BYD , China’s biggest electric vehicle maker by sales, on Friday posted its first annual profit drop in four years, hit by weak sales in its home market.
Net profit slid 19 per cent to 32.6 billion yuan ($4.72 billion), the automaker said in a stock exchange filing, compared with an average 12.1 per cent fall expected by analysts polled by LSEG. Revenue grew 3.5 per cent, the weakest rate in six years.
For the three months through December, profit fell 38.2 per cent from a year earlier to 9.3 billion yuan, a third consecutive quarter of decline.
Gross profit margin from autos and related products, which contributed 80.7 per cent to operating revenue, slipped to 20.5 per cent last year, down 1.8 percentage points from a year earlier.
BYD’s shares rose 3.7 per cent ahead of the results in Hong Kong and closed up 2.1 per cent in Shenzhen.
A profit dip raises questions about the company’s earnings visibility after years of rapid growth, reinforcing a more cautious view on the EV sector in China, the world’s largest auto market.
Policy support remains strong, but margins are under pressure and returns increasingly depend on scale, cost control and global expansion.
“We also recognise that competition in the (new energy vehicle) industry has reached a fever pitch, and is undergoing a brutal ‘knockout stage’,” BYD chairman Wang Chuanfu said in its earnings statement, while reaffirming its overseas push.
BYD was once propelled by its affordable Dynasty and Ocean series, but has been losing ground as rivals such as Leapmotor and Geely narrow its technological lead.
It was China’s biggest automaker in 2025 but fell to fourth place over the January to February period when its overall sales dropped by the most since the COVID-19 pandemic.
BYD makes only all-electric and plug-in petrol-electric hybrid vehicles, so has suffered the most from the expiration of purchase tax exemption on new energy vehicles.
Sales were also impacted this year by revised subsidies favouring models priced higher than those in BYD’s core budget segment.
Cars going for under 150,000 yuan ($21,699) accounted over 61 per cent of BYD’s domestic sales in November, based on a Reuters analysis of the company’s filings and sales data from Chinese auto analytics platform DATADIC.
To revive sales, BYD unveiled 11 models with a faster-charging battery and pledged to grow its flash charging network. Still, the higher-priced lineup is unlikely to be enough to boost sales as consumers increasingly seek affordable options, analysts said.
The company on Thursday priced its Song Ultra EV with new battery technology below the presale level.
BYD said it would expand sales abroad. Overseas sales as a share of the total more than doubled to 22.7 per cent last year and more than doubled again to 50 per cent in January-February. Even so, overseas sales are not enough to offset weak sales at home.
Overseas sales delivered a 19.5 per cent gross profit margin last year, up 1.9 percentage points from a year prior, versus a 3.5 per cent slide from domestic sales.
