30, 2020
  September
30, 2020
  (audited)   (unaudited)   (unaudited)   (unaudited)
              (US$)
ASSETS              
Current assets:              
Cash and cash equivalents 1,296,215     1,062,134     6,472,280     953,264  
Restricted cash 140,027     49,968     338,546     49,862  
Time deposits and short-term investments 2,272,653     2,578,662     12,105,274     1,782,914  
Trade receivable 8,303     83,004     111,836     16,472  
Inventories 518,086     821,259     863,642     127,201  
Prepayments and other current assets 812,956     582,569     685,183     100,916  
Assets held for sale, current 17,599     -     -     -  
Total current assets 5,065,839     5,177,596     20,576,761     3,030,629  
Non-current assets:              
Long-term investments 126,181     160,725     153,286     22,577  
Property, plant and equipment, net 2,795,122     2,496,582     2,497,475     367,838  
Operating lease right-of-use assets, net 510,227     1,275,412     1,289,599     189,937  
Intangible assets, net 673,867     671,351     681,675     100,400  
Other non-current assets 311,933     182,712     183,562     27,036  
Assets held for sale, non-current 30,253     -     -     -  
Total non-current assets 4,447,583     4,786,782     4,805,597     707,788  
Total assets 9,513,422     9,964,378     25,382,358     3,738,417  
LIABILITIES AND EQUITY              
Current liabilities:              
Short-term borrowings 238,957     -     -     -  
Trade and notes payable 624,666     1,306,813     2,070,804     304,996  
Amounts due to related parties 9,764     10,187     13,452     1,981  
Deferred revenue, current 56,695     53,143     157,344     23,174  
Operating and finance lease liabilities, current 538,307     172,432     204,446     30,112  
Warrants and derivative liabilities 1,648,690     1,183,096     -     -  
Accruals and other current liabilities 867,259     579,539     507,192     74,701  
Convertible debts, current 692,520     -     -     -  
Liabilities held for sale, current 2,862     -     -     -  
Total current liabilities 4,679,720     3,305,210     2,953,238     434,964  
Non-current liabilities:              
Long-term borrowings -     497,200     504,367     74,285  
Deferred revenue, non-current 5,943     41,312     76,608     11,283  
Operating and finance lease liabilities, non-current 241,109     1,400,939     1,407,379     207,284  
Other non-current liabilities 5,519     68,912     110,162     16,225  
Total non-current liabilities 252,571     2,008,363     2,098,516     309,077  
Total liabilities 4,932,291     5,313,573     5,051,754     744,041  
Mezzanine equity 10,255,662     10,906,520     -     -  
Total shareholders' (deficit)/equity (5,674,531 )   (6,255,715 )   20,330,604     2,994,376  
Total liabilities, mezzanine equity and shareholders' (deficit)/equity 9,513,422     9,964,378     25,382,358     3,738,417  


 

Li Auto Inc.              
Unaudited Condensed Consolidated Statements of Cash Flows              
               
Amounts expressed in RMB, unless otherwise stated        
(in thousands, except for share and per share data)            
               
  Three Months Ended   Six Months Ended
  June 30,
2020
  September
30, 2020
  September
30, 2020
  June 30,
2020
  (unaudited)   (unaudited)   (unaudited)   (unaudited)
          (US$)    
Net cash provided by operating activities 451,711     929,759     136,939     388,704  
Net cash used in investing activities (372,106 )   (9,883,509 )   (1,455,684 )   (553,523 )
Net cash (used in)/provided by financing activities (30,000 )   14,885,719     2,192,429     (165,977 )
Effect of exchange rate changes 1,849     (233,245 )   (34,353 )   6,509  
Net change in cash, cash equivalents and restricted cash 51,454     5,698,724     839,331     (324,287 )
Cash, cash equivalents and restricted cash at beginning of period 1,060,648     1,112,102     163,795     1,436,389  
Cash, cash equivalents and restricted cash at end of period 1,112,102     6,810,826     1,003,126     1,112,102  
                       
Net cash provided by operating activities 451,711     929,759     136,939     388,704  
Capital expenditures (150,933 )   (179,880 )   (26,493 )   (273,079 )
Free cash flow 300,778     749,879     110,446     115,625  

 

 

