Q2 2023 Nio Financial Results

Chinese electric vehicle manufacturer Nio experienced a loss of $835.1 million in the second quarter, which is more than double its loss from the previous year. This decline was primarily due to reduced deliveries of its premium electric vehicles (EVs) as the company underwent a transition to an upgraded vehicle platform. Additionally, China’s economic slowdown has had a broader impact on the company.

Let’s take a look at the key financial figures from Nio’s second-quarter earnings report, comparing them with the estimates provided by Wall Street and reported by Refinitiv:

• Revenue: 8.77 billion yuan ($1.21 billion), lower than the expected 9.25 billion yuan.
• Adjusted loss per share: 3.28 yuan (45 cents), higher than the expected 2.45 yuan.

Following this announcement, Nio’s shares dropped by 9% during early trading.

It’s important to note that Nio’s adjusted figures exclude share-based compensation expenses. On a GAAP basis, the company reported a net loss of $835.1 million, equivalent to 51 cents per share.

In Chinese yuan, Nio reported a net loss of 6.06 billion, equivalent to 3.70 yuan per share. In comparison, the company had reported a net loss of 2.76 billion yuan, or 1.68 yuan per share, with a revenue of 10.29 billion yuan in the same period last year.

The gross margin on vehicles for the second quarter was 6.2%, a significant decrease from 16.7% in the previous year but a slight increase from 5.1% in the first quarter of 2023.

In May, Nio launched a revamped version of its popular ES6 crossover on its new “NT2.0” platform. Additionally, in June, a station wagon version of its ET5 sedan was introduced. These refreshed models have already shown promising results with the delivery of 20,462 vehicles in July alone.

During the second quarter, the company delivered only 23,520 vehicles as it phased out its older models with substantial discounts.

CEO William Bin Li expressed confidence in a statement, stating that Nio’s July performance placed it at the top of China’s sales charts for EVs priced above 300,000 yuan, which amounts to approximately $41,000.

Li said, “We anticipate a significant increase in vehicle deliveries in the second half of 2023.”

Furthermore, Nio strengthened its balance sheet in July by securing a $738.5 million equity investment from a fund controlled by the Abu Dhabi government. As of the end of June, the company had $4.3 billion in cash and equivalents.

For the third quarter, Nio projects delivering between 55,000 and 57,000 vehicles, a substantial increase from the 31,607 EVs delivered in the same period last year. The company expects its revenue for the period to range between $2.61 billion and $2.69 billion, compared to $1.83 billion in the previous year.