XPeng (XPEV US) Buy: Product cycle gaining momentum

Research evidence excerpt

XPeng (XPEV US) Buy: Product cycle gaining momentum

ontinues to ramp up. Given

oversea margin remains materially above domestic levels, we expect oversea market to 52-WEEK PRICE (USD)

become an increasingly more important driver of both growth and profits in 2H26. 30.00

Physical AI commercialisation milestones are approaching. XPeng continues to 21.50

advance its broader physical AI strategy beyond smart EVs. Its robotaxi operation is

likely to commence in Guangzhou in 3Q, with public-road testing already underway. 06/25 12/25 06/2613.00

Meanwhile, the company’s next-generation humanoid robot is expected to be launched Target price: 26.80 High: 28.07 Low: 14.94 Current: 16.81

in 4Q, with production ramp-up and commercial delivery (originally from dealer Source: LSEG IBES, HSBC estimates

deployment) starting from year-end, and broader external delivery in 2027e. We believe

these milestones reinforce XPEV’s differentiated positioning as a physical AI tech Yuqian Ding*

platform, and provide diversified revenue drivers and long-term optionality value across Head of China Autos Research

autonomous mobility and embodied AI applications. The Hongkong and Shanghai Banking Corporation Limited yuqian.ding@hsbc.com.hk

+852 2288 5108

We trim our 2026e earnings estimates from profit to loss, mainly reflecting a

weaker volume outlook (from 610k units to 521k units), in line with our lower 2026 Li Yang* Analyst, China Autos

China EV growth outlook (see report China EV tracker, 18 May 2026). Our updated The Hongkong and Shanghai Banking Corporation Limited

2027-28 earnings forecasts sit 3-12% above Bloomberg consensus, as we stay li01.yang@hsbc.com.hk

+852 2288 6216

positive on the company’s medium-term growth backed by strong new model cycle

and growing physical AI commercialisation.