Shares in NIO Inc. (NYSE: NIO) plunged over 6% in the pre-market trading Tuesday following the release of second-quarter financial results. The Chinese electric vehicle (EV) firm posted a wider-than-expected net loss amid lower sales and deliveries.
The company recorded a net loss of RMB5.79 billion ($798.9 million) for the second quarter, a notable increase from RMB2.26 billion recorded in the same period a year ago.
The adjusted losses per American depositary share (ADS) stood at RMB3.28, missing the consensus analyst forecast of RMB2.96.
Revenue amounted to RMB8.77 billion ($1.21 billion), marking a 14.8% year-on-year decrease and falling short of market projections set at RMB9.16 billion.
Vehicle sales plummeted by over 22% compared to the previous quarter, with a year-on-year drop of 24.9%.
NIO chief executive William Bin Li provided some positive insight, noting an improvement in EV delivery volumes since the end of the June quarter.
He said,
“NIO delivered 23,520 vehicles in the second quarter of 2023. In July 2023, NIO delivered 20,462 vehicles, representing a substantial increase of 103.6% year-over-year, which propelled NIO to the top position in China’s premium electric vehicle market for vehicles priced above RMB300,000.”
Steven Wei Feng, the Chief Financial Officer of NIO Inc. (NYSE: NIO), highlighted a significant recent investment into the company.
“In July 2023, NIO closed the US$738.5 million strategic equity investment from CYVN Entities, which demonstrated NIO’s unique values in the smart electric vehicle industry. This transaction further strengthened our balance sheet, powering our continuous endeavors in accelerating business growth, driving technological innovations, and building long-term competitiveness.”
“We will remain dedicated to improving our operational efficiency while pursuing continuous growth.”
NIO updated its Q3 revenue guidance to RMB18.90-19.52 billion, surpassing last year’s RMB13.00 billion and analyst consensus of RMB18.03 billion.
The company plans to increase EV deliveries to 55,000-57,000 in Q3, up from 31,607 last year.
As of press time, NIO stock declined 6.67% to $10.28 ahead of Tuesday’s open.