Li Auto Inc.              
Unaudited Reconciliation of GAAP and Non-GAAP Results              
               
Amounts expressed in RMB, unless otherwise stated        
(in thousands, except for share and per share data)        
               
  Three Months Ended   Six Months Ended
  June 30,
2020
  September
30, 2020
  September
30, 2020
  June 30,
2020
  (unaudited)   (unaudited)   (unaudited)   (unaudited)
          (US$)    
Cost of sales (1,687,535 )   (2,014,048 )   (296,637 )   (2,470,922 )
Shared-based compensation expenses -     1,225     180     -  
Non-GAAP cost of sales (1,687,535 )   (2,012,823 )   (296,457 )   (2,470,922 )
               
Research and development (201,440 )   (334,527 )   (49,271 )   (391,130 )
Shared-based compensation expenses -     55,715     8,206     -  
Non-GAAP research and development expenses (201,440 )   (278,812 )   (41,065 )   (391,130 )
               
Selling, general and administrative (234,543 )   (342,180 )   (50,398 )   (347,304 )
Shared-based compensation expenses -     77,993     11,487     -  
Non-GAAP selling, general and administrative expenses (234,543 )   (264,187 )   (38,911 )   (347,304 )
               
Loss from operations (176,280 )   (179,956 )   (26,505 )   (410,443 )
Shared-based compensation expenses -     134,933     19,873     -  
Non-GAAP loss from operations (176,280 )   (45,023 )   (6,632 )   (410,443 )
               
Net loss (75,162 )   (106,929 )   (15,748 )   (152,275 )
Shared-based compensation expenses -     134,933     19,873     -  
Changes in fair value of warrants and derivative liabilities (84,036 )   (12,008 )   (1,769 )   (260,319 )
Non-GAAP net (loss) / income (159,198 )   15,996     2,356     (412,594 )
               
Net loss attributable to ordinary shareholders (345,150 )   (320,650 )   (47,226 )   (578,882 )
Shared-based compensation expenses -     134,933     19,873     -  
Changes in fair value of warrants and derivative liabilities (84,036 )   (12,008 )   (1,769 )   (260,319 )
Accretion on convertible redeemable preferred shares to redemption value 264,208     120,617     17,765     530,573  
Effect of exchange rate changes on convertible redeemable preferred shares 5,780     93,104     13,713     (103,966 )
Non-GAAP net (loss)/ income attributable to ordinary shareholders (159,198 )   15,996     2,356     (412,594 )
               
Weighted average number of ADSs (Non-GAAP)              
Basic 127,500,000     614,802,583     614,802,583     127,500,000  
Diluted 127,500,000     832,252,188     832,252,188     127,500,000  
Non-GAAP net (loss)/income per ADS
attributable to ordinary shareholders7
           
Basic (1.25 )   0.03     0.00     (3.24 )
Diluted (1.25 )   0.02     0.00     (3.24 )

 


1All translations from Renminbi(“RMB”) to U.S. dollar(“US$”) are made at a rate of RMB6.7896 to US$1.00, the noon buying rate in effect on September 30, 2020 as set forth in the H.10 statistical release of the Federal Reserve Board.

2Vehicle margin is the margin of vehicle sales, which is calculated based on revenues and cost of sales derived from vehicle sales only.

3The Company’s Non-GAAP financial measures exclude share-based compensation expenses, changes in fair value of warrants and derivative liabilities, accretion on convertible redeemable preferred shares to redemption value and the effect of exchange rate changes on convertible redeemable preferred shares. See “Unaudited Reconciliation of GAAP and Non-GAAP Results” set forth at the end of this press release.

4 Free cash flow represents operating cash flow less capital expenditures.

5Except for vehicle margin and gross margin, where absolute changes instead of percentage changes are calculated.

6Each ADS represents two ordinary shares.

7Non-GAAP basic net (loss)/income per ADS attributable to ordinary shareholders is calculated by dividing Non-GAAP net (loss)/income attributable to ordinary shareholders by the weighted average number of shares outstanding during the periods. Non-GAAP diluted net (loss)/income per ADS attributable to ordinary shareholders is calculated by dividing Non-GAAP net (loss)/income attributable to ordinary shareholders by the weighted average number of shares and dilutive potential shares outstanding during the periods, including the dilutive effect of convertible redeemable preferred shares as determined under the if-converted method and share-based awards as determined under the treasury stock method.