Shares of WeRide (WRD) shot up 21% yesterday after reporting solid first-quarter results that helped the Chinese robotaxi stock avoid the bloodbath occurring across the rest of the market.
As stocks tanked on a poor Treasury bond sale, WRD stock was running higher as robotaxi sales nearly doubled. Management was so confident in its future financial position it even announced a stock buyback program.
Although revenue only grew 1.8% in the quarter to $10 million, robotaxi sales contributed 22.3% of the total, 10 percentage points more than the year-ago figure. Gross profit margins also stabilized in the period at 35%, about the same as it saw in Q4.
While WeRide is still reporting substantial adjusted net losses, or $40.6 million, about twice as great as last year, it is not surprising given the robotaxi company's early phase of growth. Per share losses, however, narrowed considerably from $1.64 to $0.18. But WRD saw more robotaxi and robosweeper sales, offset somewhat by a decline in robobus sales.
The increased sales, though, allowed WeRide to announce a $100 million buyback program, CFO Jennifer Li said, "The adoption of the share repurchase program reflects our confidence in our business fundamentals, financial health, and long-term outlook, and underscores our commitment to delivering value to shareholders."
WeRide went public via an IPO last October, but only really gained noticed after it was revealed Nvidia (NVDA) had taken a stake in WRD stock. Yet other industry heavyweights are also interested in its autonomous vehicle technology, including Uber Technologies (UBER), which invested $100 million in the robotaxi stock. Nvidia's invested $24 million in WRD.
While WeRide robotaxis are spreading across Asia and Europe, the autonomous vehicle stock faces tough competition from Pony.ai (PONY), Google's Waymo, and Tesla (TSLA), which will begin testing its robotaxis in Austin in June.
Despite this, WRD stock increasingly looks like a viable growth opportunity, appropriate for volatility and risk-tolerant investors.
