VinFast's Q2 2025 Earnings Call: Contradictions Emerge on Cost Discipline, Market Strategy, and U.S. Expansion

The above is the analysis of the conflicting points in this earnings call

Date of Call: September 4, 2025

Financials Results

• Revenue: $663M, up 92% YOY and up 2% QOQ
• Gross Margin: -41%, improved from -63% in Q2 2024 but down from -35% in Q1 2025; excluding free charging/NRV/deferred revenue impacts: -20.9% vs -19.3% in Q1 2025 and -33.7% in Q2 2024

Guidance:

• 2025 deliveries targeted at ~200,000 units (at least double 2024); significant H2 ramp expected.
• H2 drivers: strong Vietnam demand, expanded dealer/aftersales and charging, VF 6/VF 7 launches, and fleet sales (GSM, operators).
• India: sales to begin in Q3; Tamil Nadu plant opened (50k initial capacity, scalable to 250k).
• Indonesia: Subang CKD facility targeting technical SOP by end-2025; battery leasing reintroduced to accelerate adoption.
• Near-term operating cash outflows expected at $400M–$600M per quarter; warranty costs to trend down as products mature.
• Liquidity runway through 2026–2027; e-bus debut in Europe (October).

Business Commentary:

• Vietnam Market Growth and Share:
• In Vietnam, VinFast achieved a 172% year-over-year increase in EV deliveries and 92% year-over-year revenue growth for Q2 2025.

• This growth was driven by strong demand in the home market and strategic expansion in production capacity.

• International Expansion and Product Launches:

• VinFast's international expansion has led to significant progress in markets like India and Indonesia, with 5% of total EV deliveries in Q2 coming from Indonesia.

• This expansion is supported by the inauguration of new plants in Vietnam and India, as well as strategic partnerships to enhance market presence.

• Manufacturing and Product Development:

• VinFast inaugurated its second plant in Vietnam and opened a CKD manufacturing facility in India, with production capacity up to 200,000 units per year.

• The company's innovation in next-generation vehicle platforms, like the Limo Green MPV, is expected to drive cost efficiencies and improved customer experience.

• R&D Investments and Financial Strategy:

• VinFast reported USD 93 million in R&D expenses for Q2 2025, with a focus on new models and technology refresh.
• The company's financial position was strengthened by a spin-off of completed R&D assets, with a USD 1.6 billion cash infusion expected from the transaction.

Sentiment Analysis:

• Management highlighted strong growth and liquidity but persistent losses. Revenue rose to $663M (+92% YOY). They reiterated confidence in a ~200k 2025 delivery target and a stronger H2. Gross margin was -41% in Q2 (worse than Q1’s -35%), though -20.9% excluding certain items. Near-term operating cash outflows are guided at $400–$600M per quarter. Liquidity stood at ~$4.2B including expected proceeds, providing runway through 2026–2027.

Q&A:

• Question from Andres Sheppard-Slinger (Cantor Fitzgerald): Can you provide more color on cost discipline and how to think about gross margins and blended ASPs for H2 and into next year?
  Response: Most BOM savings on VF 3/VF 5/e34 are realized; bigger cost reductions come with new-platform VF 6/VF 7 via design optimization, in-house battery, and supplier partnerships; margins will vary by mix.

• Question from Andres Sheppard-Slinger (Cantor Fitzgerald): Where will H2 growth primarily come from—Vietnam or India/Indonesia/Philippines?
  Response: Management expects to reach ~200k 2025 deliveries with H2 driven by Vietnam demand, stronger international dealer/aftersales and charging, new VF 6/VF 7 launches, and expanding fleet sales (GSM and others).