In the first half of 2026, EVE Energy released a half-year report with impressive growth.

During the reporting period, the company achieved operating revenue of 45.691 billion yuan, a year-on-year increase of 62.20%; net profit attributable to shareholders of listed companies was 3.301 billion yuan, a year-on-year increase of 105.66%. Among them, power battery revenue reached 17.278 billion yuan, surpassing energy storage and consumer batteries, becoming the company's largest business segment.

Beyond doubling profits, what is more worthy of attention is the change in power battery shipments. In the first half of the year, EVE Energy shipped 35.76GWh of power batteries, a year-on-year increase of 66.47%; the global power battery installation volume grew by about 20% during the same period. EVE Energy stated that its power battery installed capacity in vehicles has risen to the seventh globally.

01.

Breakthroughs in Two Tracks Open Growth Space

EVE Energy started in the consumer battery field, with lithium primary batteries, small lithium batteries, and cylindrical batteries being long-term traditional advantage sectors of the company. With the high-speed expansion of the new energy vehicle and energy storage industries, the company's strategic focus has continued to shift towards power and energy storage batteries, achieving a fundamental upgrade in business structure.

2026 first-half performance data clearly confirms the effectiveness of the transformation: consumer battery revenue was 6.411 billion yuan, accounting for only 14% of total revenue; power battery and energy storage battery revenues reached 17.278 billion yuan and 15.094 billion yuan respectively. The two core sectors together contributed nearly 70% of revenue, with power batteries officially topping the company's largest business segment, becoming the core standard for measuring corporate core competitiveness.

Growth momentum at the installation end is strong, outpacing industry-leading growth rates. In the first half of the year, EVE Energy's passenger car power battery installed capacity in vehicles increased by 40.4% year-on-year, and commercial vehicle power battery installed capacity in vehicles surged by 65.3% year-on-year. The growth rate of commercial vehicle batteries is significantly higher than the global average level of the power battery market, showing outstanding growth resilience.

The new energy power battery industry has currently entered a scaled stock competition, with leading companies firmly occupying the mainstream passenger car market share. Facing the industry landscape, EVE Energy did not blindly follow the red ocean competition in passenger cars, but precisely focused on two differentiated tracks: commercial vehicle batteries and 46-series large cylindrical batteries, respectively relying on scaled installation advantages and high-end customer breakthroughs to build its own growth barriers.

Commercial vehicles have the characteristics of high operating frequency, large electricity storage per vehicle, and long service cycles. Compared to ordinary passenger cars, fleet users value battery life, fast charging efficiency, and total lifecycle usage costs more, and battery performance directly determines operational returns. Relying on targeted technical R&D, EVE Energy has created a commercial vehicle exclusive "open-source battery", continuously optimizing in dimensions such as long life, fast charging performance, low-temperature adaptation, and intelligent diagnosis, precisely matching the operational scenario needs of commercial vehicles.

With excellent product adaptability, the company is deeply bound with top commercial vehicle clients, currently covering 90% of the top 10 OEM manufacturers in the domestic commercial vehicle market, achieving full coverage of the top 10 heavy truck clients. The products fully adapt to all categories of commercial vehicles such as micro vans, light trucks, heavy trucks, buses, and construction machinery, firmly holding the first echelon of commercial vehicle batteries.

If commercial vehicle batteries have built a solid foundation for the company, large cylindrical batteries are their core grip on entering the global high-end passenger car market. In the first half of 2026, EVE Energy's 46-series large cylindrical batteries officially entered the stage of scale delivery, successfully becoming the first battery supplier for BMW's new generation models, while continuing to support domestic all-new passenger car models. This product has extreme performance advantages, achieving 300 kilometers of range with a 10-minute fast charge, and can discharge stably in -35°C low-temperature environments, showing outstanding product competitiveness.

Large cylindrical batteries are recognized by the industry as the core route for next-generation power batteries, but from technology landing to stable mass production, multiple difficulties such as yield control, manufacturing efficiency, and product consistency need to be tackled. The BMW mass production project not only brings stable orders to the company but also realizes the automotive-grade, scaled practical verification of large cylindrical batteries, becoming a core sample case for the company to expand the global high-end automotive supply chain.

Overall, at this stage, commercial vehicle batteries provide certain installation increments, while large cylindrical batteries continue to optimize the passenger car customer structure and product value-added. The joint force of these two tracks will directly determine EVE Energy's space for ranking improvement in the global power battery industry.

02.

Scale Release Plus Capacity Expansion, Profitability and Cash Flow Pressure Emerge Prominently

Behind the high-speed business growth, EVE Energy is facing significant profitability and cash flow pressures, and growth quality needs repair. Data shows that the company's power battery shipment volume increased by 66.47% year-on-year, but the corresponding revenue growth rate was only 53.31%. Revenue per watt continues to decline, and the product profit space is continuously compressed.

