BYD's revenue exceeded Tesla's for the first time. In Q2, its R & D investment reached 30.9 billion yuan: ranking first among A-share companies.

After three years of rapid growth, few people can imagine what it would be like for BYD to "slow down":

The "leader" released its Q2 performance and faced unprecedented doubts: At the opening today, the Hong Kong stocks fell 5.2%, and the A-shares fell 3.8%. The corresponding market values evaporated by HK$71.2 billion and RMB40 billion respectively.

In the past three months, BYD's domestic sales decreased year-on-year and month-on-month continuously; the gross profit margin in the second quarter declined by nearly 4% quarter-on-quarter; the net profit attributable to the parent company decreased by RMB2.7 billion and RMB2.8 billion year-on-year and quarter-on-quarter respectively.

If you simply look at this table, many people will think that BYD's performance is below expectations. For example, the net profit of RMB15.51 billion is far lower than the market's general expectation of RMB18 billion. Some even shouted "a big disappointment".

On the other hand, BYD still achieved some milestones in the first half of 2025:

The revenue reached RMB371.28 billion, surpassing Tesla for the first time; the R & D investment was RMB30.9 billion, a year-on-year increase of 53%, ranking first among A-share listed companies; the overseas business reached RMB135.358 billion, a year-on-year increase of 50.5%, accounting for 36.5% of the total revenue.

What's really going on with BYD? AI4Auto analyzes the financial report for you and presents a more complete picture of its fundamentals.

How were BYD's fundamentals in the first half of the year?

In the second quarter, BYD sold 2.146 million new vehicles, a year-on-year increase of 33.04%.

This drove the revenue to RMB200.92 billion, a year-on-year increase of 14% and a quarter-on-quarter increase of 17.9%. In the first half of 2025, BYD achieved a revenue of RMB371.28 billion, a year-on-year increase of 23.30%:

With the half - year revenue, BYD surpassed Tesla for the first time, whose revenue was US$41.8 billion (equivalent to about RMB299.5 billion).

Of course, BYD's total revenue comes not only from automobiles but also from electronics, energy storage, semiconductors, rail transit, etc. However, the automobile business has always been the absolute mainstay.

For example, in the total revenue in the first half of 2025, the revenue from the automobile business was RMB302.5 billion, accounting for more than 80%, a year-on-year increase of 32.5%.

BYD's expenditures include the following aspects:

First is the R & D expense. In the first half of 2025, it was as high as RMB30.9 billion, a year-on-year increase of 53%. This growth rate is more than twice that of the revenue growth rate, and it also ranks first among A-share listed companies in terms of R & D investment.

Another point is that the proportion of R & D investment in revenue has continuously reached new highs in the past three years. In the first half of this year, the proportion has reached 8.3%.

The sales expenses, management expenses, financial expenses, etc. totaled about RMB25 billion. Among them, the growth rate of management expenses was 35%, significantly higher than the revenue growth rate. It may be that BYD faces challenges in personnel management after its scale expansion, and there is still much potential to be tapped in management efficiency improvement in the future.

Finally, the net profit in the first half of the year was RMB15.51 billion, a year-on-year increase of 13.79%:

BYD's net profit in the first quarter was RMB9.16 billion, more than doubling. In the second quarter, the net profit was RMB6.35 billion, a decrease of about 30%.

This is also the first time in 14 quarters that BYD's net profit has declined year-on-year.

The gross profit margin in the second quarter was 18%, a year-on-year decrease of 2%:

The net profit (generally considered to be > RMB18 billion) being lower than expected and the decline in the gross profit margin are the main factors for the decline of BYD's stock price after the opening.

It is growing, but not as fast as expected. The growth of revenue and profit is out of proportion. In other words, its profitability has declined.

The background in the first half of the year was:

BYD engaged in a price war for half a year, but actually achieved "less result with more effort". The growth of volume and profit was out of proportion.

Fortunately, there are still new growth engines found by BYD in the financial report.

Breaking down the fundamental data, where is BYD at now?

BYD's potential and growth are actually obvious.

First, let's break down the sales composition:

BYD's overseas sales from January to July exceeded 550,000 vehicles, a year-on-year growth rate of more than 130%, accounting for more than 22% of the total sales.

According to BYD's goal, the minimum target this year is 5 million vehicles, among which the overseas sales are expected to exceed 1 million vehicles, and there are even higher expectations.

Corresponding to the revenue, the overseas business reached RMB135.358 billion, a year-on-year increase of 50.5%, accounting for 36.5% of the total revenue.

There is no doubt that going global is the most potential growth engine for BYD in the next stage.

There is more direct evidence in the financial report.

In the first half of 2025, BYD's capital expenditure was RMB80.5 billion, a year-on-year increase of 71%.

What does this mean? Actually, this is BYD racing with the whole industry:

Several overseas vehicle bases and battery bases have been put into production, and some are still under construction.

This is the foundation for BYD to challenge Volkswagen and Toyota. The layout for BYD to strive for a global production and sales volume of 10 million vehicles in the next few years has basically been implemented.

The "race" is also reflected in the R & D investment. Besides the R & D investment of RMB30.9 billion ranking first among A - share companies, in the first half of 2025, as in most years, BYD's R & D investment was higher than the net profit.

This also explains the problem of the gross profit being lower than expected.

BYD rarely capitalizes its R & D investment in recent years. It is basically expensed. That is to say, the R & D investment will not be converted into intangible assets and will not be amortized over the years, which affects the current profit.

For example, the R & D expense ratio has been over 95% in the past three years. Even if calculated according to the average expense ratio of about 50% from 2012 - 2018, at least more than RMB10 billion in profit could be released in the first half of 2025.

As for the decline in the gross profit margin, BYD actually has nothing to complain about. After all, BYD fired the first shot in the price war, so it is inevitable to have some after - effects now.

It seems that BYD's strategy was to protect the profit in the first quarter and loosen the profit requirement in the second quarter, selling more vehicles at a lower price. Therefore, the profit declined significantly.

At the same time, the objective factor is that the price war has caused great damage.

The deep - seated factor is that the domestic growth is gradually stabilizing. On the one hand, the overseas production capacity construction is accelerating. On the other hand, it is using technology to gain time and space. Both expenditures have increased significantly.

But BYD is still calm and even "hides" the profit intentionally. Its resilience and potential are still No. 1 among domestic independent brands.

What other data are worth paying attention to?

BYD's "below - expectations" performance actually means that it doesn't intend to inflate the profit through financial means in the context of the fierce price war.

Because it really has the confidence and doesn't need to prove itself through short - term profit.

This is the "privilege" and reward for BYD's continuous high - intensity investment over the years to climb the technological peak.

First, at the end of June 2025, BYD's cash reserve was RMB156.1 billion, slightly higher than that at the end of 2024 (RMB154.9 billion), which can ensure the stable operation of the enterprise.

Second, in the first half of 2025, the net operating cash flow was RMB31.8 billion, a year-on-year increase of 125%, indicating that BYD's overall business scale is still expanding rapidly.

The "debt" that is often mentioned. BYD's asset - liability ratio was 71.8% at the end of June 2025, and the total debt exceeded RMB600 billion. However, compared with 77.9% at the end of June 2023, BYD has reduced it by 6.1 percentage points.

At first glance, it seems scary. But BYD's scale is unmatched by other domestic independent automakers. Moreover, this debt ratio is just an average level among global automakers: