Performance is soaring across the board! Profits are comparable to a money printer, CATL is once again entering a major upward wave!

How will the all-domain incremental business expand the market boundaries for CATL?

This is the 1291st original article from New Energy Ahead.

Explosive, explosive to the point of being unbelievable. After reading CATL’s annual report, one can only sigh and realize why the market loves to chase technology, because the growth potential of many tech leaders is truly immense.

01

Elephant Dancing, Elegantly Terrifying

In 2025, the company achieved a revenue of approximately 423.7 billion yuan, a year-on-year increase of 17.04%; the net profit attributable to shareholders of the listed company was about 72.2 billion yuan, a year-on-year increase of 42.28%!

Let’s not forget that CATL has already become a giant-level company with revenues in the hundreds of billions and net profits exceeding 50 billion. Yet, under such a high base, the company can still grow rapidly, especially in net profit. This is not what one would expect from a company with net profits in the hundreds of billions; this is what it means for an elephant to dance!

Looking deeper, the situation is even more astonishing. In Q4, revenue reached 140.6 billion, with a year-on-year growth rate of 37%; net profit was 23.167 billion, with a year-on-year growth rate of 57.13%, both significantly exceeding market expectations—it’s like a printing press!

Such an astonishingly unexpected performance is primarily due to the higher-than-expected shipment volume. In Q4, the overall shipment of lithium batteries reached 226 GWh, with a year-on-year growth rate of 56%, far surpassing market expectations. Breaking it down, the shipment of power batteries reached 192 GWh in Q4, with a quarter-on-quarter growth of 48%!

If one has any concept of the electric vehicle industry last year, it is clear just how incredible CATL’s power battery shipment volume is. Last year, the quarter-on-quarter growth rate of domestic electric vehicle sales had already fallen to around 10%-15%, yet CATL’s battery shipment volume greatly outperformed the overall market. The specific reasons will be elaborated below.

Surprisingly, the shipment volume for energy storage in Q4 was only 34 GWh, with almost no quarter-on-quarter growth, which is quite odd. After all, the energy storage market was still hot in Q4 last year, with different statistical sources showing a quarter-on-quarter growth rate of around 15%-20%. As the global leader in energy storage, CATL should not be lagging behind the overall market.

A more likely reason is still insufficient production capacity. The new capacity planned for the Shandong Jining base, which exceeds 100 GWh, has not yet been released, and the earliest it can happen is in the first quarter of this year, primarily aimed at alleviating the pressure on energy storage capacity. This can also be verified by the capacity utilization rate, which reached 96.9% for the whole year of 2025. If only looking at the second half of the year, it entered a state of full production, reaching 102.6%! The data from 2024 showing a capacity utilization rate of only 70% feels like it was just yesterday, and suddenly it switches to full capacity, creating a sense of almost surreal transition.

Additionally, there are many orders that have been issued but have not yet been confirmed as received. By the end of the year, the inventory of issued goods reached over 40 billion, a significant increase from over 24 billion at the beginning of the year. This is also an important reason why energy storage did not meet expectations, but at the same time, it forms an important guarantee for this year’s performance.

The gross profit margin continues to improve, reaching 26.27% for the entire year, nearly a 1 percentage point increase compared to 2024. In Q4, it even reached 28.2%, with a quarter-on-quarter increase of 2.4 percentage points, and both power batteries and energy storage batteries are experiencing improvements in gross profit margins. The key is that this was achieved even as the price of lithium carbonate rose from 70,000-80,000 yuan/ton in Q3 to 80,000-100,000 yuan/ton in Q4, while CATL’s battery unit prices remained basically stable quarter-on-quarter, showcasing CATL’s scale and management advantages.

As for why the unit price of batteries held steady in Q4 despite a significant increase in upstream raw material prices, it is likely related to the increased proportion of lithium iron phosphate, combined with the fact that there is a certain transmission cycle for price linkage between power battery manufacturers and downstream customers. Many orders in Q4 were deliveries of previous stock orders, which led to the final unit price not reflecting the rise in upstream raw material costs.

