Li Auto Inc. (LI) shares traded modestly higher Friday morning as investors digested an interesting contradiction: the Chinese EV maker is expanding into AI wearables just as its core vehicle business hits turbulence.

The company confirmed it will introduce its first artificial intelligence glasses, called Livis, on December 3 during an evening launch event in Beijing, according to CnEV Post.

Beyond the Dashboard

The glasses let users bring Li Auto's voice assistant, Lixiang Tongxue, wherever they go in a lightweight wearable device. The assistant runs on the company's Mind GPT system and handles everyday questions, supports creative tasks, and includes a "Children Mode" designed for younger users.

Founder and CEO Li Xiang previewed the device earlier this week in a video, calling Livis the company's most advanced AI accessory to date, CnEV Post reported. He also mentioned the company is considering an AI-powered speaker to further build out its ecosystem for car owners and their families.

The Livis name is a clear nod to Jarvis, the fictional AI assistant from Marvel's Iron Man universe, signaling Li Auto's ambition to create a widely adopted personal AI companion for daily life. It's a bold vision, though one that will need to compete with the reality of the company's current financial picture.

The Vehicle Business Isn't Cooperating

This product launch comes as Li Auto faces mounting pressure from weak vehicle demand and rising costs. The company recently reported fiscal third-quarter revenue of 27.4 billion yuan, down 36.2% year-over-year. That translates to about $3.80 billion and slightly beat analyst projections.

Auto revenue declined 37.4% to roughly $3.6 billion as deliveries fell sharply. The automaker shipped 93,211 vehicles during the quarter, down from 152,831 in the same period last year.

What's Ahead

For the fourth quarter of 2025, Li Auto projects revenue between 26.5 billion and 29.2 billion yuan. That implies a year-over-year decline of 40.1% to 34.2%. The midpoint sits far below analyst expectations of $5.22 billion.

Management expects vehicle deliveries between 100,000 and 110,000 units next quarter, which would still represent a decline of more than 30% compared with last year.

Li Auto continues to face intense competition from Tesla Inc. (TSLA) and BYD Co. Ltd. (BYDDY) as China's EV market slows and pricing pressure remains elevated. Whether AI glasses can help the company diversify its way out of this slump remains an open question.

Price Action: LI shares traded higher by 0.27% to $18.48 in premarket action Friday.