WeRide Inc. (NASDAQ: WRD) shares took a hit on Wednesday, even after the autonomous driving company posted some pretty impressive second-quarter numbers. The stock was down about 9.6% at $5.71 in afternoon trading, which might seem odd given the growth story, but let's dig into the details.
In U.S. dollar terms, the company's loss per share stayed flat year-over-year at 18 cents. Revenue, though, jumped 92% to $34.15 million. In local currency, revenue climbed 82% to 232 million Chinese yuan, driven by growth across its L4 autonomous driving, L2/L3 advanced driver-assistance systems, and international operations.
WeRide's Overseas Expansion Is Paying Off
The big story here is international growth. Overseas revenue surged 164% and now accounts for nearly 40% of total revenue. WeRide is seeing strong traction in the Middle East, Europe, and Southeast Asia.
L4 revenue rose 47% to 125 million Chinese yuan, mainly thanks to higher Robotaxi revenue. Gross profit jumped 143% to 87 million Chinese yuan, and gross margin hit a record 37.5%, up from 28.1% a year earlier. That improvement reflects growth in higher-margin, asset-light L4 services and a stronger mix of AI services.
The company ended June with about 5.4 billion Chinese yuan in cash and other liquid financial resources, so it's not exactly running on fumes.
Robotaxis Rolling Out Across the Globe
WeRide is making big moves in the Middle East and Europe. Management estimates that annualized technology-service revenue per Robotaxi could exceed $50,000 at normalized driverless utilization. That's a pretty compelling unit economics story if it holds up.
In the Middle East, WeRide operates fully driverless Robotaxi services in Abu Dhabi and Dubai. Its operating zone in Riyadh now covers more than 70% of core urban areas, including airports and central business districts. In Europe, the company announced Robotaxi deployments in Madrid and Zurich, and it plans to launch autonomous shared mobility services in Denmark, expanding its European footprint to six markets.
WeRide's L4 fleet grew 22% from April to about 3,400 vehicles. Its Robotaxi fleet increased by 500 vehicles, or 40%, to more than 1,800. Management believes its overseas regulatory approvals, supported by technology localization, ecosystem integration, and safety validation, could provide a two- to three-year competitive advantage.
China Rides Are Picking Up Speed
Back in China, the numbers are also looking up. Average daily Robotaxi rides per vehicle rose 24% sequentially to 21, with peak daily rides hitting 28. Registered users in China increased nearly 35% sequentially, and ride-hailing revenue surged 140% from the previous quarter.
WeRide's L2/L3 business is also entering mass production. Revenue from its one-stage end-to-end solution increased nearly 26-fold from a year earlier. The company delivered about 30,000 L2-equipped vehicles during the second quarter, and it expects more than 100,000 vehicles to use its technology by year-end. It projects cumulative deliveries to exceed 500,000 next year.
WeRide also launched an L3 autonomous-driving proof of concept with Mercedes-Benz, adding another major automaker validation for its technology.
WeRide CEO Wants a Showdown With Tesla FSD
During the earnings call, WeRide CEO Tony Han made some bold comments about Tesla Inc. (NASDAQ: TSLA). He said the company hopes Tesla brings its Full Self-Driving technology to China in the fourth quarter, adding that WeRide wants a direct head-to-head comparison with FSD.
Han, who says he's a heavy FSD user in California, said he has also driven vehicles equipped with WeRide's WRD 3.0 ADAS system. "I think these two things are comparable," he said.
It's a confident stance, and it sets up an interesting narrative for the autonomous driving space. Whether WeRide can actually back it up remains to be seen, but the company is clearly positioning itself as a serious player on the global stage.
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