CATL third-quarter profit rises 14.5%, misses analyst forecasts
Key Facts
Chinese electric vehicle battery maker CATL's net profit rose 14.5% year on year in the third quarter of 2026 to 21.2 billion yuan, according to Reuters. The increase fell short of analysts' forecasts for growth of 41.2%, according to weighted estimates from London Stock Exchange Group cited by the agency. Profit growth slowed from the second quarter, when the company reported a year-on-year increase of 36.5%. Reuters described third-quarter profit growth as "the slowest in nearly two years". Revenue rose 58.6% from the same period a year earlier to 165.2 billion yuan. It also missed forecasts for a year-on-year increase of 60.2%.
Reuters linked the slowdown in profit growth to intensifying competition in the electric vehicle battery market as growth in Chinese car sales slowed. It said the company was affected by "fierce competition in the electric vehicle battery market as car sales growth in China slows". CATL faces these conditions while accounting for 39.4% of global electric vehicle battery usage, according to industry data cited by the agency for the first eight months of 2026. In China, its share of the power battery installation market stood at 40.9% in September, according to the same industry data. That domestic share and the company's global presence place its third-quarter results in the context of competition in the Chinese and global battery markets.
The third-quarter results followed a decline in the gross profit margin of the energy storage battery business in the first half of 2026, according to Reuters. The margin stood at 24.0%, compared with 25.5% in the same period a year earlier, in a comparison specific to the storage business. In its July earnings announcement, CATL also unveiled a plan to repurchase between 20 billion and 40 billion yuan of A-shares. During trading on 21 October 2026, the company's Hong Kong shares stood at HK$375.60, down 8.79%, according to Investing.com. The price was recorded during the session, with the Hong Kong shares trading lower as results showed slowing profit growth.
On manufacturing outside China, CATL announced the start of trial battery cell production at its plant in Debrecen, Hungary, on 22 September 2026. The company said trial operations had begun at the new cell plant as part of its European manufacturing expansion. The expansion comes alongside a collaboration announced in October with Seres to expand manufacturing at the partner's plant. According to CATL, the second phase of this collaboration targets annual production capacity of between 10 and 12 gigawatt-hours. Describing the next phase, the company said "the second phase is planned to have annual capacity of between 10 and 12 gigawatt-hours".
The cooperation agreement with Seres goes beyond expanding manufacturing to exploring overseas markets, according to CATL's October 2026 announcement. The regions identified by the company include Europe, the Middle East and Central Asia. CATL said the collaboration includes "exploring overseas markets, including Europe, the Middle East and Central Asia". The announced cooperation plans thus combine increased manufacturing capacity at the partner's plant with work on markets outside China. The European aspect of this agreement adds to CATL's manufacturing expansion in Hungary, where trial battery cell production had already begun in September.
Over the longer term, CATL expects energy storage to account for half of its global sales by 2030, according to a company official's remarks reported by Reuters and carried by Investing.com in June 2026. The business accounted for 25% of global sales when the remarks were made. The official said "energy storage will account for half of the company's global sales by 2030, up from 25% currently". The target concerns the business's contribution to the company's global sales, while first-half results showed its gross margin declining from a year earlier. The company continues to target 2030 for achieving that share of its sales mix.