The company posted a net loss of $712.4 million for Q1 2025, a notable improvement from the $1.3 billion loss in the previous quarter but still 20% deeper than the year-earlier period. The figure missed analysts’ average forecast of $616.3 million, according to LSEG data.
Revenue, however, showed significant growth, rising 150% year-over-year to $656.5 million, beating expectations of $520 million. The spike was driven by a near 300% surge in vehicle deliveries, which reached 36,330 units, largely concentrated in Vietnam, the company’s home and largest market.
The market responded positively to the sales momentum, with VinFast shares jumping over 10% in pre-market trading.
Financial Strain Amid Growth
Despite the revenue leap, VinFast remains unprofitable. Its gross margin stood at negative 35.2%, improved from negative 58.7% a year ago, but still far from breakeven. The company continues to lose money on each vehicle sold, with analysts at Third Bridge attributing this to high production costs and lack of scale:
“The bill of materials is estimated to be significantly higher than those of Tesla and BYD,” Third Bridge noted, citing the brand’s limited track record and smaller volumes as reasons suppliers charge premium rates.
The company's research and development spending dropped 22.3% year-on-year, even as cost of sales more than doubled, underscoring the challenge of balancing innovation with rising production demands.
U.S. Tariffs and Strategic Shifts
VinFast has faced strong headwinds in the U.S., where it had once pinned its hopes for growth. But the 25% tariff on imported EVs imposed by Washington has made market penetration significantly tougher. Combined with soft global EV demand and intense competition, the firm is now recalibrating its international strategy.
“We’re shifting our focus to Asia,” said Chairwoman Thuy Le during an earnings call, pointing to a new assembly plant in India, set to begin operations in July.
The company is also pivoting away from its previous strategy of owning branded showrooms, now adopting a dealership model to lower overheads and increase sales reach.
Diversifying with Electric Buses and Entry Models
In the domestic market, VinFast’s VF 3 and VF 5 mini EVs continue to gain traction, accounting for 68% of total local deliveries. The company is also doubling down on the electric bus segment, a promising space in which it already has strong sales in Vietnam.
“We are exploring opportunities in Asia and Europe with plans to offer electric buses in 6, 8, 10, and 12-meter sizes,” said Le, adding that operations have already launched in Indonesia and Europe, with the Middle East and U.S. next in line.
Looking ahead, VinFast will introduce its next-generation vehicle platform and electrical architecture with the upcoming Limo Green model in Q3. This technology will underpin the brand’s EV lineup from next year.
Heavy Backing from Vingroup
VinFast continues to be heavily backed by its parent conglomerate Vingroup and its founder Pham Nhat Vuong, who have provided around $2 billion in funding as of May. The support has kept the company afloat amid persistent losses and ambitious expansion plans.
Since going public in August 2023, VinFast has yet to turn a profit. But its current strategy — shifting geographic focus, cutting costs, and pushing volume through lower-cost models — reflects a long-term bet on scale and positioning in emerging EV markets.
The question remains whether the company can close the gap between rapid growth and financial sustainability — a challenge made more urgent by rising competition and investor scrutiny in a rapidly maturing EV industry.