BYD's Overseas Engine Now Powers Half the Business — But the Share Price Refuses to Join the Party
Published on 09/07/2026 at 00:00 | Editorial boerse-global.de
The arithmetic at BYD has taken on a striking new shape. For the first time, the Chinese automaker is earning more revenue beyond its borders than at home — a milestone that has arrived just as Beijing tightens its grip on how carmakers expand abroad and Washington adds the company to a military-linked blacklist.
The numbers from the first half of 2026 tell the story of a business in transition. Revenue slipped 7.1 percent year-on-year to 344.82 billion yuan, while net profit attributable to shareholders fell 20.5 percent to 12.33 billion yuan. Yet buried inside those declines is a remarkable shift: overseas revenue jumped 33.9 percent to 181.27 billion yuan, now representing 52.6 percent of total sales. Exports climbed 67.8 percent to 792,000 vehicles, roughly 44 percent of the 1.81 million electric and hybrid units BYD delivered globally in the period.
The margin picture offers some comfort even as profits shrink. Gross margin expanded to 18.85 percent from 18.01 percent a year earlier, and operating cash flow improved to 37.34 billion yuan from 31.83 billion. That suggests the underlying business is getting healthier even while the headline earnings number disappoints.
A Second-Quarter Turnaround Takes Shape
The interim results, published on August 28 and reported by China Daily, were followed by monthly sales figures that point to a stabilizing earnings trajectory. August deliveries reached 440,293 vehicles, up 17.8 percent year-on-year — the fourth consecutive month of growth. Overseas shipments in the month surged 134.5 percent to 189,466 units, cementing international demand as the primary growth driver while the Chinese market remains subdued.
That momentum translated into the first quarterly profit increase in over a year. Second-quarter net income rose 30 percent to 8.2 billion yuan, even as revenue dipped roughly 3 percent to 194.6 billion yuan. The sequential improvement suggests the weak first quarter may have marked the trough.
The export story extends beyond a single month. BYD has now sold 1.158 million vehicles overseas through August of this year, surpassing the 1.0496 million units it exported in all of 2025. August marked the fifth consecutive record month for overseas sales, according to Chinese media reports. The company's research and development spending of 28.861 billion yuan in the first half also dwarfs rivals such as SAIC.
Geopolitical Headwinds Gather
The rapid international expansion has not gone unnoticed in Washington or Beijing. The United States recently placed BYD on a list of companies alleged to have ties to China's military, alongside Alibaba, Baidu, WuXi AppTec, RoboSense and Unitree. The reaction in Hong Kong was surprisingly muted — BYD shares actually rose 1.5 percent, while other listed companies on the list, such as WuXi AppTec, came under considerably more pressure.
Meanwhile, Chinese regulators have issued new guidelines governing automakers' overseas operations, introducing stricter requirements on foreign investment and toughening compliance rules around antitrust, anti-corruption and social responsibility. Reuters characterized the move explicitly as a response to the wave of global expansion led by BYD.
The political crosscurrents have produced some unlikely endorsements. US Treasury Secretary Scott Bessent publicly praised BYD at the Economic Club in Charlotte, describing the company as delivering vehicles worth $70,000 in quality for $35,000.
Regional Markets Tell a Mixed Story
The global picture is far from uniform. In Australia, BYD described August as a "turning point" for electric vehicles, with battery-electric new car sales of 27,078 units surpassing both petrol and diesel vehicles for the first time. BYD sold 8,231 vehicles there, up 68 percent, though Tesla's 7,685 units grew at a faster 160 percent clip.
South Korea offered another bright spot, where labor strikes at domestic manufacturers created an opening. While Hyundai and Kia lost combined domestic sales of nearly 74,500 units in August, BYD sold 3,002 vehicles there and, together with Tesla, accounted for 45 percent of all imports.
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Elsewhere, the picture is more complicated. In Pakistan, BYD's $150 million plant in Gharo has fallen behind schedule, with production now not expected to start until the second half of 2026. Indonesia has required BYD to halt imports of completely built units after the two-year quota of 100,000 vehicles was nearly exhausted at 92,000 — local production in Subang is meant to fill the gap.
The Market Remains Unconvinced
For all the operational progress, the share price tells a different story. The stock closed Friday at €9.45, roughly 24 percent below its 52-week high of €12.49 from October. It also trades beneath its 200-day moving average of €10.41, signaling a weak medium-term trend. On the year, the shares are down about 12 percent.
The disconnect between robust export figures and a sagging share price leaves investors with an uncomfortable choice: back the operational turnaround story, or respect the geopolitical and regulatory risks that could slow the very expansion driving those numbers. The concrete impact of the US sanctions list on BYD's business has yet to be quantified, and Beijing's new rules could temper the pace of overseas investment. For now, the market seems to be pricing in the risks rather than the growth.
