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HomeFinanceNio stock bounces as losses doubled expectations but delivery outlook was upbeat

Nio stock bounces as losses doubled expectations but delivery outlook was upbeat


Shares of Nio Inc. rallied Thursday, off a more-than-two-year low in the previous session, after the China-based electric vehicle maker reported third-quarter per-share losses that were more than double what was expected while projecting another deliveries record for the current quarter.

The net loss for the quarter to Sept. 30 widened to RMB3.68 billion ($517.1 million), or RMB2.53 per American depositary share (ADS), from RMB815.4 million, or RMB1.82 per ADS, in the same period a year ago.

Excluding nonrecurring items, the adjusted loss per ADS was RMB2.11, compared with the FactSet loss consensus of RMB1.04.

Revenue jumped 32.6% to RMB13.00 billion ($1.83 billion) but was below the FactSet consensus of RMB13.07 billion.

Cost of sales climbed more than revenue, up 44.2% to RMB11.27 billion ($1.58 billion) due to the increase in delivery volume and higher battery cost per vehicle, knocking gross margin down to 13.3% from 20.3%.

Still, Nio’s U.S.-listed shares

ran up 5.5% in premarket trading, after sinking 20.1% over the past three days to close Wednesday at the lowest price since July 1, 2020.

Weighing on the stock recently has been slowing industry sales in China, with production hurt by COVID-related lockdowns as the government enforced its zero-COVID policy. The stock has plunged 53.9% over the past three months through Wednesday, while the iShares China Large-Cap exchange-traded fund

has dropped 22.3% and the S&P 500 index

has lost 11.0%.

As previously reported, deliveries for the quarter rose 29.3% to a quarterly record of 31,607.

Chief Executive William Bin Li said Nio has witnessed “strong growth momentum in user demand and robust foot traffic” in its stores, especially after the debut of the ET5 midsize sedan. “To meet the growing user demand and shorten the waiting time, we have been working closely with supply chain partners to accelerate production and delivery,” he said.

For the fourth quarter, the company expects deliveries to rise 71.8% to 91.7% from a year ago to between 43,000 and 48,000 vehicles, which would represent another quarterly record.

Meanwhile, revenue for the current quarter is projected to be between RMB17.37 billion and RMB19.23 billion, below the FactSet consensus of RMB21.78 billion.


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