China Automotive Systems, Inc. (NASDAQ:CAAS), a top supplier of power steering components in China, reported second-quarter earnings that exceeded analyst expectations, with net income rising 6.8% as the firm continues its shift toward advanced steering technologies.
The company posted earnings per share of $0.25 for Q2, with revenue climbing 11.1% year-on-year to $176.2 million. Sales of Electric Power Steering (EPS) products surged 31.1% YoY, now making up 41.4% of total product sales, up from 35.1% in the same period last year.
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 markets have become a major growth driver, with Brazilian sales jumping 49.4% YoY to $17.9 million and North American sales rising 11.8% to $30.0 million.
Gross profit increased 4.2% to $30.5 million, though gross margin fell to 17.3% from 18.5% a year earlier, mainly due to higher tariffs and shifts in product mix. Operating income rose 20.2% to $13.0 million compared with the same quarter last year, reflecting stronger sales volume.
Looking ahead, China Automotive Systems raised its full-year 2025 revenue guidance to $720 million. The company holds a solid financial position, with $135.3 million in cash, cash equivalents, and short-term investments as of June 30, 2025, roughly $4.48 per share.
China Automotive Systems stock price
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