Analysis of the Impact of CATL's 2404 Stock Option Cancellation Event

Based on an analysis of CATL (300750.SZ), I will comprehensively evaluate the impact of the 2404 stock option cancellation event from multiple dimensions:

CATL announced on December 5, 2025, its decision to cancel 2404 granted but unexercised stock options [1]. The reasons for cancellation include: some incentive recipients leaving the company and the expiration of the third exercise period without exercising the options. In terms of stock price performance, the company’s current stock price is 383.42 yuan, up 1.32% today, reflecting a relatively mild overall market reaction to this news [0].

• Canceling unexercised options reflects the company’s strict incentive management system.
• It follows the common practice of “revoking eligibility when incentive recipients leave”, demonstrating the standardization of the company’s governance.
• This practice prevents resigned employees from retaining incentive rights, protecting the interests of current employees and shareholders.

• The expiration of the third exercise period without exercise may indicate insufficient premium of the current stock price relative to the option exercise price.
• This indicates that the company’s option pricing is relatively conservative and will not easily dilute shareholder equity.
• Investors may interpret this as a signal that the company will not over-issue equity incentives.

• The departure of some incentive recipients may imply that the company is facing certain talent loss pressure.
• In the highly competitive new energy industry, the departure of core technical personnel deserves attention.

• The non-exercise in the third period may reflect insufficient attractiveness of the incentive plan to some employees.
• Investors may question the effectiveness of the company’s incentive mechanism.

• Strictly implementing the option term and canceling unexercised options upon expiration reflects the seriousness of the plan.
• This practice helps maintain the scarcity and value of the incentive plan.

• Canceling options of resigned employees helps tilt incentive resources toward current core employees.
• Improves the precision and effectiveness of the incentive plan.

• It is recommended that the company analyze the reasons for non-exercise in the third period.
• It may be necessary to adjust exercise conditions or incentive methods to enhance incentive attractiveness.

• Regarding the issue of incentive recipients leaving, core talent retention measures need to be strengthened.
• Consider combining equity incentives more closely with long-term service commitments.

• The 2404 stock options have a negligible impact on the company’s total share capital.
• After cancellation, the company’s total share capital will not change, and there will be no dilution of existing shareholders’ equity.
• There is no substantial impact on financial indicators such as earnings per share (EPS).

• Canceling recognized stock option expenses may bring certain accounting gains.
• However, the amount is relatively small, and the impact on the company’s overall financial performance is limited.

In the new energy industry, relatively high employee mobility is a common phenomenon. CATL’s approach is consistent with that of mainstream international technology companies:

• Companies like Google and Microsoft strictly implement the policy of canceling options for resigned employees.
• New energy companies like Tesla also have similar option management systems.

This standardized management method actually enhances investors’ confidence in the company’s governance.

1. Short-term
   : The event has a neutral impact, and the stock price reaction has been basically digested.
2. Mid-term
   : Pay attention to the company’s subsequent incentive policy adjustments and talent retention measures.
3. Long-term
   : The option cancellation reflects the standardization of the company’s governance, which is a positive signal.

1. Closely monitor changes in the turnover rate of the company’s core technical personnel.
2. Pay attention to the adjustment and implementation effect of subsequent incentive plans.
3. Track changes in the company’s position in industry talent competition.

The event of CATL canceling 2404 stock options has an overall positive impact on investor confidence and the company’s incentive plan. This measure reflects the standardization of the company’s governance and the strictness of incentive management. Although it may imply certain talent flow pressure, it is a normal phenomenon in the context of competition in the new energy industry. Investors should focus more on the company’s fundamental performance and long-term development prospects rather than over-focusing on such routine governance behaviors.

[0] Gilin API Data - CATL Stock Real-time Quotes and Company Fundamental Data
[1] Zhihu - Discussion on “CATL Cancels 2404 Stock Options” (https://www.zhihu.com/tardis/bd/art/1908944086574019490)
[2] Zhihu - “CATL” Company Information (https://www.zhihu.com/topic/20205999)