CBAK Energy Technology Inc (CBAT) Q1 2025 Earnings Call Highlights: Navigating Revenue Declines ...
Net Revenue: $34.9 million, a 41% year-over-year decline.
Battery Business Revenue: $36 million, a 54.6% decrease from the prior year.
Electric Vehicle Segment Revenue: 11.9% increase.
Light Electric Vehicle Segment Revenue: 88.4% growth.
Home Energy Storage Business Revenue: 60.4% decline.
Net Loss: $1.64 million compared to net income of $9.8 million in the same period last year.
Battery Segment Income: Declined from $11.68 million to $0.34 million.
Warning! GuruFocus has detected 6 Warning Signs with CBAT.
Release Date: May 19, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
CBAK Energy Technology Inc (NASDAQ:CBAT) is transitioning to a new product, Model 4,135, which has strong market potential and early positive feedback from customers.
The Nanjing facility is maintaining strong growth momentum with the production of the competitive Model 32,140, which is running at full capacity.
The company is planning to establish a manufacturing facility in Southeast Asia, driven by customer demand, which could enhance its global production footprint.
A major customer has committed to a four-year high-volume purchase agreement, which includes substantial pre-payments, indicating strong future revenue potential.
The new Southeast Asian facility will have flexible manufacturing capabilities, allowing it to produce both Model 32,140 and Model 4,135 cells, which could boost overall business performance.
CBAK Energy Technology Inc (NASDAQ:CBAT) reported a significant year-over-year decline of 41% in net revenues for the first quarter of 2025.
The battery segment experienced a drastic income decline from $11.68 million to $0.34 million, contributing to a net loss of $1.64 million.
The home energy storage business saw a 60.4% decline, negatively impacting overall revenue.
The Dalian facility's primary product, Model 26,650, is considered outdated, affecting its competitiveness.
The company does not anticipate a full recovery until the Dalian facility completes its upgrade and the new Model 4,135 is launched.
Q: Can you confirm the expansion goals for your facilities in Dalian and Nanjing? A: Our plan for the Dalian facility remains unchanged, with the new manufacturing line for Model 4,135 having a capacity of 2.3 gigawatt hours. Construction is expected to be completed by the end of June, with trial production starting in the second half of the year. For Nanjing, we have made pre-payments for 3 gigawatt hours of equipment, but due to a new project in Southeast Asia, we plan to relocate one assembly line there, resulting in 1.5 gigawatt hours for both Nanjing and the Southeast Asian country. Zhiguang Hu, CEO & President
Q: Are your customers likely to stick with cylindrical cells for storage, or might they consider prismatic or pouch cells? A: Our main market is home energy storage systems, where high voltage applications often favor cylindrical cells due to design flexibility. While prismatic cells are used, cylindrical and large cylindrical cells are expected to maintain a significant market share due to their structural stability and suitability for common voltage models. Jiewei Li Thierry, CFO & Company Secretary
Q: Are your portable energy customers looking to pull forward demand during the tariff pause? A: Yes, customers are seeking solutions, including relocating manufacturing lines overseas. Our move to Southeast Asia is client-driven, with favorable terms offered by customers. We have closed a deal and expect to announce further details soon. Companies like Jackery and others are pursuing similar strategies. Zhiguang Hu, CEO & President
Q: What is the status of the agreement with a major customer for a large-scale order? A: We are close to finalizing an agreement for a four-year high-volume order, initially focusing on Model 32,140 and transitioning to Model 4,135. A dedicated manufacturing line in Southeast Asia is planned to support this order, with significant recovery expected next year. Jiewei Li Thierry, CFO & Company Secretary
Q: How do you plan to address the current tariff challenges? A: We are evaluating establishing an overseas manufacturing facility in Southeast Asia and exploring expansion in the United States if costs are justified. The decision to expand into Southeast Asia is customer-driven, with a high-volume purchase agreement in principle. The new facility is expected to begin production by mid-next year. Zhiguang Hu, CEO & President
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Wall Street Journal
21 minutes ago
- Wall Street Journal
China's Foreign-Exchange Reserves Increased Slightly in May
China's foreign-exchange reserves increased slightly in May, as the Chinese yuan strengthened on a temporary tariff truce with the U.S. and Beijing's recent stimulus measures. The country's foreign-exchange reserves rose $3.6 billion to $3.285 trillion at the end of May, the State Administration of Foreign Exchange said Saturday.