The pressure on the profit side is obvious. In the first half of 2026, the gross margin of the company's power battery business dropped to 16.19%, a year-on-year decline of 2.97 percentage points; the gross margins of consumer batteries and energy storage batteries also dropped to varying degrees, driving the company's comprehensive gross margin down from 17.33% to 14.31%.

The decline in gross margin this round is mainly influenced by the superposition of three factors: the rebound in upstream raw material prices, price involution triggered by industry overcapacity, and the ramp-up of new capacity. For battery companies expanding capacity quickly, before new production lines achieve stable yields and high capacity utilization rates, they need to continue bearing fixed costs such as equipment depreciation, personnel salaries, and production line debugging. Although shipment releases can amortize some expenses, it is difficult to fully offset the profit losses brought by cost increases and product price cuts.

Cash flow indicators further highlight operational pressures. In the first half of 2026, the net cash flow from operating activities was -388 million yuan, turning from positive to negative year-on-year (2.373 billion yuan in the same period last year); during the same period, the company's construction expenditure on long-term assets such as fixed assets and intangible assets reached 5.343 billion yuan. Operating gaps plus capital expenditure jointly created a fund pressure of about 5.7 billion yuan.

The sharp rise in inventory is the core reason for the deterioration of cash flow. As of the end of June 2026, the company's net inventory reached 15.422 billion yuan, increasing by 87.16% significantly compared to the end of 2025. From the perspective of inventory structure, the book balance of raw materials increased by 2.5 billion yuan, semi-finished products and inventory products increased by 1.6 billion yuan and 2.5 billion yuan respectively. The growth of inventory stems from the company's strategic stocking and early locking of raw material sources on one hand, and from the acceleration of production stocking scale on the other hand due to capacity expansion and order delivery rhythm.

The profit end shows a structural differentiation feature. In the first half of the year, the company's non-recurring profit and loss was 850 million yuan, including 394 million yuan in equity swap gains and large government subsidies, superimposed with 1.183 billion yuan in investment income (accounting for 31.91% of total profit), forming positive support for profits. After deducting one-time gains, the company's net profit after deducting non-recurring items still reached 2.451 billion yuan, a year-on-year increase of 111.89%, and the main business profitability resilience remains. At the same time, the growth rate of the company's sales and management expenses is significantly lower than the revenue growth rate. The scale effect continues to be released, and the expense control ability is steadily improved.

In summary, the company's half-year report presents a typical "scale increases, efficiency rises, profitability is weak, cash flow is poor" pattern: the power battery business scale continues to break through, and refined management effectiveness has appeared, but industry competition and capacity expansion cycle pressures have led to gross margins and operating cash flows not being repaired synchronously.

03.

Start a High-Quality Growth Cycle

After continuous layout, EVE Energy has built a product matrix covering square lithium iron phosphate, ternary soft packs, large cylinders, and hybrid batteries, with comprehensive and balanced technical layout. Global capacity layout is advancing steadily. The Malaysia production base has been landed and put into production, and the Hungary power battery factory is being built in an orderly manner. Overseas localized capacity can help the company get closer to global mainstream automakers, effectively avoid tariff barriers, and adapt to supply chain compliance requirements, laying a solid foundation for globalization expansion.

Frontier technology R&D is also speeding up. The company has laid out the all-solid-state battery track in advance. In March 2026, the "Longquan No. 4" 60Ah all-solid-state battery went offline smoothly and is planned to be primarily equipped with hybrid vehicles. Currently, solid-state batteries are still in the product verification stage and are difficult to contribute revenue in the short term. In the future, commercial vehicle batteries and large cylindrical batteries will still be the core forces determining the upper limit of the company's power battery business.

The current power battery industry has said goodbye to the rough development stage of simply competing in capacity expansion and scale. Leading companies continue to squeeze the industry profit space with their huge customer base and extreme manufacturing scale. Automotive manufacturers' cost reduction requests continue to transmit to the upstream battery end. Simple capacity expansion can only improve delivery capabilities and cannot continuously improve profitability.

In the next stage, EVE Energy's core proposition will shift from "scaling up" to "realizing profits". The subsequent core observation dimensions focus on four points:

First, whether the gross margin of power batteries can stabilize and rebound to repair the profitability fundamentals;

Second, whether commercial vehicle and large cylindrical high-end products can continue to increase volume, optimize the overall product structure, and increase the proportion of high-margin products;

Third, whether high-level inventory can be smoothly digested to improve operating cash flow and alleviate fund pressure;

Fourth, relying on the BMW benchmark project, continuously expand more international automaker mass production orders, and convert the technical advantages of large cylindrical batteries into sustainable revenue and profit increments.

The performance in the first half of 2026 has fully verified that EVE Energy has the core capability for large-scale and stable delivery of power batteries. In the future, whether the company can achieve high-quality development with stable profitability and abundant cash flow on the basis of continuous scale growth will determine its long-term position and growth space in the global power battery track.