CATL Posts $3.16 Billion Q3 Profit as Costs Outrun Sales Growth

CATL closed the third quarter with 21.25 billion yuan ($3.16 billion) in net profit attributable to shareholders, a 14.54% gain over the same period a year ago. The number still marks a step down from the second quarter, when the battery giant booked 22.55 billion yuan — a 5.77% sequential decline.

The headline story sits in the gap between the top and bottom lines. Revenue for the quarter jumped 58.58% year-on-year to 165.22 billion yuan, roughly four times the pace of profit growth. Strip out one-off gains and the picture barely shifts: adjusted net profit came in at 18.86 billion yuan, up 14.86%.

Margins Feel the Weight of Expansion

The squeeze is visible further up the income statement. Cost of sales climbed 61.61% to 341.7 billion yuan across the first nine months, outpacing the 56.19% revenue increase that took turnover to 442.14 billion yuan.

Gross margin for the January-September stretch landed at 22.72%, about 2.59 percentage points below the 25.31% recorded a year earlier. Nine-month net profit rose 31.60% to 64.53 billion yuan.

Nine-Month Snapshot: 442.14 billion yuan revenue · 64.53 billion yuan net profit · 22.72% gross margin · 18.52 billion yuan R&D spend

Spending on research and development grew 22.89% to 18.52 billion yuan. Investment income, meanwhile, nearly doubled — up 73.11% to 9.07 billion yuan — which CATL put down to its share of profits from companies it holds stakes in.

Cash generation is the softer spot. Operating cash flow dropped 23.60% year-on-year to 61.63 billion yuan over the nine months. Receivables stood at 112.91 billion yuan at the end of September, 47.78% higher than at the close of last year, and inventories swelled 53.15% to 144.77 billion yuan. CATL links both buildups to its expanding business.

Still the Battery World’s Frontrunner

None of this dents CATL’s grip on the global market. Battery installations reached 333.0 GWh in the first eight months of the year, up 25.2%, per SNE Research. Market share climbed to 39.4% from 37.7%, leaving BYD in second place at 15.1%.

At home, the numbers keep climbing too. China’s September power battery installations hit 87.2 GWh, a 14.7% rise and a fresh 2026 high for the second month running, according to CABIA. Energy storage is moving faster still: sales of 73.5 GWh represented 104.4% growth and 33.0% of combined power and storage battery sales.

CATL retained the top spot in China’s power battery rankings for September with 35.49 GWh installed and a 40.92% share. The company’s reach is also widening beyond cars — Huawei’s smart car division recently signed on to CATL’s Choco battery swap ecosystem, targeting vehicles built on its Qiankun platform.