Nio Reports Mixed Q1 Results, Chinese EV Manufacturer Guides To Strong Q2

Nio Inc's – ADR NIO first-quarter revenue missed estimates Thursday, but the bottom line exceeded expectations on cost control. The company has bounced back strongly off the COVID-19 pandemic and guided to a better second quarter than anticipated by the Street. 

Nio's Top-Line Miss, Bottom-Line Outperformance

The Shanghai-based electric vehicle maker reported a net loss attributable to ordinary shareholders of 1.7228 billion yuan ($243.3 million) for the first quarter, down 35% year-over-year and 40.5% quarter-over-quarter.

Excluding items, the loss per ADS came in at 1.60 yuan (22 cents), narrower than the year-ago loss of $2.56 yuan and the previous quarter's loss of 2.73 yuan.

The loss was narrower than the consensus loss estimate of 26 cents per share.

The company attributed its operating performance to enhanced cost control measures taken during the COVID-19 outbreak and the initial returns from continuous efforts in operation optimization and expense control during recent quarters.

Total revenues for the quarter were 1.372 billion yuan ($193.8 million), missing the consensus estimate of $234.1 million. This represented a 15.9% year-over-year decline and a 51.8% quarter-over-quarter drop.

Nio's Cash Position Still Precarious

Nio said in its quarterly release that cash and cash equivalents, restricted cash and short-term investments stood at $338.6 million as of March 31.

The company announced in late April a 7-billion-yuan cash infusion into Nio China by a consortium consisting of Hefei City Construction and Investing Holding, CMD-SDIC Capital and Anhui Provincial Emerging Industry Investment. As part of the deal, the company is moving its Chinese headquarters to Hefei city.

Nio Q1 Vehicle Deliveries, Margins Weaken

Nio said it delivered 3,838 vehicles in the first quarter compared to 8,224 in the fourth quarter of 2019 and 3,989 vehicles in the first quarter of 2019. Vehicle margins came in at a negative 7.4% compared to negative 6% in the fourth quarter of 2019 and negative 7.2% in the first quarter of 2019.

The situation has mproved from the COVID-19-induced slackness in the first quarter. In April, Nio delivered 3,155 vehicles, representing a 105.8% month-over-month increase and a 180.7% year-over-year jump.

"We have witnessed the order growth to have rebounded to the level prior to the COVID-19 outbreak since late April. Our strong recovery and growth were attributable to the competitiveness of our products and services, the continuous support from our user community, and the effective expansion of our sales network," William Lee, Nio's founder, chairman and CEO, said in a statement. 

Nio's Guidance

Nio expects vehicle deliveries of 9,500-10,000 in the second quarter, which would represent record performance for the company.

The company expects second-quarter revenues to be between 3.368 billion yuan and 3.534 billion yuan or $475.7 million to $499.1 million, exceeding the $350.9-million consensus estimate.

NIO Price Action 

After advancing 9.16% to $4.17 Wednesday in the wake of an JPMorgan upgrade, Nio shares were slipping by 3.84% to $34.01 in premarket trading Thursday. 

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Photo courtesy of Nio.