Bernstein SocGen Lowers XPeng Price Target to $18

Bernstein SocGen Group analyst Eunice Lee lowered the price target on XPeng (NYSE: XPEV) to $18 (from $20) while maintaining a Market Perform rating.

“Q2 losses widened on higher investments. XPeng reported Q2 revenue of RMB 19.7bn (+8.0% yoy and +51.5% qoq).

With vehicle revenue rising just 1% yoy, growth was primarily driven by services and other revenue, which nearly doubled yoy, including RMB1.2bn (Bern estimate) contribution from VW.

XPeng delivered 103k units, +0.1% yoy and +64.8% qoq, and ASP reached RMB 165k, +0.9% yoy and -6.0% qoq.

The sequential ASP decline primarily reflected a higher proportion of MONA M03 sales, partially mitigated by the launch of premium models (e.g.

GX) and strong momentum of overseas sales (over 20k deliveries in Q2 26 with ASP above €40k).

Overall gross margin held resilient at 20.7%, vs. 17.3% in Q2 25 and 20.6% in Q1 26, underpinned by steady vehicle margin (12.1%, vs.

14.3% in Q2 25 and 12.1% in Q1 26) and higher contribution from VW tech R&D service, and parts and accessories sales.

The yoy decline in vehicle margin was mainly attributable to rising raw material costs and a less favorable product mix.

Q2 26 R&D expenses reached RMB 2.9bn, increasing 32.1% yoy and 0.3% qoq, reflecting continued investment in new vehicle programs and AI development, while SG&A as a % of revenue reached 12.6% vs.

11.9% in Q2 25 and 14.5% in Q1 26.

Overall Opex ratio increased to 27.4% vs 23.9% in Q2 25 and 36.8% in Q1 26. As a result, XPeng recorded RMB-1.3bn net loss and -6.8% net margin, vs. -2.6% in Q2 25 and -13.7% in Q1 26.”

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