Lotus Technology Inc. American Depositary Shares Q4 FY2025 earnings call

2025 is a key year for the company's strategic transformation. In competition marketing, the first Lotus Cup was held in November 2025. In equity financing, received strategic equity investment. In technical development, ChaoPao SUV Electra obtained European Economic Commission's 22171 certification. In brand development, co - founded House Automotive for an exclusive exhibition. Market strategy: refined global footprint and made sales channels more efficient. In China, expanded network and upgraded supply chain. In North America, planned to expand Canadian business network. In Europe, reorganized and simplified organizational structure. Product lineup: driving product competitiveness by expanding product range and power options, launched new hybrid SUV 4Me Electra X and will gradually launch it to global market.

In the fourth quarter, the company delivered 1,908 vehicles, including 1,239 lifestyle SUVs and sedans, and 670 sports cars. For the full year 2025, total delivery reached 6,520 units, a 64% year - on - year decrease. Total revenues for the fourth quarter were $163 million, a 40% year - on - year decrease. For the full year 2025, total revenues were $519 million, down 44% year - on - year. Sales of goods fell 48% year - on - year to $563 million, while services revenue surged 69% year - on - year to $56 million. Gross margin improved significantly to 10% in the fourth quarter compared to negative 11% in the same period of 2024. For the full year, gross margin improved to 9% from 3% in 2024. Lifestyle vehicles deliveries accounted for 7% of the total with sports car making up the remaining 30%. By region, China accounted for 45% of full - year deliveries, Europe 34%, North America 16%, and the rest of the world 5%.

Expect the global launch of our PHEV model, 4Me, to drive sales and revenue growth. Focus on revenue growth efforts, maximizing product positioning, and enhancing margins through strict cost reductions to progress towards profitability and deliver long - term value to shareholders.

Tariffs uncertainty impacted production, inventory and pricing. Geopolitical situation potential impact on future. Oil price rise leading to supply chain cost increase.

Q: About the total deliveries of 2025 down year - on - year by almost a half, what are the main drivers of this volume decline in 2025 and how should we think about the potential impact of the geopolitical situation on the future?

A: Affected by tariffs, uncertainty of tariffs had great impact, also brought challenges to storage management and production industry. For example, US and UK tariffs caused delivery volume to drop by about 60%. EU and US tariffs against Chinese - made EVs exerted pressure on pricing in EU and US market was hard to enter. Also affected inventory management and destocking progress. But US and UK tariffs have been resolved to some extent, Canada has lowered tariffs on Chinese electric vehicles, and there are opportunities in new markets.

Q: After the launch of LOTUS 4Me, the PHEV model, could you provide an update on the current order intake and delivery progress and elaborate more about the volume expectation and the strategic positioning this big model?

A: 4Me is the first plug - in hybrid vehicle in 78 years, redefined real high - performance. Order status shows increased consumer assets. In China, PHEV SUV sales above 400,000 are increasing. Helped expand user group, reached wider customer group including corporate executives. Will be launched to global market gradually, and has good prospects in different markets.