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Nio Reports Q1 Beat Amid Strong Demand, Forecasts Deliveries Growth Despite Chip Shortages

Chinese EV manufacturer NIO Inc. (NYSE: NIO) announced Thursday first-quarter results that beat estimates. The company also issued above-consensus revenue guidance for the second quarter, with deliveries expected to grow despite the significant supply chain challenges.

Nio’s Key Q2 Metrics: Nio reported first-quarter non-GAAP net loss of 0.23 yuan, or 4 cents per share. This compares to a loss of 1.60 yuan per share reported a year ago. Revenues climbed 481.8% year-over-year and 20.2% quarter-over-quarter to 7.9823 billion yuan, or $1.2183 billion.

Analysts, on average, estimated a loss of 16 cents per share on revenues of $1.02 billion. The company had guided to revenues of $1.1314 billion to $1.1582 billion.

Vehicle revenues, accounting for 92.8% of the total revenues, came in at $1.1303 million. The 489.8% year-over-year increase in vehicle revenues was attributed to higher deliveries, expansion of sales networks and an easier comparison with the COVID-19-hit year-ago quarter.

Vehicle margin improved to 21.2% from a negative 7.4% in the year-ago quarter and 17.2% in the previous quarter.

Balance of cash and cash equivalents, restricted cash and short-term investment was $7.3 billion as of March. 31.

Delivery Momentum Continues: As disclosed earlier, the company delivered 20,060 vehicles in its first quarter, a quarterly record and a 432% year-over-year increase.

The strong performance came despite the company having to shut down production at its Hefei plant for five working days, beginning March 29, due to shortage of chip supply.

Related Link: Investment Arm of World’s Second-Largest Reinsurer Swoops In On Nio, Tesla Stock In Q1

Nio Amid Frenzied Activity: Nio began the year with the unveiling of its first-ever sedan, dubbed ET7, at the Nio Day held in early January. The company also announced Power Swap Station 2.0 and new battery packs at the event.

The Power Swap Station 2.0, according to Nio, boosts the service capacity of each station to a maximum 312 times per day by shortening the battery swapping time to under three minutes.

The company announced a partnership with Chinese oil giant Sinopec Shanghai Petrochemical Company Limited (NYSE: SHI) for setting up its power swap station at the latter’s gas filling station.

The company made positive headlines at the Shanghai Auto show held earlier this month.

Nio has scheduled a press conference on May 6 to announce its international expansion plan, with the first stop at Norway. It’s also reportedly working on manufacturing a low-end vehicle model armed with lithium iron phosphate batteries.

The company also commenced construction of a smart EV part in collaboration with the Hefei municipal government. Reports suggest the company is doing the groundwork for a secondary listing in the Hong Kong stock exchange.

During the first quarter, the company tapped the debt market and sold $1.5 billion worth of convertible senior notes.

Nio’s Guidance: For the second quarter, Nio expects deliveries of 21,000-22,000 vehicles, up an estimated 103%-113% year-over-year and 5%-10% higher than in the previous quarter.

The company noted that overall demand for its products continues to be strong but the supply chain is still facing significant challenges due to the semiconductor shortage.

“Going forward, we will continue to invest in new products and core technologies, as well as in our service and power network expansion, particularly battery swapping and charging facilities,” said CFO Steven Wei Feng.

The company guided to second-quarter revenues of $1.243 billion to $1.298 billion, while the Street is modeling revenues of $1.21 billion.

Separately, Nio said it has convened an has called an extraordinary general meeting of shareholders on June 3 to consider and, if thought fit, pass the proposal to amend and restate the company’s memorandum and articles of association.

Nio Stock: Nio shares have been moving in a lackluster fashion ever since they hit a record high of $66.99 on Jan. 11. The stock has lost about 15% for the year-to-date period.

Reacting to the first-quarter results, the stock was down 1.26% to $38.50.

© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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