Seres, an automotive stock that was once highly acclaimed, is now grappling with challenges. On July 13, its A-share price plummeted to the limit down, marking a year-to-date decline of over 50%. Meanwhile, its Hong Kong-listed stock also closed down by 13.68%. The anticipated loss in the interim report served as the direct catalyst for the stock price decline, yet signs of a downward trend had surfaced earlier. In the first half of 2025, Seres witnessed a significant year-on-year surge in net profit attributable to shareholders, primarily driven by the exceptional performance of the AITO M9 and M8 models in the high-end market. However, in the first quarter of this year, despite continued revenue growth, profit growth decelerated markedly, with both non-recurring net profit and gross profit margin experiencing declines. This was mainly attributable to a decrease in sales of older models such as the M9, while the M7 saw some growth. Nevertheless, new models had not yet achieved stable deliveries, exacerbating profit pressure. After April, the launch of the new-generation M9 and M6 models yielded impressive delivery figures, with cumulative deliveries in the first half of the year increasing year-on-year. Nonetheless, the pressure during the product transition period has not been fully alleviated, as sales in June declined year-on-year. This prompted several brokerage firms to downgrade their revenue and net profit forecasts for Seres. In the second quarter, escalating prices of storage chips and lithium carbonate drove up the manufacturing cost per vehicle. Concurrently, adjustments to the book value of existing assets resulted in a loss exceeding RMB 2.2 billion for the quarter, with an anticipated loss ranging from RMB 1.5 billion to RMB 1.8 billion for the first half of the year. Seres stated that the company boasts sufficient cash reserves and that orders and deliveries for new models are on the rise. However, the market remains concerned that the product transition will prolong the time required for profit recovery, while cost and asset adjustments will further amplify profit pressure. Close attention should be paid to its interim and third-quarter financial reports in the future.