Nio Shares Jump 14% over Q2 Revenue and Guidance Beat
TMTPost -- The American depositary receipts (ADRs) of Nio Inc. jumped 14.4% Thursday, outperforming the U.S. stock market as the benchmark S&P 500 edged down 0.3% lower. Shares rallied after the Chinese electric vehicle (EV) maker posted stronger-than-anticipated top line and guidance.
Credit：Nio
Nio said its total revenue soared 98.9% year-over-year (YoY) to RMB17.45 billion (US$2.16 billion) for the quarter ended June 30, beating Wall Street projection of RMB17.38 billion. On non GAAP basis, adjusted loss from operations, excluding share-based compensation expenses, narrowed 14% YoY to RMB4.7 billion, whereas analysts estimated loss of RMB4.86 billion. Excluding share-based compensation expenses, adjusted net loss Gross margin increased 8.7 points YoY to 9.7%, topping expectation of 8.74%.
Nio’s stellar revenue resulted from three-digit growth of vehicle business. The EV company delivered 57,373 vehicles for the second quarter, representing a 143.9% YoY increse and a 90.9% quarter-over-quarter (QoQ) increase. The revenue sales was mainly driven by the increase in delivery, partially offset by the lower average selling price (ASP) due to changes in product mix and user rights adjustments since 2023.
“In the second quarter of 2024, NIO achieved a record-breaking delivery of 57,373 premium smart electric vehicles, securing over 40% of the market share in the battery electric vehicle segment priced above RMB 300,000 in China,” said Nio chairman and CEO Li Bin, or William Li.
Vehicle revenue for the second quarter surged 118.2% YoY to RMB15.68 billion. Vehicle margin stood at 12.2%, compared with 6.2% a year ago. Nio mainly attributed upward margin to decreased material cost per unit, despite lower ASP as a result of the user rights adjustments since June 2023. Decrease in delivery and lower vehicle margin is one of the biggest reasons that Nio stocks plunged in recent months. The drop in production was largely owing to Nio’s upgrade of models based on its next generation technology platform. As the upgrade completed in April, delivery and margin of the company are expected to recover.
“Due to ongoing cost optimizations, our vehicle gross margin increased to 12.2% in the second quarter,” added Stanley Yu Qu, Nio’s chief financial officer (CFO), “We will continue to focus on efficient R&D and infrastructure investment, leverage the growth potential in the mass market, adopt flexible market strategies and continuously optimize our product portfolio. We are confident that these efforts will result in steady improvements in gross profit and cost efficiency in the future.”
Looking forward the third quarter, Nio saw total revenue between RMB19.11 billion to RMB19.67 billion, representing an increase of about 0.2% to 3.2% YoY. It expected delivery that quarter between 61,000 and 63,000 units. Both the revenue and delivery guidance hit quarterly record. Wall Street was looking for sales of about $2.5 billion from 57,000 vehicles.
Li Bin highlighted the latest launch that was warmly welcomed by customers. On September 1, Nio opened 105 stores opened for L60, the inaugural model of its second brand ONVO. Li said L60 has been widely embraced by the market since its debut and we expect the new brand to secure a strong position for Nio in the mass market. The brand has commenced its initial presentations and is expected to be officially launched and begin deliveries within this month.
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