NIO Inc. NIO reported second-quarter loss per ADS of 15 cents, narrower than the Zacks Consensus Estimate of 34 cents. The loss also narrowed from the year-ago figure of 45 cents per share. The China-based EV maker posted revenues of $526.4 million, up 146.5% year over year. The top line also surpassed the consensus mark of $486 million. Robust deliveries in second-quarter 2020 led to the outperformance.
Key Takeaways
While the COVID-19 outbreak weighed on the firm’s first-quarter vehicle deliveries, stabilization of the pandemic in China led to rebound in sales in the second quarter.NIO delivered 10,331 vehicles in the second quarter of 2020, including 8,068 ES6s and 2,263 ES8s. Total deliveries rose 190.7% year over year.
Revenues generated from vehicle sales amounted to $493.4 million, representing an uptick of 146.5% from the corresponding quarter of 2019. Other sales amounted to $33 million, 147.7% higher than the year-ago period on the back of increased revenues derived from the home chargers installed, service package and energy package subscribed.
Importantly, vehicle margin for the quarter under review was 9.7% versus negative 24.1% in the year-ago period. Lower unit manufacturing costs and decrease in the purchase price of certain materials led to the improvement in vehicle margins. Gross margin was 8.4% versus negative 33.4% in second-quarter 2019 on the back of robust sales and increased vehicle margin. R&D and SG&A costs were $77.2 million and $132.6 million, reflecting a year-over-year decrease of 58.1% and 34.1%, respectively.
Cash and cash equivalents totaled $1.5 billion as of Jun 30, 2020. Long-term debt was around $998 million.
NIO expects third-quarter deliveries in the band of 11,000-11,500 vehicles, signaling an uptick of around 134.5% at the mid-point of the range. Third-quarter revenues are forecast between $572.9 million and $596.2 million, indicating a rise of 125% from the corresponding quarter of 2019.
Zacks Rank & Key Picks
NIO currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the same sector include BRP Inc. DOOO, Garrett Motion Inc. GTX and LCI Industries LCII, each carrying a Zacks Rank of 1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
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