X Nio’s EV deliveries rose 14% year over year in the second quarter. They slowed in July and August from June, but remained above 10,000 in both months. The once-hot Chinese electric vehicle startup has seen headwinds mount. Those headwinds include new export restrictions on Nvidia ( NVDA ), a Nio chip supplier. It also includes intense new competition and new Covid-19 lockdowns in China. Investors will be keen to learn how Nio is managing persistent supply challenges while pursuing ambitious growth strategies. Tesla’s ( TSLA ) emerging rival is launching several new EVs, expanding overseas and eyeing a massive foray into the market.
Neo Earnings
Estimates: Analysts polled by FactSet expected net loss to widen to 16 cents a share on the U.S. treasury stock from 6 cents a year ago. Revenue is seen rising 8.5% to $1.415 billion, below the low end of Nio’s Q2 guidance range. Results: Nio lost 20 cents per share, while revenue rose 22% to $1.54 billion. Outlook: Nio sees 3Q revenue of $1.918 billion – $2.03 billion. Wall Street had expected 3Q revenue of $2.38 billion, up 55%. The EV maker also sees Q3 deliveries of 31,000-33,000. With 20,729 EVs already delivered in July and August, that means September deliveries of 10,271-12,271.
Neo Stock
Shares were down 4.4% in pre-market trading today. Nio stock lost 3.5% to 17.11 on Tuesday. Nio stock met resistance at its 50-day moving average in late August and remains well below its 200-day moving average. Startup rivals Li Auto ( LI ) and Xpeng ( XPEV ) were down about 1 percent early Wednesday after losing more ground on Tuesday. Li Auto stock fell to a three-month low while XPEV stock fell 5.1% to a record low. China’s EV giant BYD ( BYDDF ) rebounded 0.8% on Tuesday, following a four-session slide as Warren Buffett sold a small portion of his large stake. Tesla stock rose 1.6%, behind its 50-day moving average, as it struggles for support there. EMs rise after Nasdaq falls again. This solar stock shines
Nio EV Sales, Growth Strategies
Nio was founded in November 2014 and targets the Chinese premium electric car market. As of August, it had produced and sold nearly a quarter of a million electric vehicles cumulatively. EV sales more than doubled for Nio — and for China overall — in 2021. However, a prolonged chip shortage and other supply disruptions hit Nio’s EV production and sales earlier this year. Nio sold 25,059 electric vehicles in Q2, roughly in line with top-line delivery guidance. It sold 10,052 EVs in July and 10,677 EVs in August, both below June levels. However, the EV startup increased deliveries in August compared to the previous month, outpacing Xpeng and Li Auto, which reported declines. In July, a shortage of die-casting parts hurt production of Nio electric vehicles, including the flagship new ET7 electric sedan. But Nio began delivering the new ES7 SUV on August 28 and plans to launch the smaller ET5 sedan on September 30. In addition to its growing EV lineup, Nio plans to expand overseas, sending the luxury ET7 to Europe. It already sells electric vehicles in Norway and aims to be in 25 countries by 2025. Various reports suggest Nio could launch a mass-market EV, challenging Volkswagen (VWAGY) in China. YOU MIGHT ALSO LIKE: These are the 5 best stocks to buy and watch now Stocks to watch: Top rated IPOs, large caps and growth stocks Find the latest stocks hitting buy zones with MarketSmith Because this IBD tool simplifies the search for top stocks Looking for the next big stock market winners? Get started with these 3 steps
