Key Takeaways:
Li Auto Inc. shares plunged after its chief executive officer outlined a 15-year roadmap for artificial intelligence, with investors reacting negatively to a long-term vision that stretches to 2040. The company’s Hong Kong-listed stock closed down 13%, while its U.S.-listed ADRs also fell 3.75% in the latest session.
"Autonomous driving represents the first half of embodied AI race, while general-purpose humanoid robots will mark the second half of the race," Chairman and CEO Li Xiang said in a statement.
Li’s timeline divides the race into two halves. The first, autonomous driving, targets Level 3 capabilities by 2028 and fully autonomous Level 4 systems between 2028 and 2033. The second half focuses on humanoid robots, aiming for capabilities comparable to a six-year-old child by 2035 and approaching Artificial General Intelligence (AGI) around 2040. The ambitious vision contrasts sharply with the company's near-term outlook, with analysts projecting quarterly earnings per share to drop 100% year-over-year, according to Zacks Investment Research.
The market's sharp rebuke highlights investor anxiety over the immense, long-term capital expenditure required to achieve Li's vision, especially amid a brutal price war in China's electric vehicle market. With competitors like BYD and Tesla already pressuring margins, Li Auto's focus on a distant robotics future is testing investor patience. The company, which currently holds a "Sell" rating from Zacks, is now trading at a forward P/E ratio of 164.55, a significant premium to the industry average of 10.07.
The CEO's statement comes just before Li Auto is expected to report earnings on May 28, 2026. Consensus estimates project quarterly revenue of $3.14 billion, a decrease of 12% from the prior year. For the full year, however, revenue is forecast to grow nearly 17% to $18.42 billion, though earnings are expected to decline 20%. This divergence between a challenging present and a far-reaching, futuristic vision appears to be a key point of concern for the market.
The pressure on Li Auto is compounded by broader trends in China's EV sector. Competitor BYD, for example, has increasingly turned its focus to overseas expansion to offset weakening domestic demand and profitability. BYD’s first-quarter net income fell sharply, a trend analysts attribute to the intense domestic price competition that Li Auto also faces. Li's pivot to a narrative centered on AGI and robotics may be an attempt to differentiate itself, but for now, investors appear more concerned with immediate financial performance and execution risks.
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