EHang Q3 Financials: “Revenues Increase 186 Percent from Q2, 248 percent Year on Year”

It appears the recent “short­ing attack” from Hin­den­burg Research only made a brief dent in the EHang share price and with these lat­est and pos­i­tive Q3 finan­cial results released this week, it is like­ly the assault will end (Thurs­day clos­ing share price USD15.80). With EHang recent­ly gain­ing Type Cer­ti­fi­ca­tion with com­mer­cial oper­a­tions start­ing ear­ly in the New Year, log­ic sug­gests, there should be a con­sis­tent increase in rev­enues from 2024 onwards.

Below are the Finan­cial and Oper­a­tional High­lights for Q3, 2023

: Total rev­enues were RMB28.6 mil­lion (USD3.9 mil­lion), rep­re­sent­ing an increase of 247.9 per­cent from RMB8.2 mil­lion in the third quar­ter of 2022, and an increase of 186.0 per­cent from RMB10.0 mil­lion in Q2.

: Gross mar­gin was 64.6 per­cent, rep­re­sent­ing a con­sis­tent­ly high gross mar­gin lev­el with a slight decrease of 1.3 per­cent­age points com­pared to 65.9 per­cent in the third quar­ter of 2022, but an increase of 4.4 per­cent­age points com­pared to 60.2 per­cent in the sec­ond quar­ter of 2023. The year-over-year decrease was main­ly due to changes in rev­enue mix. The quar­ter-over-quar­ter increase was main­ly due to high­er aver­age sell­ing price of EH216 series prod­ucts.

: Oper­at­ing loss was RMB70.0 mil­lion (USD9.6million), rep­re­sent­ing an improve­ment of 5.0 per­cent from RMB73.7 mil­lion in Q3 of 2022 and an improve­ment of 7.0 per­cent from RMB75.3 mil­lion in the sec­ond quar­ter of 2023.

: Adjust­ed oper­at­ing loss (non-GAAP) was RMB34.2 mil­lion (USD4.7 mil­lion), rep­re­sent­ing an improve­ment of 35.2 per­cent from RMB52.9 mil­lion in the third quar­ter of 2022, and an improve­ment of 33.3 per­cent from RMB51.3 mil­lion in the sec­ond quar­ter of 2023.

: Cash, cash equiv­a­lents, short-term invest­ments and restrict­ed short-term deposits bal­ances were RMB295.6 mil­lion (USD40.5 mil­lion) as of Sep­tem­ber 30, 2023.

: Sales and deliv­er­ies of EH216 series prod­ucts were 13 units, a notable increase com­pared with 4 units in Q3 of 2022, and 5 units in the sec­ond quar­ter of 2023.

EHang Suf­fers Anoth­er “Short­ing Attack” from a New York Based Research Group, Aim to Col­lapse Share Price 

Busi­ness High­lights for the Third Quar­ter 2023 and Recent Devel­op­ments

EH216‑S Received the World’s First Type Cer­tifi­cate for Unmanned eVTOL from CAAC

In Octo­ber 2023, EH216‑S, our self-devel­oped pas­sen­ger-car­ry­ing unmanned aer­i­al vehi­cle (UAV) sys­tem, obtained the type cer­tifi­cate (TC) from the Civ­il Avi­a­tion Admin­is­tra­tion of Chi­na (the CAAC). The EH216‑S mod­el has suc­cess­ful­ly demon­strat­ed its full com­pli­ance with the safe­ty stan­dards and air­wor­thi­ness require­ments set by the CAAC, there­by qual­i­fy­ing for com­mer­cial oper­a­tions involv­ing pas­sen­ger-car­ry­ing UAVs. As the world’s first TC for unmanned elec­tric ver­ti­cal take-off and land­ing air­craft (eVTOL), EH216‑S TC not only sets a bench­mark for the air­wor­thi­ness cer­ti­fi­ca­tion of inno­v­a­tive eVTOLs in Chi­na and over­seas, but also serves as an epoch-mak­ing mile­stone for com­mer­cial UAM oper­a­tions.

