NIO reports strong growth in deliveries and sales, but high expenses lead to significant losses

From Yahoo Finance: 2025-06-19 19:24:00

In Q1, NIO missed top and bottom-line estimates, reporting a loss of $0.42 per share. Despite growing deliveries and sales, high expenses lead to significant cash burn. Deliveries increased 40%, but revenue only grew by 18.6%. Operating losses rose to $884 million, despite revenue reaching $1.66 billion. NIO raised $510 million through a share issuance in Hong Kong to strengthen liquidity.

CEO aims for breakeven by Q4, but a troubling 18% rise in Q1 operating losses suggests otherwise. Cost efficiency focus includes cutting R&D spending and SG&A expenses. NIO expects 72,000 to 75,000 vehicle deliveries in Q2, aiming to improve cash flow and narrow losses. Product launches show promise in securing market share in premium segments.

The ongoing price war in China’s EV market is eroding profitability, affecting NIO’s bottom line. R&D expenses increased by 11%, while SG&A costs accounted for 46% of sales revenue. Analysts remain cautious on NIO, with a consensus price target of $4.51 implying a 31% upside. NIO’s delivery and revenue growth show competitiveness, but bottom-line losses remain a concern.

Q1 lacked operational efficiency improvements, keeping investors reliant on expense reduction promises. Until visible progress towards profitability is made, a Hold rating is maintained on NIO. Analysts remain cautious, with optimism for a potential upside despite the neutral stance. NIO’s ability to remain competitive in China’s EV market is showcased through delivery and revenue growth.



Read more at Yahoo Finance: NIO Stock Presents a Mixed Outlook as Strong Growth is Offset by Persistent Losses