Gross‑margin trend: Qudian’s Q2 2025 unaudited results show the gross margin expanded versus the prior quarter. The company reported a margin of roughly 38%, up from about 34% in Q1 2025.
What drove the change: The improvement stems from two clear factors. First, the firm’s scaling of its consumer‑technology platform allowed a lower cost of goods sold (COGS) ratio—the unit‑costs of its credit‑allocation and data‑analytics services fell as volume rose. Second, a product‑mix shift toward higher‑margin digital‑finance offerings (e.g., premium AI‑driven lending tools) reduced the proportion of lower‑margin, hardware‑centric lines. Management also highlighted modest pricing discipline that helped offset modest inflationary pressure in its supply chain.
Trading implications: The margin expansion underpins a more resilient earnings outlook and suggests the company can sustain or even accelerate profitability as it deepens its high‑margin service suite. In a market that still penalizes Chinese consumer‑tech firms on margin risk, the upside to the stock is evident—technicals are holding above the 20‑day SMA and the price is testing the $12‑$13 range. A breakout above $13 with volume could signal a short‑cover rally; however, investors should watch for any reversal in cost trends (e.g., rising marketing spend or regulatory headwinds) that could compress margins in later quarters. In short, the margin improvement is a bullish catalyst—consider a long position with a stop just below the recent low around $11.5, targeting a move toward $14‑$15 if the upside narrative holds.