Nio Stock Slides After Rally Despite Profit Breakthrough

Nio ( (NIO) ) has fallen by -8.76%. Read on to learn why.

Nio’s stock fell 8.76% over the past week, a pullback that comes after a powerful multi-week rally driven by improving fundamentals and growing optimism around the Chinese EV maker’s 2026 outlook. The market had bid the shares up on the back of Nio’s first-ever quarterly net profit, surging deliveries, and upbeat guidance for Q1 2026 shipments of over 80,000 vehicles, implying close to 100% year-on-year growth. As the initial excitement cooled and traders locked in gains, the share price gave back some ground despite the company’s operational progress.

Under the hood, Nio’s recent results mark a notable shift in its story. In Q4 2025 the company delivered more than 120,000 vehicles, driving revenue growth of over 70% and allowing it to turn a positive operating profit and net income for the first time. Sales momentum is being fueled by a broadening product mix across its NIO, ONVO, and FIREFLY brands, aimed at both premium and more price-sensitive buyers, while vehicle gross margins have improved thanks to newer models and tighter cost control. This combination of record deliveries, better margins, and disciplined spending is leading some investors to see Nio as having reached an “inflection point” toward more sustainable growth.

Wall Street’s stance has generally shifted in Nio’s favor, even as the stock digests recent gains with this week’s decline. Major firms such as HSBC and Nomura upgraded the shares to Buy and raised price targets, arguing that the current valuation looks attractive given expected shipment and revenue growth through 2028. Analysts now see Nio entering a more active business cycle, with several new SUV models scheduled to launch and consensus calling for shipments and revenue to grow at healthy double-digit annual rates. For investors watching the recent 8.76% drop, the key question is whether this is a normal pause after a sharp rebound—or an early sign that the market’s high expectations for Nio’s next growth phase will be harder to meet.