LOTWW

• Financial metrics: Q3 gross profit was $11 million, operating loss $95 million (41% improvement YOY), net loss $65 million (68% improvement YOY). First nine months operating loss $370 million (narrowing 40% YOY), net loss $378 million (narrowing 43% YOY). Non-GAAP adjusted net loss for first nine months was $2 million lower due to share-based compensation impact. Adjusted EBITDA for first nine months narrowed 48% YOY to $294 million.
• Operational efficiency: Reduced operating expenses for eight consecutive quarters through value-added measures.
• Milestones: Unveiling new PHEV model in coming months, strong appearance at IAA Mobility 2025, 2025 Lotus car one-make racing series kicked off, Mira GT4 podium in Macau Grand Prix.
• Market strategy: 213 retail stores globally with balanced distribution across regions; optimized global presence, retail efficiency; implemented cost control measures, relocated European HQ from The Netherlands to UK; preparing to enter Brazil.
• Product portfolio: Currently offers two models, planning to introduce two new hybrid models based on new architecture; first hybrid model to launch in China Q1 next year, with EU release later; new hybrid models feature ultimate handling, long range, high performance, and inspired design.
• Acquisition of Lotus UK: Progress on merger/acquisition expected to complete in 2026; will operate under 'One Lotus' strategy; driving synergy in R&D, purchasing, logistics, and global channel/system alignment.

• Gross margin for full year 2025 is expected to remain at a high single-digit range.
• Next year's gross margin is projected to further improve due to several factors: launch of PHEV products based on Luoyang architecture reducing per-unit vehicle costs and boosting gross margins; BEV fixed-lifted products' sales expected to increase; implementation of put option with Lotus UK enhancing efficiency through consolidated manufacturing segment gross profit and supply chain/research and development integration economies of scale.

In the third quarter, Lotus Technology Inc. delivered nearly 1,800 vehicles to distributors, a 35% year-on-year decrease but a 28% quarter-on-quarter increase. Total deliveries for the first nine months of 2025 reached 4,612 units, down 40% compared to the same period last year. Revenue for Q3 was $137 million, down 46% year-on-year but up 10% sequentially. First nine months revenue totaled $356 million, down 45% year-on-year. Gross margin improved to 8% in Q3, up three percentage points from the previous quarter and five percentage points from the same period last year. By category, lifestyle vehicles accounted for 77% of Q3 deliveries, contributing 72% of the first nine months' deliveries. By region, deliveries in the US sports car market began to recover after tariff disruptions, with UK vehicles having a favorable 10% tariff rate. Deliveries in the first nine months were primarily driven by China and Europe, with China's delivery growth outpacing the broader premium auto segment in the country.

Q: Could you elaborate a little bit more about the key highlights of the upcoming PHEV models? And maybe talk more about the strategic rationale behind those products?

A: The hybrid model features three firsts: best energy-efficient engine, best performance high hybrid system, and highest power motor. Strategic rationale includes China's premium vehicle market, especially plug-in hybrids/extended ranges being a large and growing segment; Europe's hybrid models representing a large and growing share of the auto market with tightening emission standards; Lotus being first to introduce such a model in the EU.

Q: Do you have any guidance on your gross margin for this year and next year?

A: Gross margin for full year 2025 is expected to remain at a high single-digit range. Next year, gross margin is projected to further improve due to PHEV launch, BEV sales growth, and put option with Lotus UK enhancing efficiency.