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Investing.com - China Automotive Systems, Inc. (NASDAQ:CAAS), a leading power steering components supplier in China, reported second quarter earnings that beat expectations, with net income rising 6.8% as the company continues its transition to advanced steering technologies.
The company posted earnings per share of $0.25 for the second quarter, as revenue increased 11.1% YoY to $176.2 million. Sales of Electric Power Steering (EPS) products grew 31.1% YoY and now represent 41.4% of total product sales, up from 35.1% in the same period last year.
The company’s shares dipped 1% following the announcement.
"We continued to grow our sales, gross profit, net profit and cashflow in the second quarter of 2025," said Qizhou Wu, Chief Executive Officer of CAAS.
"Sales of our traditional steering products remained steady while sales of our Electric Power Steering products grew by 31.1% year over year."
International expansion has become a key growth driver for the company, with sales in Brazil surging 49.4% YoY to $17.9 million, while North American sales increased 11.8% to $30.0 million.
Gross profit increased 4.2% to $30.5 million, though gross margin decreased to 17.3% from 18.5% a year earlier, primarily due to increased tariffs and changes in product mix.
Income from operations rose 20.2% to $13.0 million compared to the same quarter last year, reflecting the company’s higher sales volume.
Looking ahead, China Automotive Systems raised its full-year 2025 revenue guidance to $720 million.
The company maintains a strong financial position with $135.3 million in cash, cash equivalents and short-term investments as of June 30, 2025, equivalent to approximately $4.48 per share.
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