TLDR
- BYD’s Q1 net profit dropped 55.4% year-on-year to 4.09 billion yuan, the steepest fall since 2020
- Revenue fell 11.8% to 150.23 billion yuan â the third straight quarterly decline
- Results came in line with or slightly above market expectations, lifting Hong Kong-listed shares 3.9%
- Domestic sales declined for a seventh straight month in March as subsidies were withdrawn
- Exports made up roughly 45% of total Q1 vehicle sales, with BYD targeting 1.5 million overseas sales in 2026
BYD posted its worst quarterly profit decline in six years, but Wall Street wasn’t too surprised â and the stock moved higher because of it.
BYDâs Q1 net profit dropped 55% YoY to RMB 4.1B ($597M) as domestic demand cooled.
Offsetting the dip, overseas sales jumped 50% to 320K units, anchoring both margins and growth. $BYDDY #ChinaEV https://t.co/2pQSEz73cS
— ChinaEV Home (@CNEVhome) April 29, 2026
The Chinese EV giant reported Q1 net profit of 4.09 billion yuan ($600 million), down 55.4% from the same period last year. Revenue came in at 150.23 billion yuan, an 11.8% drop and the third consecutive quarterly decline.
Despite the ugly headline numbers, the results were broadly in line with analyst expectations. Revenue even beat estimates of around 140 billion yuan. That “better-than-feared” read was enough to push BYD’s Hong Kong-listed shares (1211) up 3.9% to HK$107.70 on Wednesday, well ahead of the Hang Seng’s 1% gain. Mainland shares added over 2%.
The domestic picture remains tough. Beijing has scaled back trade-in subsidies for entry-level EVs and plug-in hybrids, squeezing demand at the lower end of the market â exactly where BYD has historically been strongest, with most models priced under 150,000 yuan.
Competition at home is intensifying too. Rivals including Geely and Leapmotor are pushing harder into BYD’s core budget segments, adding more pressure to margins already under strain from an ongoing price war.
BYD’s overall domestic sales fell for a seventh straight month in March.
Eugene Hsiao, head of China equity strategy at Macquarie Capital, noted that BYD needs domestic volumes to pick up in Q2 and show a sustained recovery in Q3 before overall profits can meaningfully improve.
Exports Providing a Lifeline
Overseas sales are doing the heavy lifting right now. Exports accounted for roughly 45% of BYD’s total 700,463 vehicle sales in Q1 â a number that speaks to just how aggressively the company has been pushing into international markets.
BYD has said it is “highly confident” of hitting its 2026 overseas sales target of 1.5 million vehicles, which would represent growth of over 40% from 2025 levels. Morningstar analyst Vincent Sun projects exports will rise 25% to 30% this year, with total vehicle sales growing around 12%.
Sales in Europe, Asia, and the Middle East have been gaining pace, and international expansion remains a stated strategic priority. The company also benefits from better margins on overseas sales, partly because it isn’t locked in the same brutal domestic price war abroad.
That said, Macquarie’s Hsiao warned that overseas growth alone may not fully offset domestic weakness if current trends continue at home.
BYD Pushes Premium and Faster Charging
BYD is also trying to move upmarket. At the Beijing auto show last Friday, it kicked off pre-sales for its Datang full-size electric SUV, entering a segment increasingly crowded with Chinese brands taking aim at European premium names.
The company is also doubling down on ultra-fast charging technology, a move aimed at converting petrol car drivers who have been reluctant to switch due to charging time concerns.
BYD overtook Tesla as the world’s largest EV seller in 2025. Its Q1 2026 results reflect the growing tension between a weakening home market and an expanding international footprint.
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