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Li Auto's i9 Launch: Should Investors Buy, Sell, or Hold LI Stock?
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Key Takeaways
Li Auto launched the six-seat Li i9 at RMB369,800, with deliveries starting the same week.
Q2 2026 revenues fell 15.1% as deliveries and average selling prices declined during the model refresh.
Vehicle margin dropped to 9.4%, while Li Auto ended June with RMB87.5 billion in cash.
Li Auto Inc. (LI - Free Report) continues to strengthen its growth profile through product upgrades, proprietary technologies, charging infrastructure and overseas expansion. The company has completed its L-Series refresh and is expanding its BEV portfolio with models such as the new Li L6, refreshed Li i8, new-generation Li MEGA and flagship Li i9.
Launched on Sept. 16, 2026, the Li i9 is a six-seat flagship battery-electric SUV aimed at large families, with a starting price of RMB369,800 and deliveries beginning in the same week. Management has positioned the i9 alongside the Li MEGA to strengthen Li Auto’s presence in the premium family EV market. The model incorporates an 800-volt 5C high-voltage charging platform, Li Auto’s latest-generation proprietary electric motors and the company’s MACH M100 chip for advanced driving and embodied-AI capabilities, further highlighting its push toward fast charging and intelligent vehicle technologies.
Let’s look at LI’s fundamentals to analyze the stock better.
Li Auto Q2 Results Face Model-Refresh Headwinds
Li Auto delivered 98,330 vehicles in the second quarter of 2026, down 11.5% from 111,074 units in the year-ago period. Total revenues fell 15.1% year over year to RMB25.7 billion ($3.8 billion), while vehicle sales decreased 16.7% to RMB24.1 billion. The year-over-year decline in vehicle revenues primarily reflected lower deliveries and a lower average selling price resulting from a different product mix.
The results came amid an extensive refresh of Li Auto’s product portfolio. Despite intense competition and the model transition, the company remained the top-selling Chinese automotive brand in the RMB200,000-and-above new energy vehicle market in the first half of 2026. Its dual-energy strategy has also produced a more balanced portfolio, with extended-range electric vehicles and battery electric vehicles each accounting for roughly half of sales.
Li Auto upgraded its L-Series, introducing technologies such as its proprietary MACH M100 chip and MACH VLA model, 800-volt active suspension, a drive-by-wire chassis, and a third-generation range extender with 5C supercharging capabilities. Clearing older inventory, ramping up new models and transitioning sales policies temporarily disrupted operations during the refresh cycle.
Li Auto Swings to Losses Amid Margin Pressure
Profitability remained significantly below year-ago levels. Gross profit declined 53.3% year over year to RMB2.8 billion in the second quarter. Vehicle margin fell to 9.4% from 19.4% a year earlier, while gross margin decreased to 11% from 20.1%. Higher raw material and component costs, including chips and memory, put pressure on margins.
Operating expenses declined 2% year over year to RMB5.1 billion. Li Auto nevertheless posted an operating loss of RMB2.3 billion compared to an operating income of RMB827 million a year ago. Net loss was RMB1.7 billion compared with net income of RMB1.1 billion in the prior-year period.
The company maintained substantial liquidity, ending June with a cash position of RMB87.5 billion. Free cash flow remained negative at RMB1.3 billion, although this represented a significant improvement from negative RMB7.4 billion sequentially.
The company expects quarterly operating cash flow to remain relatively stable beginning in the third quarter as new-model deliveries increase. The company plans approximately RMB6 billion in capital expenditures for 2026, including investments in its supercharging network.
Li Auto Pushes Expansion Amid Execution Concerns
Li Auto is also building out its in-house battery capabilities. The company is developing battery cells, packs, battery-management systems and thermal-management technologies internally, which could help improve vehicle performance and provide structural cost advantages.
Li Auto is also expanding its 5C supercharging network, which had more than 4,100 stations and 22,800 charging stalls by the end of July. Meanwhile, the company is gradually entering overseas markets, including Central Asia, the Middle East and Europe, through product launches, local partnerships and assembly initiatives. These efforts could broaden LI’s long-term growth opportunities, although execution, regulatory and geopolitical risks remain.
