CBAK Energy Technology 2025 Q1 Earnings Misses Targets as Net Income Falls 121.4%
Daily EarningsMonday, May 19, 2025 11:10 pm ET
4min readRevenue
CBAK Energy Technology's revenue across various segments showed varied performance. The electric vehicles segment generated $537,507, while light electric vehicles brought in $2.84 million. Residential energy supply and uninterruptible supplies accounted for $16.98 million. The cathode segment earned $11.26 million, and the precursor segment added $3.31 million, culminating in a total revenue of $34.94 million.
Earnings/Net Income
CBAK Energy Technology reported a net loss of $-2.05 million in Q1 2025, a severe deterioration from the $9.57 million net income in Q1 2024. The EPS decline indicates a negative financial performance in Q1 2025.
Price Action
The stock price of CBAK Energy Technology has edged up 0.63% during the latest trading day, has tumbled 10.95% during the most recent full trading week, and has surged 20.15% month-to-date.
Post-Earnings Price Action Review
The "Buy and Hold" strategy for CBAK Energy Technology, Inc. (CBAT) revealed that buying the stock after it exceeded revenue expectations and holding it for 30 days yielded impressive returns. This strategy highlighted CBAT's potential as a profitable investment option, despite a 41% year-over-year decline in Q1 2025 financial results due to product transition challenges. The strategy's backtest showed a notable increase in CBAT's stock price, indicating a positive market reaction to the earnings beat. Moreover, this approach outperformed the S&P 500 benchmark, making CBAT a stronger investment during this period. Risk management was effective, as the 30-day holding period mitigated potential losses. Overall, the strategy proved profitable, particularly in transition phases like CBAK Energy's, where the market rewards earnings beats positively despite broader challenges.
CEO Commentary
Zhiguang Hu, CEO of CBAK Energy Technology, acknowledged a 41% year-over-year decline in net revenues to $34.9 million, primarily due to a significant drop in their battery business, which saw a 54.6% decrease. He emphasized the ongoing upgrade of their Dalian facility, transitioning to the Model 40135, which is expected to enhance their product lineup. Despite the temporary setback, Hu expressed optimism about strong market potential, particularly for the Model 32140 from their Nanjing operations, which is currently running at full capacity. He reinforced confidence in regaining growth momentum with the upcoming launch of the Model 40135 and highlighted plans for an overseas manufacturing facility in Southeast Asia, driven by customer demand.
Guidance
CBAK Energy Technology expects to begin production of the Model 40135 in the second half of 2025, following the completion of facility upgrades. The CEO mentioned that they anticipate a significant recovery in business performance starting next year, contingent upon finalizing agreements with major customers for high-volume orders. The new Southeast Asian facility is projected to begin mass production by mid-2026, supporting both Model 32140 and Model 40135 cells, with a focus on maintaining healthy gross margins to enhance net income recovery.
Additional News
Recently, CBAK Energy Technology announced a strategic partnership with Kandi Technologies Group, Inc. to establish two lithium battery production facilities in the United States. This collaboration aims to localize lithium battery facilities in phases, beginning with battery pack assembly and eventually expanding to battery cell manufacturing. Additionally, CBAK Energy captured a 14.6% share of the 32140 cylindrical cell market in Q1 2025, positioning the company fourth globally in this segment. CBAK Energy also announced participation in the Shenzhen International Battery Technology Conference & Expo, showcasing its advancements in battery technology and engaging with industry leaders.
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