Chinese power battery manufacturer Gotion High-Tech expects first-half 2026 net profit attributable to shareholders to reach 1.2 billion to 1.55 billion yuan, up 227% to 323% year-on-year. However, the company acknowledges that the surge is driven primarily by non-recurring investment gains rather than core battery operations. Net profit excluding non-recurring gains is expected at just 85 million to 120 million yuan, up 17% to 65% year-on-year.
Profit Guidance: Surging Two- to Three-Fold Year-on-Year
On August 4, 2026, Gotion High-Tech released its first-half 2026 earnings forecast. The company expects:
| Metric | H1 2026 Forecast | H1 2025 Actual | YoY Change |
|---|---|---|---|
| Net profit attributable to shareholders | 1.20–1.55B yuan | 366.63M yuan | +227%–+323% |
| Net profit excl. non-recurring items | 85–120M yuan | 72.87M yuan | +17%–+65% |
| Basic EPS | 0.66–0.85 yuan | 0.20 yuan | — |
The surge in net profit attributable to shareholders is particularly striking — the upper bound of 1.55 billion yuan represents year-on-year growth of over 3 times. But a closer look at the profit structure reveals a notable divergence:
- Net profit attributable to shareholders: 1.20–1.55 billion yuan
- Net profit excluding non-recurring items: only 85–120 million yuan
The gap between the two exceeds 1.1 billion yuan, indicating that over 80% of reported profit comes from non-recurring gains rather than the core battery business.
Profit Breakdown: Investment Gains Take Center Stage
Gotion High-Tech explicitly states in its forecast that the main driver of profit growth is investment-related gains, not core battery operations. These include:
- Equity investment gains
- Fair value changes in financial assets
- Government subsidies
- Other non-recurring items
The company attributes improvements in its core operations to the following factors:
- Accelerated commercialization of R&D projects: Earlier R&D investments entering the return phase
- Product upgrades: Higher proportion of high-value-added products
- Customer mix optimization: Increased large-customer orders and improved customer quality
- Domestic and overseas market expansion: Steady market share growth supporting battery business expansion
However, it is worth noting that the company did not disclose specific first-half revenue figures, shipment volumes, or segment-level profitability. These key data points are expected in the full interim report.
Net Profit Excl. Non-Recurring Items: The Real State of Core Business
Net profit excluding non-recurring items better reflects the true profitability of the company's core battery business:
| Metric | H1 2026 Forecast | H1 2025 | YoY Change |
|---|---|---|---|
| Net profit excl. non-recurring items | 85–120M yuan | 72.87M yuan | +17%–+65% |
The growth rate of net profit excluding non-recurring items (17%–65%) is far lower than that of net profit attributable to shareholders (227%–323%). This substantial gap indicates:
- The core battery business is indeed improving, but at a relatively modest pace
- The "story" of the profit surge is mainly written by non-recurring items
- Investors need to distinguish between "book profit" and "operating profit"
For a power battery enterprise, the scale and growth rate of net profit excluding non-recurring items are more reliable indicators of its core business health. Gotion High-Tech's upper-bound net profit excluding non-recurring items of 120 million yuan remains at a relatively low level among top-tier battery companies.
Industry Context: Intensifying Profit Divergence Among Battery Makers
Gotion High-Tech's earnings forecast reflects a key trend in the power battery industry in 2026: profit divergence is intensifying.
Headline companies (such as CATL and BYD), leveraging scale advantages, technology moats, and customer lock-in capabilities, have maintained strong profitability. Second-tier enterprises face greater profit pressure:
- Raw material price fluctuations compress profit margins
- Downstream automakers continue to press for price cuts
- Overcapacity leads to cutthroat price competition
- High R&D investment is difficult to translate into short-term profits
Against this backdrop, the modest growth of Gotion High-Tech's net profit excluding non-recurring items reflects the common situation of second-tier battery companies during the industry shakeout period — limited core business profitability, relying on investments, government subsidies, and other non-recurring items to thicken reported profits.
Notes for Investors and Purchasers
For different stakeholders following Gotion High-Tech, this earnings forecast sends different signals:
For investors:
- Distinguish between net profit attributable to shareholders and net profit excluding non-recurring items
- Pay attention to the sustainability of non-recurring gains
- Await core operating data such as revenue and shipment volumes in the full interim report
For automotive OEM purchasers:
- Gotion High-Tech's battery business continues to grow, with production capacity and delivery capability assured
- The company is expanding domestic and overseas markets; supply chain stability is worth monitoring
- Product upgrades and technology R&D progress can be further tracked
For overseas buyers:
- Gotion High-Tech is a significant player in China's power battery industry
- The company continues to push global layout; overseas factory progress is worth tracking
- More industry data and supplier information available at EX1000.COM
