XPeng (NYSE: XPEV) stock fell 7% to $11.40 on Monday as a Q2 2026 revenue miss and a soft third-quarter outlook overshadowed a landmark fundraising milestone for its humanoid robotics division.

The company reported Q2 2026 revenue of RMB19.74 billion, equivalent to approximately $2.91 billion, representing 8% growth year over year and 51.5% growth quarter over quarter, but falling short of Wall Street expectations.

Deliveries for the quarter totaled 103,295 units, up just 0.1% year over year, while gross margin expanded to 20.7% from 17.3% in the same period a year earlier.

Vehicle margin, however, narrowed to 12.1% from 14.3% as the company absorbed costs tied to a product-generation transition, adding pressure to an already disappointing result.

The Q3 guidance landed well below consensus, with XPeng projecting revenue of RMB21.7 billion to RMB23.4 billion against Wall Street’s expectation of RMB25.88 billion per Fiscal.ai via Stocktwits.

Third-quarter deliveries are guided at 115,000 to 121,000 units, compared to 116,007 units delivered in the same quarter a year earlier, offering little comfort to investors hoping for accelerating volume growth.

Research and development expenses climbed 32% to RMB2.91 billion, even as the company’s cash position held at RMB40.48 billion as of June 30, providing some balance sheet reassurance.

XPeng’s robotics arm, IRON, raised over $900 million in its latest funding round at a post-money valuation above $6.3 billion, marking the largest single-round private financing in China’s embodied AI industry.

IDG Capital led the round, with Gaorong Ventures participating alongside strategic investors Tencent and Alibaba (NYSE: BABA), signaling deepening alignment among Chinese technology giants behind the physical AI sector.

The IRON humanoid robot carries 76 degrees of freedom across the body and 21 in each hand, runs on three Turing AI chips delivering up to 2,250 TOPS, and is targeted for mass production by the end of 2026.

Initial commercial deployments are planned inside XPeng stores and campuses, with large-scale customer deliveries in China and overseas expected to begin in 2027.

XPeng Chairman and CEO He Xiaopeng stated, “I believe XPENG will not only build one of China’s most valuable humanoid robotics companies, but also become a global leader in physical AI.”

Despite the bold vision, the market responded to Monday’s session as an automotive margin story rather than a robotics opportunity, with investors focusing on the near-term earnings shortfall.

The broader electric vehicle complex split along regional lines, with NIO (NYSE: NIO) falling 4% to $4.45 in sympathy, while Tesla (NASDAQ: TSLA) slipped a more modest 2% to $354.06.

Lucid (NASDAQ: LCID) shares edged down 1% to $5.46, while Rivian (NASDAQ: RIVN) bucked the trend entirely, rising 0.7% to $17.09 on the same session.

XPeng’s earnings-day reaction history underscores the risk, with the stock posting a 10.3% day-of drop on Q3 2025 results and an 8.4% decline on Q4 2025 results even during a streak of five consecutive quarterly beats through Q1 2026.

Investors will be watching whether delivery momentum accelerates into the G9L flagship launch and the Q4 Mona L05 rollout in China, and whether international shipments above 20,000 units in Q2 can offset the softer domestic guidance.