R&D Spending Far Exceeds Net Profit of the Same Period! How Will Observers View BYD's Half-Year Report?

"Auto Market Little Horn" latest news, BYD (002594.SZ) just released its 2026 first-half financial report tonight (August 28), with key core indicators remaining stable: Revenue 344.8 billion yuan, Net Attributable Profit 12.3 billion yuan, R&D Investment 28.9 billion yuan, Cash Reserves 167.4 billion yuan. Worth noting is that second quarter net profit increased 30% year-on-year, gross margin continued its upward trend, reaching 18.9%, setting a new high for nearly a year, profitability improved steadily, and resilient growth consolidated its industry position.

Current automotive industry competition intensifies. Relying on a stable operational foundation and continuously optimized business structure, BYD's development trend in the first half of the year continues to improve, further consolidating its industry leader status.

In the first half of the year, BYD's overseas sales reached 790,000 vehicles, up 68% year-on-year, covering over 120 countries and regions globally, topping the new energy vehicle brand sales charts in key markets such as the UK, Brazil, and Thailand. With the gradual release of overseas localized production capacity and the continuous improvement of the channel system, the overseas sector has become an important engine driving the company's performance growth.

At the same time, the high-end product matrix accelerated volume growth. The combined sales of the three brands Fang Cheng Bao, Denza, and Yangwang reached 228,000 vehicles, up 61% year-on-year, accounting for 12.6% of total sales. Among them, Fang Cheng Bao brand sales reached 160,000 vehicles, up 163% year-on-year; Denza brand also performed brilliantly, with June sales volume breaking 20,000 vehicles for the first time, with an average product price of 360,000 yuan; Yangwang is the brand with the fastest sales volume to break 10,000 among domestic new energy million-yuan luxury cars.

Internationalization and premiumization advanced on two lines, promoting continuous optimization of the company's product structure and steadily enhancing profitability. Second quarter net profit increased 30% year-on-year, gross margin reached 18.9%, setting a new high for nearly a year. Despite short-term pressure on net profit, upon detailed examination, it was mainly due to exchange losses caused by currency volatility this year. The profitability of the company's main business remained stable, and development resilience became more prominent.

Operating quality climbs steadily, with the core driver being continuous technical breakthroughs. In the first half of 2026, the company's R&D investment was 28.9 billion yuan, far exceeding the net profit of the same period, consecutively ranking as the "R&D King" on A-shares, with cumulative R&D investment exceeding 270 billion yuan.

High-intensity R&D investment is accelerating the conversion into perceivable technical results. The second-generation Blade Battery and Flash Charge technology released in March this year set a record for the fastest charging speed in global mass production, successfully conquering the world problems of "slow charging" and "difficult low-temperature charging", gaining recognition from the Ministry of Industry and Information Technology. Apart from technical breakthroughs, second-generation Blade Battery production capacity and Flash Charge station construction are also accelerating in sync. Relying on the "Flash Charge China" strategy, currently 10,000 Flash Charge stations have been built nationwide, covering 332 cities, and plans are to deploy 6,000 Flash Charge stations overseas within a year, helping global electrification leap forward development.

Significant progress has also been made in the intelligence field. After ensuring safety nets for intelligent parking, BYD took the lead in May in committing to safety nets for City Pilot, becoming the only enterprise in the world with a "Double Safety Net", promoting assisted driving popularization with practical actions. As of July 31, BYD's assisted driving vehicle fleet size exceeded 3.52 million vehicles. God's Eye generates over 220 million kilometers of data daily. The Xuanji A3 released in the same period is China's first self-developed 4nm process smart driving chip. From underlying chips to system software, BYD continues to promote vertical integration and full-stack self-research, leading global automotive industry intelligence transformation.

Practicing social responsibility, BYD answers with action. In the first half of 2026, BYD's total domestic tax payment was 22.3 billion yuan, far exceeding the net profit of the same period. In terms of sustainable development, the company firmly targets the goal of "achieving carbon neutrality across the entire value chain by 2045", with ESG performance ranking firmly in the top tier of domestic enterprises. From January to June, BYD new energy vehicle full lifecycle carbon emission reduction volume reached 23.17 million tons, equivalent to planting 386 million trees, contributing practical power to low-carbon transformation.

In the view of "Auto Market Little Horn", in the first half of 2026, the global automotive industry accelerated reconstruction, and industry profitability was generally under pressure. BYD managed to break out against the trend, and second quarter performance reached a new level. With technical results continuing to emerge in the second half of the year, the proportion of high-end models steadily rising, and globalization layout entering the harvest period, enterprise profitability and development potential will become more prominent, and full-year performance is expected to improve quarter by quarter and continue to climb. From technical breakthroughs to global layout, from high-end breakthroughs to responsibility and commitment, the company is reshaping growth logic with comprehensive competitiveness and leading global industry transformation.