Price Performance of LI vs. Industry, S&P 500, XPEV & NIO
Li Auto has lost 52.3% over the past year compared with the Zacks Automotive - Foreign industry’s 23.9% decline. The S&P 500 has risen 15.2% over the same time frame.
Among its peers, XPeng Inc. (XPEV - Free Report) and NIO Inc. (NIO - Free Report) have lost 50.3% and 47%, respectively, over the same period.
Image Source: Zacks Investment Research
Technical indicators show that LI has been trading below the 200-day simple moving average (SMA). The 50-day SMA is reading lower than the 200-day SMA, indicating a bearish trend.
The Zacks Consensus Estimate for 2026 and 2027 bottom line has been revised lower over the past 30 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for LI’s fiscal 2026 loss is currently pegged at 28 cents per share, indicating a 286.7% year-over-year deterioration. The estimate for 2027 stands at a loss of 48 cents per share, implying a 269.6% year-over-year deterioration.
Image Source: Zacks Investment Research
LI’s Valuation
LI is currently trading at a forward 12-month price-to-sales multiple of 0.64, above the industry average of 0.57. The forward 12-month price-to-earnings multiples for XPeng and NIO are 0.68 and 0.42, respectively. LI currently has a Value Score of D.
Image Source: Zacks Investment Research
Final Thoughts: Sell LI for Now
Despite Li Auto’s strong position in China’s premium NEV market and continued investments in new models, proprietary AI technologies, batteries and charging infrastructure, its near-term fundamentals remain under pressure.
Lower vehicle deliveries, weaker average selling prices and an unfavorable product mix drove a sharp decline in revenues and margins in the second quarter, while the company swung to sizable operating and net losses. Although free cash flow improved sequentially, it remained negative, and continued spending on R&D, product launches and charging infrastructure could keep cash generation under pressure.
Moreover, downward earnings estimate revisions point to weaker near-term expectations. LI also appears overvalued relative to the industry, with its forward 12-month price-to-sales multiple trading well above the industry average. Intense competition in China’s NEV market, execution risks surrounding the product refresh and overseas expansion, and continued margin pressure from higher input costs add to the uncertainty.
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Li Auto's i9 Launch: Should Investors Buy, Sell, or Hold LI Stock?
Key Takeaways
Li Auto Inc. (LI - Free Report) continues to strengthen its growth profile through product upgrades, proprietary technologies, charging infrastructure and overseas expansion. The company has completed its L-Series refresh and is expanding its BEV portfolio with models such as the new Li L6, refreshed Li i8, new-generation Li MEGA and flagship Li i9.
Launched on Sept. 16, 2026, the Li i9 is a six-seat flagship battery-electric SUV aimed at large families, with a starting price of RMB369,800 and deliveries beginning in the same week. Management has positioned the i9 alongside the Li MEGA to strengthen Li Auto’s presence in the premium family EV market. The model incorporates an 800-volt 5C high-voltage charging platform, Li Auto’s latest-generation proprietary electric motors and the company’s MACH M100 chip for advanced driving and embodied-AI capabilities, further highlighting its push toward fast charging and intelligent vehicle technologies.
Let’s look at LI’s fundamentals to analyze the stock better.
Li Auto Q2 Results Face Model-Refresh Headwinds
Li Auto delivered 98,330 vehicles in the second quarter of 2026, down 11.5% from 111,074 units in the year-ago period. Total revenues fell 15.1% year over year to RMB25.7 billion ($3.8 billion), while vehicle sales decreased 16.7% to RMB24.1 billion. The year-over-year decline in vehicle revenues primarily reflected lower deliveries and a lower average selling price resulting from a different product mix.
The results came amid an extensive refresh of Li Auto’s product portfolio. Despite intense competition and the model transition, the company remained the top-selling Chinese automotive brand in the RMB200,000-and-above new energy vehicle market in the first half of 2026. Its dual-energy strategy has also produced a more balanced portfolio, with extended-range electric vehicles and battery electric vehicles each accounting for roughly half of sales.
