Nio Inc ((NIO)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Nio Inc’s Latest Earnings Call: A Mixed Sentiment with Strong Growth and Challenges
The recent earnings call of Nio Inc. painted a picture of robust operational performance, marked by significant delivery growth and improved financial metrics. The company reported strong cash flow, indicating a positive trajectory. However, the discussion was not without its challenges, as the impact of subsidy phase-out and a lowered Q4 delivery guidance were highlighted.
Strong Delivery Growth
Nio Inc. showcased impressive delivery numbers, with 87,071 smart EVs delivered in Q3 2025, reflecting a year-over-year growth of 40.8%. October alone saw deliveries reaching 40,397 smart EVs, marking a staggering 92.6% increase compared to the previous year.
Improved Financial Metrics
The company reported an improvement in vehicle gross margin to 14.7% and an overall gross margin of 13.9%, the highest in nearly three years. Furthermore, Nio’s non-GAAP operating loss narrowed by 30% quarter over quarter, indicating enhanced operational efficiency.
Record Revenue
Nio’s total revenues surged to 21.8 billion RMB, a 60.7% increase year-over-year. Vehicle sales contributed significantly to this growth, with revenues reaching 19.2 billion RMB, up 15% from the previous year.
Positive Cash Flow
In the third quarter, Nio achieved positive operating and free cash flow, a significant milestone that underscores the company’s financial health and operational success.
Significant Equity Financing
To further strengthen its balance sheet, Nio completed a total of $1.16 billion in equity financing, providing the company with additional financial flexibility.
Impact of Subsidy Phase-Out
The phase-out of trade-in and replacement subsidies since October has impacted sales, particularly for the Amo L60 and L90 models, posing a challenge for the company moving forward.
Lower-than-Expected Q4 Delivery Guidance
Nio adjusted its Q4 delivery guidance to 120,000 to 125,000 units, approximately 20% lower than the previous target of 150,000 units, primarily due to the subsidy phase-out.
R&D and SG&A Expenses
While R&D expenses decreased by 28% year over year, raising concerns about long-term innovation, SG&A expenses saw a 5.5% increase quarter over quarter, reflecting ongoing operational investments.
Forward-Looking Guidance
Looking ahead, Nio projects fourth-quarter deliveries between 120,000 and 125,000 units, with expectations of gross margin improvement to 18%, driven by high-margin products like the ES8. The company ended the quarter with 36.7 billion RMB in cash and equivalents, supported by a $1.16 billion equity offering. Nio’s strategic focus remains on cost optimization and expanding its global market presence, particularly through the Firefly and Amo brands.
In conclusion, Nio Inc.’s earnings call revealed a company experiencing strong growth and financial improvements, yet facing challenges due to external factors like subsidy phase-out. The overall sentiment was positive, with key takeaways highlighting robust delivery growth, improved financial metrics, and strategic financial maneuvers to bolster future performance.