Under the guid­ance of the CAAC, EHang is steadi­ly mov­ing for­ward with EH216‑S pro­duc­tion in line with its TC. The first batch of the cer­ti­fied EH216‑S is sched­uled to roll off the pro­duc­tion line in the fourth quar­ter of 2023. The Com­pa­ny is also work­ing on the Pro­duc­tion Cer­ti­fi­ca­tion with the CAAC regard­ing its qual­i­fi­ca­tion for mass pro­duc­tions of EH216‑S.

CAAC Approved EHang Unmanned Air­craft Cloud Sys­tem for Tri­al Oper­a­tions

In August 2023, the CAAC approved the EHang Unmanned Air­craft Cloud Sys­tem (UACS) for tri­al oper­a­tions. EHang UACS fea­tures func­tions of man­age­ment of air­space, UAVs, flight plans and oper­a­tors, etc., enabling clus­ter man­age­ment of mul­ti­ple air­crafts with­in the same air­space, and ensur­ing safer and more reli­able oper­a­tions. EHang UACS pro­vides a sig­nif­i­cant safe­guard for oper­a­tional safe­ty and man­age­ment of its UAVs at scale

Strate­gic Part­ner­ship with Bao’an Dis­trict Gov­ern­ment of Shen­zhen on UAM and Deliv­ery of 5 Units of EH216‑S to Local Cus­tomer for Oper­a­tion Prepa­ra­tions

In July 2023, EHang reached a Mem­o­ran­dum of Under­stand­ing (MOU) with the Bao’an Dis­trict Gov­ern­ment of Shen­zhen Munic­i­pal­i­ty on a strate­gic part­ner­ship for UAM oper­a­tions. Both par­ties will joint­ly devel­op UAM use cas­es, sys­tems, and routes to build Shen­zhen as a nation­al low-alti­tude econ­o­my devel­op­ment demon­stra­tion city. A UAM Oper­a­tion Demon­stra­tion Cen­ter is being built at the OH Bay in Bao’an Dis­trict with the plan to launch aer­i­al tourism and sight­see­ing expe­ri­ence ser­vices with EH216‑S. In antic­i­pa­tion of flight oper­a­tions in Bao’an Dis­trict, EHang deliv­ered five units of EH216‑S to a local cus­tomer, Bol­ing, in Sep­tem­ber 2023. Bol­ing has expressed its intent to poten­tial­ly pur­chase an addi­tion­al 95 units of the EH216‑S for future use in Shen­zhen, as out­lined in a signed let­ter of intent.

EHang receives first type cer­ti­fi­ca­tion from China’s CAAC for its EH216‑S eVTOL air­craft

Strate­gic Part­ner­ship with Hefei Munic­i­pal Gov­ern­ment with US$100 Mil­lion Sup­port Plan

In Octo­ber 2023, EHang entered into a strate­gic coop­er­a­tion agree­ment with the Hefei Munic­i­pal Gov­ern­ment for joint devel­op­ment of a low-alti­tude econ­o­my ecosys­tem in Hefei, Chi­na. EHang plans to launch reg­u­lar UAV oper­a­tions in Luo­gang Cen­tral Park, Hefei, trans­form­ing it into a lead­ing UAM super aero­hub. The Hefei Munic­i­pal Gov­ern­ment intends to extend sup­port to EHang in var­i­ous forms with a tar­get amount of USD100 mil­lion. The sup­port will be pro­vid­ed either through the coor­di­na­tion or facil­i­ta­tion of pur­chase orders for a min­i­mum of 100 units of EH216 series prod­ucts, and/or by pro­vid­ing financ­ing sup­port. The spe­cif­ic tim­ing, amount and type of sup­port will be sub­ject to the defin­i­tive agree­ments.

EHang Euro­pean Urban Air Mobil­i­ty Cen­tre Opens in Spain

In Novem­ber 2023, EHang announced the open­ing of our first Euro­pean UAM Cen­tre in Spain. Locat­ed inside the Lleida–Alguaire Inter­na­tion­al Air­port, the cen­tre is the first-of-its-kind in Europe for unmanned eVTOL air­craft, set­ting a bench­mark glob­al­ly for the effec­tive inte­gra­tion of eVTOL oper­a­tions with air­port infra­struc­ture, air traf­fic man­age­ment sys­tems, oper­a­tional pro­ce­dures, and oth­er infor­ma­tion tech­nolo­gies.