Li Auto upgraded its L-Series, introducing technologies such as its proprietary MACH M100 chip and MACH VLA model, 800-volt active suspension, a drive-by-wire chassis, and a third-generation range extender with 5C supercharging capabilities. Clearing older inventory, ramping up new models and transitioning sales policies temporarily disrupted operations during the refresh cycle.
Li Auto Swings to Losses Amid Margin Pressure
Profitability remained significantly below year-ago levels. Gross profit declined 53.3% year over year to RMB2.8 billion in the second quarter. Vehicle margin fell to 9.4% from 19.4% a year earlier, while gross margin decreased to 11% from 20.1%. Higher raw material and component costs, including chips and memory, put pressure on margins.
Operating expenses declined 2% year over year to RMB5.1 billion. Li Auto nevertheless posted an operating loss of RMB2.3 billion compared to an operating income of RMB827 million a year ago. Net loss was RMB1.7 billion compared with net income of RMB1.1 billion in the prior-year period.
The company maintained substantial liquidity, ending June with a cash position of RMB87.5 billion. Free cash flow remained negative at RMB1.3 billion, although this represented a significant improvement from negative RMB7.4 billion sequentially.
The company expects quarterly operating cash flow to remain relatively stable beginning in the third quarter as new-model deliveries increase. The company plans approximately RMB6 billion in capital expenditures for 2026, including investments in its supercharging network.
Li Auto Pushes Expansion Amid Execution Concerns
Li Auto is also building out its in-house battery capabilities. The company is developing battery cells, packs, battery-management systems and thermal-management technologies internally, which could help improve vehicle performance and provide structural cost advantages.
Li Auto is also expanding its 5C supercharging network, which had more than 4,100 stations and 22,800 charging stalls by the end of July. Meanwhile, the company is gradually entering overseas markets, including Central Asia, the Middle East and Europe, through product launches, local partnerships and assembly initiatives. These efforts could broaden LI’s long-term growth opportunities, although execution, regulatory and geopolitical risks remain.
Price Performance of LI vs. Industry, S&P 500, XPEV & NIO
Li Auto has lost 52.3% over the past year compared with the Zacks Automotive - Foreign industry’s 23.9% decline. The S&P 500 has risen 15.2% over the same time frame.
Among its peers, XPeng Inc. (XPEV - Free Report) and NIO Inc. (NIO - Free Report) have lost 50.3% and 47%, respectively, over the same period.
Technical indicators show that LI has been trading below the 200-day simple moving average (SMA). The 50-day SMA is reading lower than the 200-day SMA, indicating a bearish trend.
LI’s Falling Earnings Estimates Reflect Negative Sentiments
The Zacks Consensus Estimate for 2026 and 2027 bottom line has been revised lower over the past 30 days.
The Zacks Consensus Estimate for LI’s fiscal 2026 loss is currently pegged at 28 cents per share, indicating a 286.7% year-over-year deterioration. The estimate for 2027 stands at a loss of 48 cents per share, implying a 269.6% year-over-year deterioration.
LI’s Valuation
LI is currently trading at a forward 12-month price-to-sales multiple of 0.64, above the industry average of 0.57. The forward 12-month price-to-earnings multiples for XPeng and NIO are 0.68 and 0.42, respectively. LI currently has a Value Score of D.
Final Thoughts: Sell LI for Now
Despite Li Auto’s strong position in China’s premium NEV market and continued investments in new models, proprietary AI technologies, batteries and charging infrastructure, its near-term fundamentals remain under pressure.
Lower vehicle deliveries, weaker average selling prices and an unfavorable product mix drove a sharp decline in revenues and margins in the second quarter, while the company swung to sizable operating and net losses. Although free cash flow improved sequentially, it remained negative, and continued spending on R&D, product launches and charging infrastructure could keep cash generation under pressure.
Moreover, downward earnings estimate revisions point to weaker near-term expectations. LI also appears overvalued relative to the industry, with its forward 12-month price-to-sales multiple trading well above the industry average. Intense competition in China’s NEV market, execution risks surrounding the product refresh and overseas expansion, and continued margin pressure from higher input costs add to the uncertainty.
LI has a Zacks Rank #5 (Strong Sell) at present.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.