Nio reports wider first-quarter loss as Covid shutdowns in China hamper deliveries

Chinese electric-vehicle maker Nio lost $281.2 million in the first quarter, wider than the $68.8 million it lost a year ago, as it scrambled to keep pace with intense demand amid China’s recent Covid-related shutdowns.

Here are other key numbers from Nio’s first-quarter earnings report.

• Revenue: $1.56 billion, up 24% from the first quarter of 2021.
• Adjusted loss per share: 13 cents, versus 4 cents in the first quarter of 2021.
• Gross margin: 14.6%, versus 19.5% a year earlier and 17.2% in the fourth quarter of 2021.
• Cash at quarter-end: $8.4 billion, down slightly from $8.7 billion as of the end of 2021.

Nio’s shares were down about 9% in early trading Thursday as investors digested the decline in gross margin.

Rising commodity costs have continued to squeeze margins, CEO William Bin Li said during the company’s earnings call. But he expects Nio’s gross margin to begin to recover in the third quarter as offsetting cost cuts take hold.

Nio said its new factory, the company’s second, has begun pre-production builds of the upcoming ET5 sedan, due in September. The company also confirmed plans to launch a new upscale, five-passenger SUV, the ES7, later this month, with deliveries beginning in August.

Nio delivered 25,768 vehicles in the first quarter, up from 20,060 a year ago. Second-quarter deliveries are on pace to reach between 23,000 and 25,000 vehicles, the company said, suggesting a particularly strong June. Covid-19 shutdowns and supply-chain issues limited Nio’s total deliveries in April and May to just over 12,000.

Demand has remained strong through China’s most recent pandemic disruptions, however. Li said Nio “achieved an all-time high order flow” in May.

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