Microvast reported a sharp deterioration in third-quarter results as weaker demand across Europe and Asia-Pacific and industry pricing pressure cut sales and margins. The battery maker said the quarter’s performance significantly constrained its liquidity, and it is focused on reducing costs, preserving cash and negotiating with lenders over near-term debt.
It also said installation and commissioning of production equipment at its Huzhou, China, site is complete, while a battery-pack assembly line at its Clarksville, Tennessee, facility is substantially complete.
Key details
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Revenue fell 62.8% to $45.8 million, from $123.3 million a year earlier. Sales volume declined 62.2%, to about 189.6 megawatt-hours from 501.7 megawatt-hours.
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Weaker demand reduced orders from established customers in Europe and Asia-Pacific. Microvast cited softness in heavy-duty trucks, port equipment and mining equipment, along with regulatory and geopolitical dynamics in markets including India and South Korea. In India, it also pointed to demand shifting toward lower-cost products.
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U.S. sales were also lower year over year. Microvast attributed the decline mainly to its largest customer bringing purchases forward into 2025 amid uncertainty over tariffs.
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Gross margin dropped to 5.2% from 37.6%. A $9.3 million, non-cash write-down of obsolete inventory—primarily specialized energy-storage components—reduced gross margin by 20.4 percentage points. Beyond that charge, lower sales volume and industry pricing pressure weighed on margins, while reduced production meant fixed manufacturing and operating costs were spread across less revenue.
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Operating expenses rose to $69.0 million from $31.6 million. The increase was primarily driven by $35.7 million in non-cash impairments of long-lived assets: $15.0 million for China operations, $4.4 million for Germany and $16.3 million for the U.S. The charges followed impairment reviews prompted by the quarter’s decline in sales, margins and operating performance.
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Net loss widened to $76.8 million from $1.5 million a year earlier. Microvast attributed the larger loss mainly to the asset impairments and lower gross profit as revenue fell. It also reported a non-GAAP adjusted net loss of $76.0 million.
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The company is seeking changes to near-term debt obligations. Microvast said it is negotiating with lenders in an effort to refinance, extend or restructure that debt. It cautioned that the outcome is uncertain and depends in part on lender decisions and customer demand.
The results show pressure on both Microvast’s operating performance and liquidity. The inventory write-down and asset impairments were non-cash charges, but the company said the broader decline in sales, gross margin and operating performance has significantly constrained its balance sheet.