China-based electric-vehicle maker Nio reported a widening third-quarter loss Tuesday, even as revenue and deliveries surged.
Nio said it lost 4.56 billion Chinese renminbi, wider than the 4.11 billion renminbi it lost in the year-earlier quarter, while revenue more than doubled to 19.07 billion renminbi as vehicle sales rose 46%.
On an adjusted basis, the EV maker, which focuses on higher-end models, said it lost 2.28 renminbi per share, or 31 U.S. cents per share.
Analysts polled by Visible Alpha expected a loss of 2.49 renminbi on revenue of 19.3 billion renminbi.
The company’s vehicle margin was 11%, versus 16.4% in the year-earlier quarter.
Nio shares
NIO,
rose 3% in early trade, though the stock has dropped 23% this year.
“Nio’s profitability is one of the biggest concerns among investors right now,” said Rosalie Chen, an analyst at the research service Third Bridge.
On a conference call, company executives said 50% of sales volume is in just three areas — Jiangsu, Zhejiang and Shanghai — which they said shows that its products are well-recognized in competitive markets, but also the need to enhance brand awareness elsewhere, according to a FactSet transcript.
They also noted aggressive pricing by competitors such as BMW
BMW,
and Mercedes
MBG,
but that Nio doesn’t want to boost volumes at the expense of margins.
Nio is expecting revenue to rise between 0.1% and 4% in the fourth quarter, on a deliveries increase between 17.3% and 22.3%.
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