Wall Street Journal
31 minutes ago
- Wall Street Journal
How the Cybertruck Came to Embody Tesla's Problems
The bromance between Elon Musk and President Trump is ending at a difficult time for Tesla TSLA 3.67%increase; green up pointing triangle. The electric-vehicle maker lost roughly $150 billion of market value Thursday—its biggest ever drop—after the Tesla CEO and Trump traded insults. Sales of Teslas have slumped this year. Tariffs could disrupt the supply of key components. The sprawling Republican tax-and-spending bill would end tax credits for EV buyers. And Tesla's Cybertruck has been a disappointment. Musk set high expectations for the Cybertruck, telling investors it would be Tesla's 'best product ever.' The angular, stainless steel pickup was supposed to generate buzz for Tesla by showcasing new technology and unlocking the lucrative truck market. Instead, it has become synonymous with Musk's polarizing stint in politics, exposing some owners to graffiti or middle fingers from other drivers. And its reputation has been tarnished among Tesla fans because of a spate of recalls and manufacturing issues that have resulted in cycles of repairs. In the U.S., the company sold fewer than 40,000 Cybertrucks in 2024—well below Musk's ultimate goal of 250,000 a year. In the first quarter of 2025, Tesla sold around 7,100 Cybertrucks in the U.S., according to registration data from S&P Global Mobility. Ford's F-150 Lightning pickup outsold it. In an effort to boost sales, Tesla has rolled out lower-price versions of the truck and started offering buyers incentives such as 0% financing and free upgrades. Almost as soon as the $100,000 Cybertruck hit the road, quality problems began to multiply. Reports on social media cited cracked windshields and spotting from so-called rail dust, orange discoloration similar to rust. In its first year, Tesla recalled the truck seven times to fix dangerous defects. In March, with large metal panels falling off the trucks, the tally rose to eight. Some of the quality problems were known and documented internally before the truck went on sale, including issues with the accelerator pad and windshield wiper that later triggered recalls, said former employees who worked on the Cybertruck. But there was pressure inside Tesla to get the truck to market quickly, according to these employees. Tesla didn't respond to requests for comment. 'Elon Musk will tell you the biggest professional mistake was the falcon doors on the Model X,' said David Fick, a longtime Tesla owner who got his Cybertruck in March. He referred to the complex door design that opens upward and hinges at the roof. 'I believe that the Cybertruck is going to go down as an even bigger corporate stumble.' The retired banker in Boynton Beach, Fla., chose to wait more than a year to buy his Cybertruck, hopeful that many of the biggest issues would be identified before he drove his off the lot. 'They do a lot of bleeding-edge stuff where they rush to the market and then you're a beta tester as an owner,' Fick said. He paid about $72,000 for the car, plus $7,300 for window tinting and a custom wrap for exterior trim panels known as cant rails, covering his new car in a metallic maroon color. Soon after, Tesla recalled cant rails because they could become unglued. 'I've had tons of recalls on my Teslas over the years,' said Fick, who added that the cars are worth the hassle. 'Eighty percent were fixed by [software] updates, but these are physical things we are dealing with now.' Musk unveiled the prototype for the Cybertruck in 2019. At the time, he said it would cost $39,900, with a battery range of up to 500 miles—an ambitious combination that would be a stretch for any EV maker. Work on the vehicle was delayed a couple of years, leaving engineering and manufacturing teams with only a few months to do final testing before the trucks went to customers, former employees said. Musk tried to temper expectations around how quickly Tesla could increase production, given its unique design. 'There is always some chance that Cybertruck will flop, because it is so unlike anything else,' he wrote on social media in July 2021. Still, he promoted some of its most unusual features, including his dream of making the car amphibious. Former employees said they took Musk's social posts as orders, but the engineering proved difficult. By 2022, it was clear internally that Cybertruck wouldn't be able to meet all Musk's criteria, so engineers scrapped an early design and started over—developing a smaller, landlocked version of the truck, the people said. After about a year and a half of testing, Tesla delivered the first Cybertrucks to a dozen or so customers in late November 2023. An early version of the truck started at $100,000 and had an estimated range of 318 miles. Two months later, Tesla issued its first recall on the vehicle: a software update that required the company to increase the size of the font on a warning system used across its fleet. It was the first of three recalls that Tesla addressed on the Cybertruck through over-the-air updates to its software. Cybertruck's problems couldn't be fixed by software updates alone. In April 2024, Tesla issued a recall for the accelerator pedal. The company had received a notice from a customer complaining that the accelerator