SHENZHEN-LISTED battery maker Contemporary Amperex Technology Co.’s quarterly profit soared, powered by rising electric vehicle (EV) sales globally and stabilizing prices of key materials like lithium.

Net income of the firm, widely known as CATL, rose 63% to 10.9 billion yuan (US$1.5 billion) in the three months through June, based on a calculation of the company’s first-half results. Revenue increased 56% to 100 billion yuan. Both figures beat analyst estimates.

Record quarterly sales for top customer Tesla Inc., which accounts for 12% of CATL’s revenue, helped propel the Fujian-based firm’s profit growth.

CATL, which also counts Ford Motor Co., Volkswagen AG, Hyundai Motor Co. and Nio Inc. among its customers, has tightened its grip on the global EV battery market as it ramps up output. Its share in the first five months of 2023 was 36.3%, up 1.7 percentage point from the same period last year, according to SNE Research.

BYD Co. had a 16.1% share, producing batteries used in its expanding lineup of clean cars.

The Chinese price of lithium carbonate, which is the refined form of the metal used in EV batteries, has halved from last year, easing CATL’s cost pressures.

The company said its first-half net income was 20.7 billion yuan on revenue of 189 billion yuan. Gross margins also continued to grow, reaching 21.6% for the period, up almost three percentage points from the same period a year earlier.

CATL’s core power battery business, which makes cells for EVs, generated 139 billion yuan in sales to deliver 74% of first-half revenue.

The contribution was 4 percentage points higher compared with a year earlier. The fast-growing energy storage business contributed 28 billion yuan to the top line. (SD-Agencies)