Financial recovery, market value frozen: Is Lotus' luxury electric dream only worth a market value of $830 million?

Recently, the global luxury electric vehicle market has been going through a turbulent period. With Tesla's Model S Plaid announcing price cuts and Porsche's Taycan facing inventory backlogs, the high - end electric vehicle market as a whole presents a situation of "weak demand and intensified competition".

According to data from the China Association of Automobile Manufacturers, the overall market for luxury cars priced over 400,000 yuan in China declined by 9.7% in the first three quarters of 2025.

In this endless market transformation, Lotus is a very worthy object for in - depth analysis. This luxury sports car brand, which originated in the UK and is backed by Geely, has been fully caught in the crossfire between tradition and innovation.

The latest financial report shows that in the third quarter, it achieved revenues of $137 million, narrowed the net loss by 68%, and increased the gross profit margin to 8%. How is Lotus' unique transformation going against the wind?

Cost - cutting has achieved results, and profitability is just around the corner

Lotus' third - quarter financial report is more like a clinical report on "precise loss control".

Data shows that the company's revenues in the quarter were $137 million, and the cumulative revenues in the first nine months were $356 million. Although the scale is not as large as that of leading new - energy vehicle startups, key indicators have shown a turnaround:

In the third quarter, the gross profit margin jumped to 8% from the low point of the same period last year. The net loss narrowed to $65 million, a 68% year - on - year reduction, which is better than the 41% reduction in the first nine months, indicating that the improvement in operating efficiency is on a seasonal upward trend. This improvement is not accidental but the result of a two - pronged approach of cost control and product strategy.

On the one hand, Lotus demonstrated "surgical" financial discipline. Through inventory optimization and operating expense cuts, its Adjusted EBITDA in the third quarter narrowed by 70%. CFO Wang Daxue said bluntly that "cost control has achieved remarkable results".

Interestingly, the company also obtained a $300 million convertible bond financing from ATW Partners in August and a 1.6 billion - yuan credit support from Geely. These funds were not blindly invested in capacity expansion but focused on R & D and brand building, reflecting the management's strict pursuit of cash - flow quality. In an industry context where companies generally "burn money for market share", this prudence has become a scarce asset.

On the other hand, the optimization of the product structure has become the engine for the improvement of the gross profit margin. In the first nine months, Lotus delivered 4,612 vehicles, including 1,298 sports cars and 3,314 lifestyle models.

After the upgraded sports car was launched in September, the proportion of high - margin models increased, directly driving up the average selling price. Especially in the Chinese market, the ELETRE super - car topped the pure - electric vehicle segment priced over 400,000 yuan, enabling Lotus to achieve an 11% year - on - year growth against the backdrop of a 9.7% decline in the overall luxury car market. This confirms a rule: once a high - end brand gains pricing power, it can avoid some price - war whirlpools and rely on product strength instead.

However, the impressive data needs to be examined in the context of the industry. Horizontally, NIO and Li Auto maintained a gross profit margin in the range of 15% - 20% during the same period, and Lotus' 8% gross profit margin still seems immature; vertically, the shadow of net loss has not completely disappeared.

It can be seen that although the phased reduction in losses is encouraging, whether it can be sustained still depends on the deepening of economies of scale and supply - chain synergy. When focusing on financial indicators, Lotus needs to find a dynamic balance between cost reduction and profit increase in the future to avoid getting stuck in the bottleneck of "cutting costs but having difficulty increasing revenues".

The capital market isn't convinced! The luxury electric dream is only worth $830 million

Challengingly, despite the continuous improvement in Lotus' business operations, the capital market doesn't seem to be convinced. After the release of this quarterly report, the stock price still didn't show much improvement. As of November 25, the total market value of the company's US stocks was only $830 million, an 88% decline from the high point at the time of its listing in early 2024. Such a dismal market - value performance directly reveals the deep - seated challenges faced by Lotus Technology.

The cold response from the capital market is partly due to concerns about the overall luxury electric vehicle track and doubts about the company's unclear transformation situation.

In the past, Feng Qingfeng, the CEO of the Lotus Group, has publicly stated on multiple occasions that the global penetration rate of ultra - high - end luxury electric vehicles has fallen short of expectations, while the development of super hybrid - electric technology has been very rapid. This judgment prompted Lotus to quickly make a pragmatic adjustment to its technology roadmap and launch the "Luyao" super hybrid - electric technology. It is reported that a new car is planned to be unveiled at the end of the year. This strategic flexibility is worthy of recognition, but it also reflects the uncertainty the company faces in choosing a technology roadmap.

In a more forward - looking business layout, Lotus Robotics has signed an agreement with an overseas partner to explore the development of the Robotaxi business in Saudi Arabia. Specifically, it will upgrade intelligent driving technology from an in - vehicle function to a commercializable solution, following a 2B path similar to that of Waymo.

This move goes beyond the current functional competition and aims at seizing a position in the future travel ecosystem. However, in essence, it is also an exploration based on the unclear situation of Lotus' business map, and the commercialization of this scenario also requires a lot of time for verification.

To support future development, Lotus has actively planned its capital operations, including the dual - financing method of "external market - based capital + internal strategic shareholder support" mentioned above. How to efficiently convert funds into an improvement in market competitiveness remains a long - term key question that the management needs to answer.

In terms of brand building, Lotus has adopted a two - pronged strategy. On the one hand, it strengthens its performance label through event marketing. Winning the championship and runner - up in the Macau Grand Prix and launching the Lotus Cup single - make race in Chengdu, these activities may seem costly, but they are actually precise investments to convey the "driving belief" to high - net - worth users; on the other hand, it showcases the results of its electrification and intelligent transformation at international auto shows such as the IAA Munich Motor Show.

CEO Feng Qingfeng once pointed out that users' perception of Lotus is mainly focused on "beauty" and "performance", but competition in the era of intelligent electric vehicles requires multi - dimensional empowerment. Therefore, we can see that it participates in the London Design Festival, releases an ESG report, and even conducts high - level safe - driving public - welfare training. These measures aim to inject new connotations of "safety" and "sustainability" into performance and change the one - dimensional and stereotyped impression of the brand.

A series of combined efforts by Lotus are precisely aimed at breaking through users' single perception of the brand as "beautiful" and "high - performance" and building a three - dimensional image of "luxury + electric + intelligent".

Looking through all the financial reports since its listing, Lotus has been trying to achieve "vertical in - depth cultivation and horizontal evolution of its luxury genes" through brand - strategy and globalization - layout iterations; and it has been trying to redefine the core of "luxury electric" through event marketing, technology transformation, and overseas exploration.

But effort is an action whose duration is hard to judge and whose outcome is unpredictable. Lotus' breakthrough still faces multiple paradoxes: First, although hybrid technology expands the market base, it may dilute its pure - electric luxury label; second, the Robotaxi business requires long - term investment and may increase losses in the short term, and its feasibility may be limited; third, the continuous slump in the stock price reflects the limited patience of the capital market for the "slow - growth" model.

These contradictions require Lotus to demonstrate a higher - level balancing act in its strategy: it needs to maintain the purity of its super - car genes and find a fulcrum between scale and personalization.

This article is from the WeChat official account "US Stock Research Club" (ID: meigushe), author: US Stock Research Club. It is published by 36Kr with authorization.