Microvast Holdings, Inc. (MVST)·Q3 2025 Earnings Summary

Executive Summary

• Record Q3 revenue of $123.3M, up 21.6% YoY, with gross margin expanding to 37.6% (+4.4pp YoY) and adjusted EBITDA of $21.9M; adjusted net profit was $11.9M as the company continues to prioritize higher-margin segments .
• Versus consensus: revenue beat ($123.3M vs $120.0M*, +2.7%), while normalized EPS modestly missed ($0.04 vs $0.05*); note both EPS and estimate coverage are thin (only 1 EPS estimate, 2 revenue estimates) which can amplify apparent beats/misses [GetEstimates Q3 2025]*.
• Guidance: FY25 revenue guidance maintained at $450–$475M; gross margin outlook raised from 32% to 32–35% (APAC explicitly targeted at 32–35%)—a constructive signal on mix/efficiency .
• Operational catalysts: Huzhou Phase 3.2 capacity expansion (up to +2 GWh/year) targeted to finish installation by year-end with initial production in Q1 2026; EMEA strength (64% of Q3 revenue) and Americas targeting >50% YoY revenue growth in 2025 .

What Went Well and What Went Wrong

What Went Well

• Strong top-line and margin execution: “Record set quarter revenue of $123.3 million… improving our gross profit margin to 37.6%” (CEO prepared remarks), demonstrating scale benefits and product mix improvement .
• Profitability metrics improved: operating profit of $13.0M; adjusted net profit of $11.9M; adjusted EBITDA of $21.9M—supported by higher utilization and cost controls .
• Strategic progress: partnership with Škoda Group validates technology for extreme-duty rail applications, expanding EU opportunities and future pipeline visibility .

What Went Wrong

• GAAP optics: despite operating profit, GAAP net loss of $1.5M driven by $12.6M adverse fair value change in warrant/convertible loan—an external, non-operating headwind to reported EPS .
• OpEx and litigations: quarterly OpEx rose to $33.5M (+22% YoY), including $5.6M litigation expense and $3.7M FX loss (Euro/RMB), partially offset by lower SBC—raising near-term cost friction .
• Working capital strain: YTD operating cash flow positive ($59.5M) but offset by a $41.2M increase in net receivables, signaling collections/timing risk amid rapid growth .

Financial Results

Revenue and EPS vs prior periods and consensus

Values with asterisks retrieved from S&P Global.

Margins and profitability

Segment breakdown (Q3 2025 vs Q3 2024)

KPIs

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “We are thrilled to announce a record set quarter revenue of $123.3 million… improving our gross profit margin to 37.6%… operating profit in third quarter of $13 million… Adjusted EBITDA of $21.9 million” — Yang Wu, CEO .
• “Phase 3.2 is anticipated to add up to 2 GWh of annual production capacity… initial production to begin in Q1 2026” — Yang Wu, CEO .
• “Partnership with Škoda Group… validates Microvast technology for extreme duty use cases and high safety rail applications… first prototype by end of 2026” — Yang Wu, CEO .
• “Gross margin improved by 4.4pp YoY to 37.6%, achieved through operational execution, higher margin end-market, increased utilization and cost controls” — Rodney Worthen, Interim CFO .
• “We affirm annual revenue guidance of $450–$475 million and raise full year gross margin target… APAC 32–35%” — Yang Wu, CEO .

Q&A Highlights

• The published transcript primarily contains prepared remarks and closing statements; a detailed Q&A section was not provided in the available materials .
• No additional guidance clarifications or tone changes beyond prepared remarks were published in transcript form .

Estimates Context

• Q3 2025: revenue $123.287M versus consensus $120.018M* (+2.7% beat); normalized EPS $0.04 versus consensus $0.05* (slight miss). Coverage was limited (EPS estimates: 1; revenue estimates: 2), which can increase variance and reduce reliability of “beat/miss” labeling [GetEstimates]*.
• Q2 2025 context: revenue $91.339M vs $107.677M* (miss); normalized EPS $0.05 vs $0.02* (beat), reflecting non-operating volatility and non-GAAP adjustments in reported metrics [GetEstimates]*.

Values retrieved from S&P Global.

Key Takeaways for Investors

• Mix-led margin expansion is intact; gross margin at 37.6% and full-year margin guide raised to 32–35%—a supportive input for medium-term EBITDA trajectory even as GAAP EPS remains sensitive to fair value accounting .
• Demand and regional execution are robust, with EMEA driving 64% of Q3 revenue and Americas targeting >50% YoY growth in 2025—watch U.S. pipeline conversion as a key upside lever .
• Capacity addition (Huzhou Phase 3.2, +2 GWh) underpins 2026+ growth; track installation completion by YE25 and initial production in Q1 2026 as a tangible catalyst .
• Working capital discipline remains a focus; receivables growth ($41.2M YTD increase) warrants monitoring for cash conversion amid rapid scaling .
• Litigation and FX costs pressured OpEx; the non-operating warrant/convertible fair value swings can mask underlying profitability—use adjusted metrics to track core performance .
• Normalized EPS modestly missed consensus despite underlying operational strength; expect estimate revisions to reflect higher gross margin trajectory and regional mix but remain mindful of limited coverage depth [GetEstimates]*.
• Near-term trading: constructive on margin/guide raise and EMEA momentum; medium-term thesis hinges on solid-state progress, capacity ramp execution, and Americas revenue scaling .

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Notes on non-GAAP: Adjusted metrics exclude SBC and changes in fair value of warrants/convertible loan; reconciliations provided in press release and slides .