Xpeng Shares Drop on Weak First Quarter Revenue Forecast
Xpeng forecast first-quarter revenue below estimates on Friday citing weak demand in China. Shares fell 5% despite the firm reporting its first quarterly profit.
Electric vehicle manufacturer Xpeng issued a cautious revenue forecast for the first quarter, trailing market expectations as intense price competition and cooling demand weigh on the automotive sector in China. The projection overshadowed the company's maiden quarterly profit, causing its shares in the United States to drop nearly 5% during morning trading sessions.
The broader market has been pressured by the Chinese government's decision to scale back subsidies, a move intended to curb aggressive discounting after a period of rapid expansion. This shift has impacted several major players, including NIO and BYD Company Limited. Recent data from Benchmark Mineral Intelligence indicates that registrations for new electric and plug-in hybrid vehicles in China fell by 32% last month.