had gotten stuck. Tesla found that the pad attached to the long pedal could dislodge and get stuck in the trim above the pedal, causing the car to accelerate. An internal investigation found the issue was the result of an 'unapproved change,' in which Tesla employees used soap as a lubricant to attach the pad, according to the recall notice. Inside Tesla, the accelerator pad had been a known issue starting with the prototype, according to an employee who worked on the part. The manufacturing team also identified the part as problematic, this person said. Tesla also had problems with the Cybertruck's expansive windshield, which measured nearly 6 square feet. Sometimes the heavy glass would break, two employees said. The glass either arrived cracked from the supplier in Mexico or from handling at the Austin, Texas, facility, they said. Some owners took to social media to describe the glass cracking as soon as they drove off the lot, or while they wiped the inside of their windshield. The windshield required a large windshield wiper measuring 50 inches long. In June 2024, Tesla issued a recall on the wipers, whose motors Tesla found had been overstressed by testing. The wiper had been flagged nearly a year before, two people who worked on the Cybertruck said. It was one of the first issues identified on the vehicles, at which point it was classified as a 'gating issue,' which meant that it needed to be resolved before production could move forward. Reid Tomasko, a 25-year-old YouTube creator, took his Cybertruck on a cross-country trip, during which it performed perfectly, he said. Then came winter in New Hampshire. He was driving near his home in Lebanon, N.H., in February when a metal panel flew off the side of his truck. In March, Tesla issued a recall affecting most of the Cybertrucks it had produced—more than 46,000. The problem involved adhesive that could become brittle in extreme weather, causing exterior trim panels called cant rails to dislodge. Inspecting his truck, Tomasko said he found loose connections on almost every panel that used the adhesive, including the large pieces of stainless steel over the rear wheels, the front fender and the front doors. 'I was wondering, why are they not recalling the other panels?' Tomasko said. After replacing several panels, Tesla offered to buy back Tomasko's truck for nearly all of the $102,000 that he paid, he said. He accepted. 'I am planning on getting a newer one for cheaper soon,' he said. Write to Becky Peterson at
Yahoo
34 minutes ago
- Yahoo
Trump's trade talk delegation is set to face off with China's negotiators in London. Here is what's at stake.
Top Trump officials are meeting Chinese negotiators in London on Monday. This would be the first official US-China talk since a temporary tariff truce on May 12. International trade experts have said that Trump could be under pressure to strike a deal. Three top Trump administration economic officials will face off against Chinese negotiators in a renewed effort to break the US-China trade deadlock. Secretary of the Treasury Scott Bessent, Secretary of Commerce Howard Lutnick, and Trade Representative Jamieson Greer will be meeting China's delegation in London on Monday. "The meeting should go very well," President Donald Trump wrote in a social media post announcing the talks. This coming meeting will be the first official talk between the two countries since they mutually lowered tariffs in a temporary truce on May 12, after talks in Geneva. The renewed talks follow a 90-minute phone call between Trump and China's leader Xi Jinping on Thursday, a rare direct conversation that Trump later described as "very good." According to Trump, the two leaders also agreed to visit each other in person, without providing more details in terms of a timeline. The Chinese Embassy of Washington did not respond to a request for who would be attending this negotiation from its side. The team they sent to Geneva consisted of Vice Premier He Lifeng, Vice Commerce Minister Li Chenggang, and Vice Finance Minister Liao Min. Notably, Li has a Master of Laws from the University of Hamburg in Germany and has been part of China's delegation to the World Trade Organization since 2021. International trade experts previously told Business Insider that much is at stake for both China and the US to strike a deal, or at the very least, continue the truce beyond August 12 when the 90-day tariff pause will expire. "The Trump administration made their job harder because the tariff policies they've implemented are costly to Americans and American companies, and therefore, the market doesn't like it," said Philip Luck, director of the CSIS Economics Program. "They are under a lot of pressure to do things fast." Meanwhile, a lawsuit that threatens to undo all of Trump's tariffs enacted under the IEEPA also looms over negotiations with China. Drew DeLong, lead in geopolitical dynamics practice at Kearney, a global strategy and management consulting firm, told BI that if the court strikes down tariffs before trade deals could come to pass, other routes of imposing tariffs could be more complicated and time-consuming. The White House did not provide Business Insider with any additional comment beyond Trump's Truth Social post. Read the original article on Business Insider
