CATL shares fall 9.4% in Hong Kong after quarterly profit misses forecasts

Key Facts

Shares in Chinese battery maker CATL fell 9.4% to HK$373.2 during trading on Wednesday, October 21, 2026, according to Investing.com, after quarterly results missed analysts' expectations. The company posted third-quarter net profit of 21.2 billion yuan, Reuters reported, citing its financial results. Profit rose 14.5% from the same period a year earlier, slower than estimates ahead of the announcement. Weighted estimates from the London Stock Exchange Group had forecast net profit growth of 41.2%, according to the Reuters report. Dow Jones reported that the shares fell 7.8% in early Hong Kong trading the same day. The results showed revenue growing faster than profit, while analysts attributed pressure on profitability to factors including the sales mix, tax burdens and spending.

CATL's third-quarter revenue reached 165.2 billion yuan, according to Reuters, up 58.6% from a year earlier. Forecasts had pointed to revenue growth of 60.2%, leaving sales also below estimates, although the gap was smaller than the shortfall in profit growth. Net profit growth slowed from the second quarter, when the company posted a year-on-year increase of 36.5%, according to Reuters. For the first nine months of 2026, net profit rose 31.6% from the corresponding period a year earlier, according to Investing.com. Profit for that period totalled 64.53 billion yuan, covering the company's performance from January through the end of September. Nine-month revenue reached 442.14 billion yuan, up 56.2% year on year, with sales growth also outpacing profit growth over the period.

Jefferies analysts attributed some of the pressure on profit to a shift in CATL's sales mix, Dow Jones reported, citing their assessment of the results. They specifically pointed to a higher share of energy storage systems in sales in explaining the company's third-quarter performance. The analysts also cited tax burdens among the factors weighing on profitability, alongside increased spending on research and development. They summed up these factors as "a higher share of energy storage system sales, tax pressures and increased spending on research and development." Jefferies analysts added inventory write-downs to the list of factors weighing on the company's quarterly net profit, according to Dow Jones.

In China, CATL's share of vehicle battery installations fell to 40.9% in September, according to Reuters' report on the company's results. Its share of that market stood at 49.8% in January of the same year, before declining over the period through September. Globally, the company's share of electric vehicle battery usage rose during the first eight months of 2026, according to Reuters. That share reached 39.4% between January and August, compared with 37.7% in the same period a year earlier. CATL's expanding global presence coincided with a decline in its share of the domestic Chinese market, while the automakers it supplies with batteries include Tesla, BMW and Volkswagen, according to Dow Jones.

As part of its manufacturing expansion outside China, CATL began trial production at its new battery cell plant in the Hungarian city of Debrecen on September 22, 2026, according to a company announcement. The site produces battery cells and entered trial operations during the final month of the third quarter. In Egypt, the company announced the signing of a cooperation agreement with BME to support local battery pack manufacturing. CATL said the cooperation covers battery pack assembly and production through technology licensing. It described the agreement as a partnership aimed at "developing battery pack manufacturing in Egypt through technology licensing," as part of its efforts to expand manufacturing activities outside its home market.

Under another cooperation agreement CATL announced in October with Seres, plans include a production project inside the automaker's plant, according to CATL's announcement. The project's second phase targets annual production capacity of between 10 and 12 gigawatt-hours. The company said this phase was "planned to reach annual capacity of between 10 and 12 gigawatt-hours," as part of the cooperation announced between the two parties. On customer results, Tesla scheduled the release of its financial performance for the third quarter of 2026 after the market close on Wednesday, October 21, 2026, according to an investor relations statement. The announcement by the electric vehicle maker, which CATL supplies with batteries, marks the next opportunity to track the quarterly performance of one of the Chinese group's customers.