Lotus Technology Reports Unaudited Second Quarter and First Half 2024 Financial Results

• Robust start in 2024, marking the strongest first half-year performance in the brand’s history.
• Balanced global allocation, with strong US deliveries1 contribution after the brand’s re-entry into the market.
• Launched bespoke services and continued growing technology-related income, which are expected to be potential contributors of profit margin in the future.
• Adjusted the annual delivery target due to near-term disruptions from trade uncertainties and tariff hikes.
• Initiated the“Win26” Plan aiming to achieve positive operating cashflow and EBITDA in 2026.

New York – August 28, 2024 – Lotus Technology Inc. (“Lotus Tech” or the “Company”), a leading global intelligent and luxury mobility provider, today announced its unaudited financial results for the second quarter and half year ended June 30, 2024.

Operating Highlights for the First Half of 2024
In the first half of 2024, the Company achieved total deliveries1 of 4,873 units, representing a 239% year-on-year (YoY) increase. The Company also achieved a balanced global allocation with each region contributing 20-30% of the total deliveries in the first half of 2024, powered by over 200 stores in prime locations worldwide. The US market recorded exceptional growth and contributed 26% of the total deliveries after Lotus’ re-entry into the market. The achievements reflect the Company’s steady transition from a traditional sportscar maker to an intelligent luxury mobility provider.

Deliveries¹ by Model Type

Deliveries¹ by Region

In the first half of 2024, technology-related revenue began to scale as the Company started to provide intelligent driving solutions and R&D services to multiple leading automotive brands. As the fleet of models equipped with state-of-the-art hardware continues to expand, paid software subscriptions is a potential growth driver in the future.

The Chapman Bespoke service which provides customer personalization, design customizations, limited collection editions, and one-off models, was also launched to cater to growing demand. Deliveries of bespoke models are expected to further boost the brand’s luxury positioning and contribute to the Company’s long-term premium gross margin.

After assessment of the evolving market conditions, and uncertainties posed by new tariff policies in US and EU, the Company has revised its delivery target for 2024 to 12,000 units. The Company launched the “Win26” plan, aiming to achieve positive EBITDA in 2026 by further optimizing its internal processes and structures, implementing overall cost measures, and recalibrating its product plans to cater to globally diversified markets.

Financial Highlights for the First Half of 2024

• Total revenues for the first half of 2024 were $398 million, a 206% YoY increase.
• Sales of goods were $383 million, a 207% YoY increase.
• Service revenues were $15 million, a 194% YoY increase.
• Gross margin for the first half was 13%, versus 5% for the first half of 2023, driven by the growth in margin from both sales of goods and service revenues.
• Gross margin of sales of goods for the first half of 2024 was 11%, versus 4% for the same period of 2023.
• Gross margin of service revenues for the first half of 2024 was 58%, versus 16% for the same period of 2023.
• Operating loss was $438 million for the first half of 2024, a 27% YoY increase.
• Net loss was $460 million for the first half of 2024. Excluding share-based compensation expenses, adjusted net loss (non-GAAP) was $424 million for the first half of 2024, a 20% YoY increase.
• Adjusted EBITDA (non-GAAP) was a loss of $382 million for the first half of 2024, a 15% YoY increase.

Key Financial Results

The table below summarizes key preliminary financial results for the half year ended June 30, 2024.

(in millions of U.S. dollars, unaudited)

^{(A) Non-GAAP measure. See “Non-GAAP Financial Measures” and “Appendix D – Unaudited Reconciliation of GAAP and Non-GAAP results (Adjusted net loss/Adjusted EBITDA)” for details and a reconciliation of adjusted metrics to the nearest GAAP measure.}

Recent Developments

• Delivery Updates:
  • Following Southeast Asia deliveries, Eletre (SUV) model started deliveries to new markets such as GCC, New Zealand, India, and Egypt.
  • Production orders for Eletre (SUV) model began for new markets such as Australia, Japan and Korea.
  • Emeya (GT, Sedan) model started deliveries in Europe.
  • Reservations of Emeya (GT, Sedan) model began in the GCC, Japan, Korea and Southeast Asia.
• Lotus Robotics provides solutions to multiple OEMs: Lotus Robotics, a subsidiary for intelligent automobility technologies development, licenses several leading automakers to provide them with its intelligent driving technology and solutions, including Lynk&Co and Farizon Auto.
• Strategic capital raised: As previously announced, in June 2024, the Company entered into a convertible note purchase agreement with an aggregate principal amount of approximately $110 million through a private placement from its existing strategic shareholder. 
• Dual Red Dot Awards: In June 2024, two Red Dot Awards in Product Design were given to the ground-breaking hyper electric vehicles: the Eletre (SUV), and the Emeya (GT, Sedan).
• Reuters Sustainability Awards 2024 Nomination: In July 2024, Lotus Tech was nominated as the finalist in the Reuters Sustainability Awards 2024 in the business transformation and Net Zero: operations transformation. Reuters Sustainability Awards are the world’s leading awards recognizing leadership in sustainable business.

CEO and CFO comments
"Through our unwavering pursuit to performance and excellence, we made steady progress with continuing operation growth in the first half of 2024," said Mr. Qingfeng Feng, Chief Executive Officer. "In the first half of 2024, the deliveries soared to nearly 4,900 vehicles, up 239% year-on-year. We achieved even more balanced distribution of deliveries in all key markets globally. The US market recorded extraordinary growth after Lotus’ re-entry into the market, contributing to 26% of total deliveries. We launched “Win26” plan to increase resilience, strengthen our brand, and strive for sustainable growth. Going forward, we will keep executing our plans, boosting our efficiencies and competitiveness, and remain committed to our customers, investors, and stakeholders.”

"We continued delivery of strong topline growth in the first half of 2024, with total revenues and gross profit up by 206% and 731% year-over-year respectively,” said Mr. Alexious Lee, Chief Financial Officer. "Gross margin for the first half of 2024 increased by 8 percentage points year-over-year but shrank 2 percentage points compared to year end of 2023 as a result of increased cost of Emira (sportscar) model due to inflation and seasonal variation in product sales mix. Our average selling price (ASP) remained above $100,000 in the first half of 2024 despite intensified competition. The execution of our “Win26” plan will enable the Company to achieve positive EBITDA and operating cash flow in 2026, to boost our financial performance, strengthen our balance sheet, and deliver our commitments to shareholders.”

Operating and Financial Results for the Second Quarter of 2024

• Total deliveries¹ for the second quarter of 2024 were 2,679 units, a 128% YoY increase.
• Total revenues for the second quarter of 2024 were $225 million, a 103% YoY increase.
• Gross margin for the second quarter of 2024 was 9%, versus 5% for the same period of 2023..
• Net loss for the second quarter was $202 million, a 4% YoY increase. Excluding share-based compensation expenses, adjusted net loss (non-GAAP) was $201 million for the second quarter of 2024.
• Adjusted EBITDA (non-GAAP) was a loss of $177 million for the second quarter of 2024, a 1% YoY decrease.

Deliveries¹ by Model Type

Key Financial Results

The table below summarizes key preliminary financial results for the second quarter in 2024.

(in millions of U.S. dollars, unaudited)

^{(A) Non-GAAP measure. See “Non-GAAP Financial Measures” and “Appendix D – Unaudited Reconciliation of GAAP and Non-GAAP results (Adjusted net loss/Adjusted EBITDA)” for details and a reconciliation of adjusted metrics to the nearest GAAP measure.}