GGR’s First Three Quarters: Battery-Swapping Growth and the Other Side of Cash Flow

Originally published 2023-11-17Robin’s financial-statement analysis

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English translation of the Chinese post originally published 2023-11-17. Translated 2026-10-27 with AI assistance. Historical figures and claims have not been updated or independently verified. 中文原文

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Robin reviews GGR’s first three quarters of 2023. Revenue fell 10% amid currency effects and price cuts by gasoline-scooter rivals, but battery-swapping revenue grew 10%, or 14% excluding currency effects, and should rise with the installed base in Taiwan. Losses narrowed to US$3 million; operating cash flow and EBITDA turned positive. Concerns remain: falling startup revenue and sales are warning signs; Taiwan still supplies 95% of revenue; and US$31.5 million in operating cash inflow included US$73.29 million in depreciation added back, while ongoing battery investment contributed to total cash outflow of US$84.55 million. With over US$300 million in borrowings, cash burn could worry lenders and necessitate an awkwardly priced equity raise. Overseas expansion is the biggest concern. These are November 2023 observations.

Key points

Battery-swapping revenue grew 10–14%, a positive trend supported by the installed base.
Losses narrowed and operating cash flow turned positive, but investing activities still consumed cash.
Taiwan generated 95% of revenue; overseas expansion was the biggest concern.
Borrowings of US$300 million create a repayment-versus-equity-funding dilemma.

Columns and beams in an open building are connected by central rods and balanced weights, suggesting structure and checks in governance. — Capital markets & governanceThematic illustration · AI generated

Full text — English translation

GGR: data for the first three quarters of 2023. Personally, I think it is reasonably okay. Revenue fell 10% year over year, partly because of exchange rates and partly because scooter unit sales declined, attributed to price cuts by gasoline-scooter manufacturers. This could actually affect fourth-quarter figures more. One good number is battery-swapping revenue growth of 10%, or 14% excluding currency effects. This should continue rising as GGR’s installed base in Taiwan grows. Gross margin was roughly flat, but the real price war began in the third quarter, so its actual impact may emerge in the fourth. The loss narrowed to US$3 million as GGR reduced/controlled selling, administrative, and R&D expenses, with selling expenses falling the most. Operating cash flow and EBITDA were positive. I will explain my thoughts below. A few concerns: 1. Falling revenue and unit sales are warning signs for a startup—just as a decline in Tesla’s sales ‘growth rate’ would be a big issue. 2. Taiwan still provides 95% of revenue. This number does not seem to have changed noticeably since listing. 3. I now focus more on startup cash flow. Operating cash inflow in the first three quarters was US$31.5 million, which would be relatively reassuring for a typical software startup. GGR is still a hardware company, however, and batteries probably make up a large share of its assets. Battery depreciation is substantial: US$73.29 million was added back in the first three quarters. The complication is that GGR must keep buying new batteries, so investing activities must also be considered. Overall cash outflow for the first three quarters was US$84.55 million. GGR needs to slow cash outflow. Third-quarter expense control appears to have reduced cash consumption, but it also seems to face stronger competition from traditional manufacturers in Taiwan. Failure to expand overseas and increase overseas revenue’s share would be the biggest concern. Rapid cash outflow could also affect future debt repayment capacity. There is still more than US$300 million in short- and long-term borrowings. If cash outflow worries the bank syndicate, the company will need ways other than borrowing to strengthen its finances, such as a cash equity offering. At the current share price, however, that would be rather awkward.

These articles are personal notes, book excerpts, and collected reprints. Figures and events reflect the time of the original publication, are not current information, and do not constitute investment advice.

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