USD23 Mil­lion PIPE Invest­ment from Strate­gic Investors to Strength­en Liq­uid­i­ty

In July 2023, EHang secured USD23 mil­lion of equi­ty invest­ment through a pri­vate place­ment from sev­er­al strate­gic investors. The gross pro­ceeds from the place­ment will be used for work­ing cap­i­tal and gen­er­al cor­po­rate pur­pos­es, enabling accel­er­a­tion of strate­gic plans for tech­nol­o­gy advance­ment, busi­ness devel­op­ment, and com­mer­cial oper­a­tions.

Strate­gic Invest­ment in Inx to Devel­op Sol­id-State Lithi­um Met­al Bat­tery Sup­ply Chain for eVTOLs

In Sep­tem­ber 2023, EHang strate­gi­cal­ly invest­ed in Shen­zhen Inx Tech­nol­o­gy Co., Ltd. (Inx), a sol­id-state lithi­um met­al bat­tery tech­nol­o­gy com­pa­ny in Chi­na, and plans to coop­er­ate with Inx on the research, devel­op­ment and pro­duc­tion of sol­id-state lithi­um met­al bat­ter­ies for EHang’s unmanned eVTOL prod­ucts. Our strate­gic invest­ment in Inx aligns seam­less­ly with EHang’s pur­suit of green­er, low-car­bon tech­nolo­gies, and is also part of the Company’s efforts to deploy and enhance our upstream bat­tery sup­ply chain.

Huazhi Hu

Huazhi Hu, EHang’s Founder, Chair­man and CEO com­ment­ed, “The third quar­ter reflects our excep­tion­al per­for­mance in mul­ti­ple aspects. A piv­otal mile­stone was the Type Cer­ti­fi­ca­tion for our EH216‑S, the first of its kind in the unmanned eVTOL indus­try around the world.”

He con­tin­ued, “To sup­port our com­mer­cial endeav­ours, we have forged strate­gic alliances with key enti­ties such as the Bao’an Dis­trict Gov­ern­ment of Shen­zhen and the Hefei Munic­i­pal Gov­ern­ment. These part­ner­ships are instru­men­tal in estab­lish­ing inno­v­a­tive projects like the UAM Oper­a­tion Demon­stra­tion Cen­ter in Shen­zhen and could facil­i­tate poten­tial sup­ports with a tar­get amount of USD100 mil­lion from the Hefei Munic­i­pal Gov­ern­ment.”

Adding, “As the first mover in the eVTOL indus­try, we will con­tin­ue com­mit­ting our­selves to deliv­er­ing safe, autonomous, effi­cient, and eco-friend­ly UAM solu­tions and ser­vices.”

Busi­ness Out­look

For the fourth quar­ter of 2023, the Com­pa­ny expects the total rev­enues to be approx­i­mate­ly RMB56 mil­lion, rep­re­sent­ing an increase of 257 per­cent year on year and an increase of 96 per­cent quar­ter over quar­ter. For the fis­cal year of 2023, the Com­pa­ny expects total rev­enues to be approx­i­mate­ly RMB118 mil­lion, up 166 per­cent from 2022.

(The above out­look is based on infor­ma­tion avail­able as of the date of this press release and reflects the Company’s cur­rent and pre­lim­i­nary expec­ta­tions regard­ing its busi­ness sit­u­a­tion and mar­ket con­di­tions. The out­look is sub­ject to changes, espe­cial­ly giv­en uncer­tain­ties and sit­u­a­tions relat­ed to cer­ti­fi­ca­tion, geopol­i­tics, eco­nom­ic land­scape, etc..)

For Full Finan­cial Q3 Report

https://ir.ehang.com/news-releases/news-release-details/ehang-reports-third-quarter-2023-unaudited-financial-results

For more infor­ma­tion

https://www.ehang.com/

(Images: EHang)