XPeng’s GX SUV Rescues a Sinking Quarter, but AI Ambitions Burn Cash at Record Pace

The surge in orders for XPeng’s new GX SUV has provided a much-needed lifeline after a dismal first quarter, yet the company’s aggressive push into robotics and artificial intelligence is draining cash at an accelerating rate. The Chinese EV maker is betting that its “Physical AI” vision—spanning humanoid robots, robotaxis, and flying cars—can transform its identity, but the financial strain is becoming impossible to ignore.

Within 12 hours of the GX’s launch on May 20, XPeng had logged 24,863 firm orders, and analysts expect the month’s total to reach roughly 50,000—around 40% more than April’s tally. An unusually high 80% of early buyers opted for the pricier “Ultra” trim, pushing waiting times for the top electric variant beyond 30 weeks. The six-seater starts at 269,800 yuan, an aggressive price point designed to carve out space in the luxury segment. Meanwhile, the company’s V?2.0 international strategy is expanding into France, Australia, and the United Arab Emirates.

That demand stands in stark contrast to the first quarter, when revenue tumbled 17.6% year-on-year to 13.03?billion yuan and deliveries slumped a third to 62,682 units. Net loss widened to 1.78?billion yuan from 660 million a year earlier. Yet there was a bright spot: gross margin climbed to 20.6% from 15.6%, and vehicle margin reached 12.1%, reflecting cost reductions and a richer product mix. The company still holds 42.09?billion yuan in cash, deposits, and investments.

Should investors sell immediately? Or is it worth buying XPeng?

XPeng is channeling those resources into an ambitious “Physical AI” strategy that extends far beyond cars. It has set aside 7?billion yuan for AI research and development in 2026 alone, with quarterly cash burn now exceeding 5?billion yuan. The humanoid robot “IRON” is slated for series production by the end of this year, and from the first quarter of 2027 will begin working as sales assistants in XPeng’s own retail stores. A robotaxi pilot is also planned for Guangzhou in the third quarter of 2026.

For the second quarter, XPeng expects deliveries to surge to between 100,000 and 106,000—a sequential jump of up to 69%—with revenue projected at 19.6?billion to 20.8?billion yuan. Analyst opinions are divided. Jefferies maintains a buy rating but trimmed its target to $25.20, warning of swelling R&D expenses. Macquarie upgraded to outperform, and BofA Securities raised its target to $25, both citing the GX order momentum as a key driver.

The stock is trading at around 14.10 euros, roughly 42% off its 52-week high from November 2025 but up about 10% from the mid-May trough. The relative strength index of 79.2 signals short-term overbought conditions, and the shares sit just 9% above their 52-week low. On a one-year view, the stock is still down roughly 20%. Whether the GX’s runaway start can offset the escalating cost of XPeng’s robot ambitions will be the central question when second-quarter results are published—a report that could prove decisive for the company’s new strategic direction.

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