Nio Inc. narrowed its losses in the second quarter as it steps up cost controls in preparation for what its leadership has signaled could be the company’s first quarterly profit in the fourth quarter.
The Chinese electric-vehicle maker posted a net loss of RMB 4.99 billion ($697 million) for the quarter, the smallest quarterly loss since the fourth quarter of 2023. The figure marked a 1.0% year-on-year improvement versus Q2 2024 and a 26.0% quarter-on-quarter improvement from the first quarter of 2025. Nio attributed the smaller loss to disciplined spending as it works to scale deliveries and refine its product lineup.
Key metrics showed a seasonal mix shift and ongoing efficiency gains:
– Deliveries in the quarter reached 72,056 vehicles, within guidance of 72,000 to 75,000 units, with growth of 25.6% year-on-year and 71.2% quarter-on-quarter.
– Revenue stood at RMB 19.01 billion, up 9.0% from Q2 2024 and 57.9% from Q1 2025.
– Vehicle sales revenue was RMB 16.14 billion, up 2.9% year-on-year and 62.3% quarter-on-quarter.
– Gross margin was 10.0%, improving from 9.7% a year earlier and from 7.6% in Q1 2025.
– Vehicle margin was 10.3%, versus 12.2% in Q2 2024 and 10.2% in Q1 2025.
Nio’s research and development spending declined, reflecting shifting development phases and lower depreciation and amortization:
– R&D expenses totaled RMB 3.01 billion, down 6.6% year-on-year and 5.5% from the prior quarter.
Selling, general, and administrative costs rose modestly on a yearly basis but eased from the previous quarter:
– SG&A costs were RMB 3.96 billion, up 5.5% year-on-year but down 9.9% sequentially.
On the balance sheet and liquidity front, Nio reported:
– Cash-related holdings (cash and cash equivalents, restricted cash, short-term investments, and long-term time deposits) of RMB 27.2 billion as of June 30.
– An operating cash outflow in the quarter and negative shareholders’ equity as of June 30, reflecting a working-capital dynamic that the company says remains within disclosed risk factors.
– Management stressed that liquidity should be sufficient to support ongoing operations for the next 12 months.
Guidance for the next quarter signals continued volume momentum:
– Third-quarter deliveries are guided to 87,000 to 91,000 units, representing roughly 40% to 47% year-on-year growth.
– This implies September deliveries could be in the high-30,000 range, with numbers cited as 38,678 to 34,678 in one guidance line—a reversal in order that appears to be a misprint in the release; readers should interpret the September figure as a high-30,000s target rather than a precise, single-point number.
– Nio reaffirmed its third-quarter revenue outlook of RMB 21.81 billion to RMB 22.88 billion, up about 16.8% to 22.5% from the prior-year period.
Product and growth initiatives include the upcoming refresh of the ES8, expected to launch by the end of September, which is anticipated to bolster third-quarter momentum. The company is also progressing with its newer platforms, including Onvo and Firefly, as part of its strategy to expand into higher-growth segments.
Leadership commentary emphasizes rebuilding consumer confidence as a pathway to profitability. Founder and CEO William Li has underscored that, while profitability remains challenging, it is achievable in the intended fourth quarter, and achieving it could help dispel lingering concerns about Nio’s financial stability.
What this means for investors
– The quarter reinforces that Nio’s path to profitability hinges on maintaining strong delivery growth, further improving gross and vehicle margins, and sustaining disciplined cost management.
– The presence of negative shareholders’ equity in the near term highlights balance-sheet risks, though management asserts liquidity should cover the company’s needs for the coming year.
– The projected Q3 delivery ramp and the ES8 refresh suggest catalysts for near-term momentum, but investors will be watching for continued improvement in gross margins and a clearer path to sustained profitability.
Summary
Nio posted a smaller quarterly loss as it trims costs and pushes growth through higher-volume deliveries and new product cycles. With deliveries and revenue rising and a clear focus on cost discipline, the company is positioning itself for potential profitability later in the year, subject to maintaining favorable product mix and continued demand.
Additional note
– If you’re covering this story, it may be helpful to provide readers with a quick snapshot of the main momentum drivers (delivery growth, new models and platforms), a caveat about the September delivery range typo, and a short explainer on how the company plans to balance growth with margin improvement in the coming quarters.