Half-Year Net Profit Down 60% Yet Buyback Proceeds, Where Does Wei Jianjun's 'Long-Termism' Confidence Lie?

On July 14, Great Wall Motor's semi-annual performance forecast announcement sparked widespread market attention. The announcement indicated that the company expects net profit attributable to parent company shareholders for the first half of 2026 to be between 2.35 billion and 2.6 billion yuan, a year-on-year decline of 58.97% to 62.92%. The net profit excluding non-recurring gains and losses attributable to parent company shareholders for the same period is expected to be between 1.5 billion and 1.75 billion yuan, a year-on-year decrease of 51.14% to 58.12%.

Looking at the profit figures alone, it is indeed staggering — from 6.337 billion yuan year-on-year to less than 2.6 billion yuan suddenly. However, if we look away from the income statement to examine the full picture of the entire performance report, we will find another completely different story: Cumulative sales volume in the first half of the year reached 583,900 units, a year-on-year increase of 2.48%; operating revenue increased year-on-year; overseas sales reached 291,400 units, a year-on-year surge of 47.44%; high-value vehicle models above 200,000 yuan sold 270,200 units, an increase of 55,700 units year-on-year, with a sales volume share of 44%, a year-on-year increase of 7 percentage points.

Sales volume and revenue both increased, yet profits nearly halved. Behind this seemingly contradictory phenomenon lies a profound structural transformation that Great Wall Motor is currently undergoing.

I. The "Real Reason" for the Sharp Drop in Profits: One-off Rather Than Trend-Based

Great Wall Motor Chairman Wei Jianjun openly responded to the public via Weibo on the same day the performance forecast was released. The reasons for the profit decline are clear and transparent: first, the recovery of overseas tax policy subsidy income was delayed — the company received 2.274 billion yuan in tax subsidies last year at this time, but this income has not yet arrived this year; second, the impact of exchange rate fluctuations — after hedging foreign exchange lock-in value protection products, the comprehensive exchange loss for this period was approximately 266 million yuan, with a year-on-year decrease in exchange gains of approximately 1.759 billion yuan (1.493 billion yuan in gains for the same period last year).

The changes in non-recurring gains and losses totaling nearly 4 billion yuan explain the year-on-year decrease in net profit attributable to the parent company of 3.737 billion to 3.987 billion yuan. In other words, Great Wall Motor's core operating capability in the first half of the year did not deteriorate in a trend. The data itself of 1.5 billion to 1.75 billion yuan for net profit excluding non-recurring gains and losses, conversely, reflects the actual profitability of the company's main business more accurately.

This is not the first time Great Wall Motor has encountered short-term profit fluctuations. In the first half of 2025, the company also saw a situation of "revenue grew but profits didn't" — revenue increased slightly by 0.99% to 92.335 billion yuan, and net profit attributable to parent company shareholders of 6.337 billion yuan decreased by 10.21% year-on-year. At that time, the profit decline was attributed to channel model transformation and increased investment in new vehicle models. By the second quarter of 2025, net profit attributable to parent company shareholders increased significantly by 161.91% quarter-on-quarter to 4.586 billion yuan.

Historical experience shows that Great Wall Motor's profit fluctuations often have obvious phased characteristics.

II. Overseas Growth of 47%: From 'Going Global' to 'Going Upward'

What is truly worthy of attention is the data that Great Wall Motor's overseas sales in the first half of the year reached 291,400 units, a year-on-year increase of 47.44%. Looking at the entire Chinese automotive industry, passenger car exports in the first half of 2026 reached 4.432 million units, a year-on-year increase of 71.7%; total car exports reached 5.096 million units, a year-on-year increase of 65.3%. China's automotive industry going global is at a historic window of opportunity, and Great Wall Motor has occupied an important position in this tide.

More importantly, the quality of growth. At the beginning of 2026, Great Wall Motor set a goal of 600,000 units in annual overseas sales, while the company CTO Wu Huixiao stated during the Beijing Auto Show that overseas order growth exceeded expectations, "The goal might be adjusted upward, even higher than last year's 30% growth rate". Great Wall Motor's logic of going global is not simply "trading volume for price" — its overseas sales are mainly fuel vehicles (accounting for 94% from January to April 2026), with 3 full-process complete vehicle production bases built in places like Brazil and Thailand, overseas sales channels exceeding 1,500, and cumulative global users exceeding 16 million.

