ZEEKR Group’s Earnings Call: Growth Amid Challenges

ZEEKR Intelligent Technology Holding Limited Sponsored ADR ((ZK)) has held its Q1 earnings call. Read on for the main highlights of the call.

ZEEKR Group’s recent earnings call painted a picture of robust growth and innovation, tempered by some concerns about future sales and ongoing losses. The company showcased impressive strides in vehicle deliveries, revenue, and profitability, driven by new product launches and technological advancements. However, the call also highlighted challenges, particularly in sales performance for early 2025 and persistent net losses.

Vehicle Delivery Growth

ZEEKR Group reported a significant milestone in vehicle deliveries, with 114,000 units delivered in Q1 2025, marking a 21% increase compared to the previous year. This growth underscores the company’s expanding market presence and the increasing demand for its vehicles.

Revenue and Profitability Increase

The company achieved a notable financial performance with Q1 2025 revenue reaching RMB22 billion, driven by vehicle revenue of RMB19.1 billion. The vehicle gross margin improved to 16.5%, while the ZEEKR brand margin rose to 21.2%, reflecting enhanced profitability.

Strong Global User Base

ZEEKR’s global user base has grown significantly, surpassing 1.9 million users. This expansion is attributed to the integration with Lynk & Co, which has broadened the company’s reach and customer engagement.

Innovative Product Launches

The introduction of new models such as the ZEEKR 70T, ZEEKR 9X, and Lynk & Co 900 has generated substantial pre-orders and customer interest, highlighting the company’s commitment to innovation and market responsiveness.

Technological Advancements

ZEEKR continues to push the envelope in technology with the launch of the G-Pilot system and advancements in EV battery technology, including the V4 ultra-fast charging project, positioning the company at the forefront of automotive innovation.

Operational Efficiency

Efforts to improve operational efficiency have borne fruit, with R&D expenses decreasing by 25.6% and SG&A expenses dropping by 35.8% quarter-over-quarter, indicating a more streamlined and cost-effective operation.

Sales Performance Concerns

Despite the positive developments, the company faced challenges with sales performance in April, which did not meet expectations. The lack of new product launches in Q1 was cited as a contributing factor to this underperformance.

Net Loss

While there were improvements, ZEEKR reported a net loss of RMB763 million for Q1 2025. This underscores the ongoing challenge of achieving sustainable profitability despite the company’s growth and innovation.

Forward-Looking Guidance

Looking ahead, ZEEKR Group remains focused on expanding its product lineup, enhancing technology, and increasing channel coverage. The company plans further product introductions in the second half of 2025 and is advancing in battery and charging technologies. These strategic initiatives are expected to drive future growth and profitability.

In summary, ZEEKR Group’s earnings call highlighted a dynamic period of growth and innovation, marked by significant achievements in vehicle deliveries and financial performance. However, challenges remain, particularly in sales performance and achieving profitability. The company’s forward-looking strategies aim to address these issues and sustain its upward trajectory.