Kandi Technologies ((KNDI)) has held its Q2 earnings call. Read on for the main highlights of the call.
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Kandi Technologies’ recent earnings call painted a mixed picture for the first half of 2025. While the company celebrated significant improvements in gross margin and strategic partnerships in emerging segments, it also faced challenges with a notable decline in revenue and net income. Despite these hurdles, Kandi maintains a strong financial position and remains optimistic about its strategic initiatives.
Gross Margin Improvement
Kandi Technologies reported a substantial improvement in its gross margin, which rose to 45.2% for the first half of 2025, up from 31.7% in the same period of 2024. This increase reflects the company’s effective refined operations and cost control initiatives, showcasing their ability to enhance profitability despite a challenging revenue environment.
Expansion in Retail Outlets and Dealer Network
The company has expanded its market reach, with products now available in 1,050 retail outlets. Additionally, the dealer network has grown, with the dealer to retail sales mix improving from 129 to 228 by the end of June 2025. This expansion is a strategic move to increase market penetration and drive future sales growth.
Innovation and Partnerships in Emerging Segments
Kandi is making strides in innovation and strategic partnerships, particularly in emerging segments. The company has partnered with Deep Robotics to develop intelligent equipment and secured a significant order with CATL for battery swapping station equipment, supporting a plan for 10,000 stations. These initiatives position Kandi at the forefront of new energy infrastructure development.
Strong Financial Position
As of June 30, 2025, Kandi Technologies held $257 million in cash, cash equivalents, restricted cash, and certificates of deposit. This strong liquidity position provides the company with the financial flexibility to pursue strategic initiatives and weather short-term challenges.
Significant Revenue Decrease
Despite positive developments, Kandi faced a significant revenue decline, with net revenues falling to $36.3 million, down 39.3% from $59.8 million for the same period of 2024. This decrease was primarily due to lower sales of off-road vehicles and EV products, highlighting a key area for potential recovery.
Decrease in Net Income
Kandi’s net income decreased to $1.7 million compared to $2.4 million for the same period of 2024. This decline in profitability underscores the impact of reduced revenues and increased R&D expenses on the company’s bottom line.
Increased R&D Expenses
Research and development expenses rose by 48.5% to $2.5 million from $1.7 million in 2024, mainly due to a battery product R&D project. This investment in R&D reflects Kandi’s commitment to innovation and long-term growth.
Forward-Looking Guidance
Looking ahead, Kandi Technologies remains focused on enhancing its market presence through strategic partnerships and expansion into intelligent equipment and new energy infrastructure sectors. The company aims to leverage its strong cash position to support these initiatives, despite the current revenue challenges. Kandi’s collaboration with Deep Robotics and the order for battery swapping station equipment with CATL are pivotal to its future growth strategy.
In summary, Kandi Technologies’ earnings call highlighted a mixed performance for the first half of 2025. While the company achieved significant improvements in gross margin and strategic partnerships, it faced challenges with declining revenues and net income. Nevertheless, Kandi’s strong financial position and focus on innovation and strategic growth initiatives provide a foundation for future success.