ECARX (NASDAQ:ECX) reported a second-quarter rebound in revenue and shipments as new vehicle launches accelerated and higher-end computing platforms accounted for a larger share of its business. The company reaffirmed its full-year 2026 revenue outlook of $1 billion to $1.1 billion while discussing planned investments in software, LiDAR and international expansion.
Chief Executive Officer Ziyu Shen said revenue rose 45% year over year and 71% sequentially during the quarter. Gross margin expanded to 19.8% from 10.8% a year earlier, while operating expenses declined year over year despite higher revenue. The company also recorded its fourth consecutive quarter of positive adjusted EBITDA.
Higher-End Product Mix Drives Revenue Growth
Chief Operating Officer Peter Cirino said ECARX shipped approximately 550,000 units in the second quarter, up 51% from the first quarter but down 2% from the prior-year period. Despite the year-over-year decline in unit shipments, revenue increased as sales shifted toward higher-value products and pricing reflected higher memory costs.
Shipments of the company’s Antora high-end solutions rose 92% sequentially and 52% year over year, while shipments of its Pikes AI-driven computing platform increased 43% from the prior quarter and more than 2,000% from a year earlier. Antora and Pikes together represented 42% of shipments in the quarter, Cirino said.
The executive attributed the mix shift to ECARX’s decision last year to phase out lower-margin legacy platform business and focus on higher-end solutions designed by the company. During the quarter, ECARX began mass production for nine new vehicle models across four brands, with most using Pikes or Antora platforms. Four of those models are intended for markets outside China, including Europe, Southeast Asia and South America.
ECARX said it now has technology installed in 12 million vehicles on the road.
Revenue Components and Margin Considerations
Chief Financial Officer Dylan Jeng said sales of goods revenue totaled $196 million, up 73% sequentially and 50% year over year. Software revenue was $0.7 million, down 42% year over year because of lower sales volume, while service revenue rose 21% to $28 million, supported by new model launches.
Jeng said gross profit totaled $44.5 million. He attributed the improved gross margin in part to a greater contribution from higher-value platforms, cost management and timing differences between the company’s component purchases and pricing passed through to customers.
However, management said memory-cost dynamics could weigh on gross margin and operating profitability in coming quarters. Higher memory prices raise reported revenue when costs are passed through to customers, but can result in lower margins, Jeng said.
During the question-and-answer session, management said its supply-chain team was working closely with suppliers and the market to manage memory availability and costs. A company representative said ECARX had built strategic relationships with NXP and Samsung and maintained inventory and a future supply pipeline, adding that management expected most cost increases to be passed on to customers.
Adjusted EBITDA was positive $0.5 million in the second quarter, compared with positive $4 million in the first quarter. Jeng said first-quarter adjusted EBITDA included a $14 million partial monetization of ECARX’s shareholdings in SiEngine, a one-time item that did not recur in the second quarter. Adjusted EBITDA improved by $30.2 million from the prior-year period, he said.
Flyme Deal and New LiDAR Partnership
ECARX also outlined plans to broaden its technology portfolio. In June, the company signed a definitive agreement to acquire the entire Flyme software business for approximately $266 million. Shen said Flyme Auto is deployed in more than 2 million vehicles, while Flyme OS is a component of ECARX’s Cloudpeak middleware.
Cirino said ECARX plans to operate Flyme as an independent software division, preserving research and development continuity for existing customers. The acquisition is intended to give ECARX greater control over its software roadmap, add licensing and custom-development revenue streams, and support integration across vehicles, smartphones and wearable devices.
Separately, ECARX entered a strategic partnership with TPK Holding to co-develop the ORCA LiDAR platform. ECARX will lead system integration, sensor fusion and global commercialization, while TPK will contribute optical design, engineering and high-volume manufacturing. Mass production is scheduled to begin in 2028 at TPK’s Thailand facility.
Global Expansion and Outlook
The company said its partnership with Volkswagen Group continued to advance, with ECARX building engineering, supply-chain and support infrastructure in Latin America ahead of an expected 2027 launch. The program is expected to integrate Antora computing platforms, Cloudpeak middleware and Google built-in for Volkswagen vehicles across premium and entry-level segments.
Looking ahead, Jeng said management’s confidence in the second half rests on a heavier launch cadence, order backlog and the company’s historical tendency for the second half to generate a larger share of annual revenue. ECARX reiterated its 2026 revenue guidance of $1 billion to $1.1 billion.
About ECARX (NASDAQ:ECX)
ECARX is a global automotive technology company focused on developing and delivering smart cockpit solutions for original equipment manufacturers (OEMs). The company designs and manufactures a range of in-vehicle computing platforms, central processing units, digital instrument clusters and multimedia infotainment systems. ECARX’s core offerings integrate software, hardware and cloud connectivity to create seamless user experiences for drivers and passengers.
The company’s product portfolio spans telematics control units, over-the-air update frameworks and next-generation human-machine interfaces (HMI).
