This month, NIO has been tormented by public opinion.
On December 5th, NIO released its third quarter financial report and held a conference call, which was nearly a month later than the same period last year. This time was 26 days and 20 days later than the other two companies in NIO Xiaoli.
In the third quarter, NIO's total revenue was 19.067 billion yuan, a year-on-year increase of 46.6%, mainly from automobile sales, with automobile sales reaching 17.409 billion yuan, accounting for 91.3% of the total revenue; The gross profit margin during the same period was only 8%, a year-on-year decrease of 5.3 percentage points. Among them, the gross profit margin for automobiles was 11%, a year-on-year decrease of 5.4 percentage points; The net loss reached 4.557 billion yuan, with a year-on-year increase of 10.8% in the loss amount.
The lackluster "transcript" is followed by a sluggish fourth quarter performance outlook. Li Bin, founder of NIO, stated that the expected delivery of vehicles in the fourth quarter is between 47000 and 49000. Based on delivery data from October and November, a minimum of 15000 vehicles need to be delivered in December to complete the guidelines; The total revenue is expected to be 16.079 billion to 16.701 billion yuan, a year-on-year increase of 0.1% to 4%.
Li Bin explained during a conference call that the delivery guide of 47000 to 49000 yuan is due to the more intense price war at the end of the year. NIO is not prepared to promote sales by lowering prices, but to increase sales through improving sales services and other aspects.
Gross profit has not improved yet
The increase in NIO's revenue is closely related to the significant increase in delivery volume.
In June, the 8 NIO models completed the transition from the first generation platform to the second generation platform, laying the foundation for the momentum of the third quarter; In the same month, NIO announced the unbinding of its exchange rights; In September, the company launched a new generation of EC6 to help boost sales, and a series of measures helped record high delivery volumes in the third quarter.
Due to the temporary delivery improvement brought by the unbinding of NIO's battery swapping rights, the company's monthly delivery exceeded 20000 vehicles for the first time in July. However, it only lasted for one month, and the delivery volume in August and September fell back to 10000 vehicles, maintaining around 15000 vehicles. Continuous deliveries exceeding 10000 vehicles still helped the company's overall delivery volume reach 55400 vehicles in the third quarter, a year-on-year increase of 75.4%.
It is worth noting that the delivery guidelines provided by Li Bin in the second quarter ranged from 55000 to 57000 vehicles, and after a significant increase, the delivery volume only reached the lowest line of the guidelines. At the same time, the company's management had expected to achieve monthly sales of 20000 yuan in the fourth quarter after the replacement of 8 models, but there is still a significant difference between reality and the target.
Li Bin admitted that although NIO holds a 45% market share in the high-end pure electric vehicle market with a price of over 300000 yuan, Volkswagen is more concerned about the car market with a price range of 100000 to 200000 yuan, making it difficult to persuade them to purchase high-end models with a price range of over 300000 yuan.
The growth in sales has driven up the revenue of car sales, but at the same time, it has also raised the cost of car sales. The financial report shows that the sales cost of NIO Automobile in the third quarter reached 15.491 billion yuan, a year-on-year increase of 55.25%, exceeding the revenue by 6.36 percentage points, resulting in no improvement in the gross profit margin of automobiles. The gross profit margin of automobiles in the third quarter was 11%, a year-on-year decrease of 5.4 percentage points.
Li Bin stated that due to changes in the product portfolio in the third quarter, the gross profit margin has declined year-on-year. However, the company's management also stated that with the improvement of production efficiency, the decrease in lithium carbonate prices, and the reduction in parts costs, NIO is confident in achieving a gross profit margin of 15% in the fourth quarter, while the future target for the gross profit margin of the entire vehicle is still above 20%.
Affected by the gross profit margin of automobiles, NIO's overall gross profit margin in the third quarter was only 8%, a year-on-year decrease of 5.3 percentage points.
Financing transfusion
There was also a net loss that could not be improved. NIO suffered a loss of 4.557 billion yuan in the third quarter, an increase of 10.8% year-on-year, which is related to its high sales, general and administrative expenses.
In the financial report, NIO's sales and general administrative expenses in the third quarter reached 3.609 billion yuan, a year-on-year increase of 33.1%. Li Bin explained that this was due to the increase in personnel costs in the sales function and the increase in sales and marketing activities. "Currently, there are about 5700 frontline sales personnel, and nearly 3300 are new hires.". He admitted that the company has also provided a portion of severance pay for dismissing employees.
Meanwhile, it was revealed in August that the monthly revenue of some of NIO's frontline sales has exceeded 100000 yuan, and the skyrocketing salary expenses have also become one of the reasons for NIO's cost increase. It is revealed that the commission for a single NIO car is between 2000 and 5000 yuan, with a commission of 5000 yuan for a specific model of existing cars. However, the salesperson once told the International Financial News that only a small number of people earn a monthly salary of over 100000 yuan, "after all, not everyone can sell more than ten cars per month.".
The R&D expenses contrast with sales and general administrative expenses. In the financial report, NIO's R&D expenses in the third quarter decreased by about 300 million yuan month on month, with a year-on-year increase of less than 100 million yuan. The management explained this in a conference call, "We have received some support from local governments, so the R&D investment in the financial report has decreased. However, in the long run, the company's quarterly R&D investment will be maintained at 3 billion to 3.5 billion yuan.".
As of the end of the third quarter, NIO's total cash and cash equivalents, restricted funds, short-term investments, and long-term fixed deposits on its books amounted to RMB 45.2 billion, which may be related to multiple financing activities in the third quarter.
In July, NIO announced the completion of a strategic equity investment of $738.5 million from Abu Dhabi investment firm CYVN. In less than two months, NIO announced its intention to issue convertible senior bonds with a total principal amount of $500 million due in 2029 and $500 million due in 2030, totaling $1 billion.
The rare financing frequency and a high amount of $1.738 billion have once again pulled NIO back from the "life and death line".
Can't you survive?
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