{"id":30963,"date":"2022-09-07T10:52:00","date_gmt":"2022-09-07T14:52:00","guid":{"rendered":"https:\/\/autosector.com\/?p=30963"},"modified":"2022-09-07T10:52:00","modified_gmt":"2022-09-07T14:52:00","slug":"nio-calls-rest-of-year-critical-period-q2-earnings","status":"publish","type":"post","link":"http:\/\/autosector.com\/?p=30963","title":{"rendered":"Nio (NIO) calls rest of year \u2018critical period\u2019 for EV maker, as ES7 SUV and ET5 sedan deliver"},"content":{"rendered":"

Nio (NIO) released its Q2 earnings Wednesday morning as the Chinese EV maker enters a critical stage of development. With competition rising and the auto supply chain still in shambles, Nio\u2019s losses are widening as it introduces several new EVs to the market. <\/p>\n

Since its foundation in 2014, Nio has been a pioneer in the Chinese EV industry. The automaker was deemed the \u201cTesla of China\u201d after an explosive entrance, and then, after going public<\/a> in September 2018, Nio became a favorite among investors and EV enthusiasts alike.<\/p>\n

Between 2018 and 2021, Nio\u2019s revenue grew by over 630%. And after seeing Tesla stock explode in 2020, investors were not going to give up the chance to miss the next Tesla. As a result, Nio stock raced from under $5 a share in June 2020 to nearly $67 on January 11, 2021, gaining 1,240%. <\/p>\n

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Nio stock chart Source: Tradingview<\/figcaption><\/figure>\n

However, since then, new competition has entered the market in China and across the globe. Several EV makers and legacy automakers in China, like Xpeng<\/a>, Li Auto<\/a>, and BYD,<\/a> are introducing new EV models gaining market share. <\/p>\n

Nio shares have come down significantly since then, settling at around $18 per share. Supply chain challenges this year and lockdown in China over resurging Covid are cutting into profits and slowing vehicle deliveries as Nio\u2019s losses widen. <\/p>\n

Meanwhile, Nio introduced its flagship ET7 <\/a>electric sedan in March and began deliveries of its new ES7 EV SUV on August 28. The EV maker plans to further its EV lineup with the ET5<\/a> mid-sized sedan.<\/p>\n

Not only is Nio expanding its lineup, but it\u2019s also broadening its market by introducing new models, such as the ES7, to Europe and other parts of the globe (maybe the US?). Yet, Nio\u2019s Q2 earnings suggest the company has hit a critical threshold.<\/p>\n

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Nio ET7 Source: Nio<\/figcaption><\/figure>\n

What Nio\u2019s Q2 2022 earnings report is telling us<\/h2>\n

Nio delivered 25,059 EVs according to its Q2 earnings<\/a>. Although deliveries were still up 14% YOY, the pace has slowed significantly and is down 2.8% from Q1. <\/p>\n

Here\u2019s the delivery breakdown by model: <\/p>\n