02

The Expectation Gap of “King Ning”

In summary, the situation is as follows. Overall, CATL’s 2025 financial report absolutely exceeds expectations, truly deserving the nickname “Ning Wang”!

Previously, New Energy Ahead emphasized that CATL had a significant expectation gap and was the only domestic power battery manufacturer still offering alpha returns, and this logic was once again validated in the 2025 annual report.

Many were concerned that as the penetration rate of electric vehicles continued to rise, if the overall penetration rate of electric vehicles abroad did not improve, then CATL’s growth potential would face a ceiling. This was also why CATL’s secondary market performance struggled after Q3.

But with this annual report, we see that although domestic penetration rates indeed face slowing pressure, the increase in the penetration of large-capacity batteries, coupled with the company’s own rising market share, not only effectively hedged against the overall market decline but also significantly outperformed it. Even for CATL’s net profit, it would not be an exaggeration to say that it has harvested the entire electric vehicle market. One can only cry, “Why do I have to toil to make cars when just selling batteries is so profitable?”

Now, CATL’s market value exceeds 170 billion yuan, with revenue surpassing 400 billion yuan, which naturally raises concerns about its future growth potential. Regarding this, New Energy Ahead has already provided an answer— the theory suggests that all drive systems can be electrified, or more aggressively, “everything can be electrified.”

CATL’s official stance is: all-domain increment.

03

The Era of All-Domain Increment

In management discussions, a more detailed explanation was provided:

“This year, our revenue structure and growth quality continued to optimize, with power and energy storage battery shipment volumes leading the world, and lithium battery sales increasing nearly 40% year-on-year to 661 GWh. The ‘all-domain increment’ business engine is beginning to take shape.

This year, our products and services are expanding into broader scenarios— in the cloud, in mines, in rivers and lakes, in deserts, in zero-carbon parks, and in data centers. CATL is continuously injecting strong momentum into the development of China and the world.

Looking ahead, rather than simply copying past successes, CATL is more committed to expanding the boundaries of new energy, pushing the industry from “localized breakthroughs” to “all-domain increments.”

From fundamental skills to innovative breakthroughs, from products to services, and then to ecosystem building, we are continuously expanding the application boundaries of electrification. Our products have extended from passenger vehicles to commercial vehicles, electric ships, and electric aircraft: in the field of new energy heavy trucks, the “Tianxing” battery has become a mainstream choice; in electric ships, nearly 900 vessels equipped with CATL batteries are at sea, and pure electric ships will soon sail into the ocean; in low-altitude mobility, our subsidiary Peak Flight’s 2-ton eVTOL has completed multiple complex environment flight tests, and the world’s largest 5-ton eVOTL has completed its first public flight.

We are actively promoting the evolution of batteries from “products” to “services,” enhancing end-user experience through vehicle-to-grid separation and battery swapping models, and working with partners like Sinopec to build efficient, convenient, and economical energy replenishment networks in two major scenarios: convenient charging for passenger vehicles and trunk logistics for commercial vehicles. By the end of 2025, a total of 1,325 battery swapping stations will have been built, including over 1,000 Chocolate swap stations and over 300 Qiji swap stations, and jointly launching swap-compatible vehicle models with GAC, Changan, FAW, SAIC, Chery, FAW Liberation, and Shaanxi Heavy Truck.

Throughout human civilization’s development, technological revolutions have always been accompanied by energy revolutions, and energy utilization efficiency is a key variable for civilization leaps.

In the next-generation energy systems dominated by renewable energy, batteries will no longer be just components of transportation or energy storage devices, but will become the fundamental units supporting buffering, stabilization, and dispatching of energy systems. New energy will no longer be a cyclical investment product but a long-term, systematic infrastructure.”

Understanding this point provides a solid foundation for CATL’s future.

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Author’s note: Personal opinions only, for reference.