This "ecosystem going global" approach is completely different from simply moving domestic products to overseas markets. Great Wall Motor CTO Wu Huixiao once stated bluntly that globalization cannot be simply understood as moving products verified in the Chinese market to overseas. This persistence in long-termism means that profit release in overseas business will not be achieved overnight, but the deeper the foundation is laid, the broader the future growth space will be.

III. Share of High-Value Models at 44%: A Signal of Brand Upward Trend

Another key indicator easily overlooked is: Cumulative sales of vehicle models above 200,000 yuan in the first half of the year reached 270,200 units, with a sales volume share of 44%, an increase of 7 percentage points year-on-year. Against the background of overall pressure in the current domestic passenger car market — domestic passenger car sales in the first half of the year were 8.288 million units, a year-on-year decrease of 24.3% — this achievement is particularly rare.

The increase in the share of high-value models means that Great Wall Motor is breaking free from the path dependency of winning on price-performance ratio in the past, seeking profits through brand premium. Continuous efforts in mid-to-high-end product lines such as Tank brand and Wey brand are reshaping the company's product structure and profit model. A brokerage research report pointed out that 2026 is the "peak year for mid-to-high-end products" for Great Wall Motor. The launch of all-new Tank 700, Tank 300 and other models will further promote the upward improvement of global brand influence.

At the channel operation level, Great Wall Motor also showed restraint and rationality. Wei Jianjun specifically mentioned in the response: "At the channel operation level, we sell more and ship less. The domestic inventory-to-sales ratio is better than the industry average, ensuring healthy operation of enterprises and dealers." In the 2026 auto market where price wars rise and fall, being able to maintain channel health rather than blindly forcing inventory buildup is itself a kind of strategic determination.

IV. Buyback and Confidence: A Footnote of Long-Termism

While releasing the performance forecast, Great Wall Motor announced that it will proceed with share buyback according to the H-share buyback plan. This move sent a clear signal: The management believes the current stock price fails to reflect the company's true value.

Credit Suisse downgraded Great Wall Motor's target price after the performance forecast but maintained the "Outperform the market" rating, citing the reason that "Great Wall is expected to maintain resilience amidst industry volatility". The underlying logic of this "resilience" is exactly the three keywords that Great Wall Motor has continuously emphasized over the past few years: bottom-line thinking, long-termism, and pursuing quality market share -.

Wei Jianjun has a pragmatic interpretation of long-termism: "Long-termism is not about looking at the short-term effectiveness of specific moves, but about creating high-quality, high-technology products to provide users with a durable and worry-free driving experience." Short-term fluctuations in net profit are just a data point in the framework of long-termism.

V. Conclusion: Beyond the Numbers

Returning to the question at the beginning of the article: Why did the profit of a company with dual growth in sales volume and revenue drop sharply by 60%?

The answer is already clear: Almost all of the nearly 4 billion yuan profit gap comes from tax subsidy delays and exchange rate fluctuations, these two non-recurring factors. Excluding these factors, Great Wall Motor's core operating fundamentals did not deteriorate, but actually made substantial progress in multiple dimensions such as overseas expansion, brand upward trend, and channel health.

Of course, this does not mean Great Wall Motor can sleep soundly. Fierce competition in the domestic market, continuous pressure from new energy vehicle transformation, and geopolitical risks in overseas markets are all realistic challenges placed before them. At least, what this semi-annual report reveals is not a signal of an enterprise heading towards decline, but the growing pains of a traditional automaker actively undergoing structural adjustment amid major industry changes.

As Wei Jianjun said: "Surface numbers are important, but we care more about the healthy development of the enterprise." In the automobile industry filled with short-term gaming and price wars, an enterprise philosophy that adheres to "not sacrificing long-term health for short-term profits" is itself a scarce competitiveness.

Numbers will fluctuate, but direction is more important than speed. Great Wall Motor is proving with actions: It has chosen a harder but more sustainable path.