CATL (300750): Q3 sales jump 58.6%, but profit grows only 14.5%, the slowest in nearly two years

CATL, the Chinese company that makes more electric-vehicle batteries than any other, reported third-quarter sales of RMB 165.2bn, up 58.6% on a year earlier. Profit attributable to shareholders rose only 14.5% to RMB 21.2bn, well below the 41.2% rise analysts had expected, and fell 5.8% from the previous quarter. $300750

What happened

On 20 October 2026 CATL's board approved the company's third-quarter report, and the company published the main figures in a notice filed with the Shenzhen Stock Exchange, where its shares trade under the code 300750 (it also has shares listed in Hong Kong). All figures here are in Chinese yuan (RMB) and come from CATL's own accounts, which follow Chinese accounting standards and are unaudited. Sales for July to September were RMB 165.221bn. Profit attributable to shareholders, meaning the profit that belongs to CATL's own shareholders after the share owned by others is removed, was RMB 21.246bn. For the first nine months of 2026, sales were RMB 442.137bn and profit attributable to shareholders was RMB 64.53bn.

Reuters reported that profit growth was the slowest in nearly two years, after a 36.5% rise in the second quarter, and attributed the slowdown to intense competition in the electric-vehicle battery market as China's car sales growth cooled. Reuters also noted that CATL's share of Chinese power-battery installations (batteries fitted to new vehicles) fell to 40.9% in September from 49.8% in January, while BYD, the main rival, rose to 21.1% from 17.4%. Over the first eight months of the year, CATL's share of global electric-vehicle battery use rose to 39.4% from 37.7%, according to the research firm SNE Research.

The numbers, explained

Start with growth against a year ago. Sales rose 58.58%, which means the year-earlier quarter was about RMB 104.2bn (165.221 / 1.5858). Profit attributable to shareholders rose 14.54%, so the year-earlier figure was about RMB 18.5bn (21.246 / 1.1454). Those two numbers explain the story: sales grew four times faster than profit. Compared with the previous quarter, profit fell from RMB 22.546bn to RMB 21.246bn, a drop of 5.77% (1.300 / 22.546), which CnEVPost reported as the first sequential decline of the year. Those year-ago and prior-quarter profit figures are our arithmetic from the reported growth rates, not numbers CATL printed in the notice.

A useful way to see the squeeze is net margin, the share of each yuan of sales that ends up as profit for shareholders. This quarter it was about 12.9% (21.246 / 165.221), or roughly 13 fen of every yuan. A year earlier it was about 17.8% (18.55 / 104.19), so margin fell by about 5 percentage points. The same pattern shows over nine months: profit of RMB 64.53bn on sales of RMB 442.137bn is a margin of about 14.6%, against roughly 17.3% implied for the first nine months of 2025. Net margin is our own measure and mixes operating profit with investment income and taxes, so it is a guide to direction rather than a precise read on battery pricing.

The analyst comparison matters too. According to Reuters, citing LSEG SmartEstimate (a forecast built from analysts' own estimates), profit was expected to rise 41.2%, and sales 60.2%. Sales landed slightly under that forecast and profit well under it. These are analyst expectations, not facts about the company, but they show why the result was read as a miss even though sales grew faster than 58%. Separately, CnEVPost reported that the company's cash from operations over nine months was RMB 61.63bn, down 23.6% from a year earlier.

Why it matters

CATL makes lithium batteries for electric cars, trucks and energy storage systems, which are large battery installations that store electricity for power grids. It earns money by selling those batteries to carmakers and utilities, so its results are a gauge of electric-vehicle demand and of the price it can charge. Rapid sales growth with slower profit growth suggests it is selling much more but keeping less of each sale, which is what stiffer competition and a shifting product mix can do. The company has said it expects energy storage to reach half of its revenue by 2030, up from about a quarter now, according to Reuters.

For customers and rivals, the picture is mixed. Shanghai Metals Market reported battery sales of over 260 GWh (gigawatt-hours, a measure of stored energy) in the quarter, with energy storage making up about 65 GWh, and a battery-swap network of 2,520 stations across 200 cities. Reuters reported that CATL unveiled new batteries for heavy trucks and widened supplies to overseas carmakers. BYD gaining share in China shows rivals are competing hard at home. For the wider sector, one quarter does not set a trend, but it does show that very fast sales growth does not guarantee matching profit growth in the battery business.

What to watch next

The full third-quarter report is published on the Shenzhen Stock Exchange and the Cninfo disclosure site, and holds the cost, margin and cash-flow detail that this note only touches. Monthly industry data will show whether the share shifts Reuters described continue: the China Automotive Battery Innovation Alliance (CABIA) publishes monthly installation data, and SNE Research publishes global tallies. Fourth-quarter and full-year 2026 results are the next scheduled results from the company, and we have not seen a confirmed date, so we do not state one. We leave out share-price moves because the sources we read gave differing figures.

• Attributable profit: profit belonging to the company's own shareholders
• Net margin: profit as a share of sales, our own calculation here
• GWh: gigawatt-hour, a unit of battery energy capacity
• Energy storage: large batteries that store electricity for grids and businesses

Sources

• CATL board resolution and Q3 headline figures, Shenzhen Stock Exchange (primary)
• China's CATL third-quarter profit growth slowest in nearly two years (Reuters via KFGO)
• CATL Q3 net profit reaches $3.16 billion, with growth trailing revenue (CnEVPost)
• CATL's third-quarter revenue rises 58.6% as net profit grows 14.5% (TechNode)
• CATL Q1-Q3 net profit RMB 64.53bn, Q3 battery sales top 260GWh (Shanghai Metals Market)