NIO, China's leading EV startup, reported bigger-than-expected losses in the fourth quarter in 2019, according to unaudited financial results announced today.

In the fourth quarter of 2019, its revenue was 2.85 billion yuan higher than market expectations of 2.838 billion yuan but lower than the 3.436 billion yuan in the same period last year.

Adjusted loss per share was 2.73 yuan, bigger than the estimated 1.88 yuan.

Nio expects revenue in the first quarter to be between RMB 1.21 billion and RMB 1.27 billion, and the market expectation is RMB 2.48 billion.

The number of deliveries in the fourth quarter was 8,224, and 3,400-3,600 are expected to be delivered in the first quarter.

Nio CEO Li Bin said that the cash balance is not enough to provide the working capital and working capital required for continuing operations in the next 12 months.

Nio shares went down by 23% in pre-market trading on Wednesday.

Highlights for the Fourth Quarter of 2019:

Vehicle sales were RMB2,683.9 million (US$385.5 million) in the fourth quarter of 2019, representing an increase of 54.8% from the third quarter of 2019 and a decrease of 20.6% from the same quarter of 2018.

Vehicle margin was negative 6.0%, compared with negative 6.8% in the third quarter of 2019 and 3.7% in the same quarter of 2018.

Total revenues were RMB2,848.3 million (US$409.1 million) in the fourth quarter of 2019, representing an increase of 55.1% from the third quarter of 2019 and a decrease of 17.1% from the same quarter of 2018.

Gross margin was negative 8.9%, compared with negative 12.1% in the third quarter of 2019 and 0.4% in the same quarter of 2018.

Loss from operations was RMB2,826.2 million (US$406.0 million) in the fourth quarter of 2019, representing an increase of 17.3% from the third quarter of 2019 and a decrease of 18.0% from the same quarter of 2018. Excluding share-based compensation expenses, adjusted loss from operations (non-GAAP) was RMB2,774.9 million (US$398.6 million) in the fourth quarter of 2019, representing an increase of 18.6% from the third quarter of 2019 and a decrease of 16.0% from the same quarter of 2018.

Net loss was RMB2,864.6 million (US$411.5 million) in the fourth quarter of 2019, representing an increase of 13.6% from the third quarter of 2019 and a decrease of 18.2% from the same quarter of 2018. Excluding share-based compensation expenses, adjusted net loss (non-GAAP) was RMB 2,813.4 million (US$404.1 million) in the fourth quarter of 2019, representing an increase of 14.8% from the third quarter of 2019 and a decrease of 16.3% from the same quarter of 2018.

Net loss attributable to NIO's ordinary shareholders was RMB2,893.8 million (US$415.7 million) in the fourth quarter of 2019, representing an increase of 13.3% from the third quarter of 2019 and a decrease of 17.7% from the same quarter of 2018. Excluding share-based compensation expenses and accretion on redeemable non-controlling interests to redemption value, adjusted net loss attributable to NIO's ordinary shareholders (non-GAAP) was RMB2,810.7 million (US$403.7 million).

Basic and diluted net loss per American Depositary Share (ADS)iv were both RMB2.81 (US$0.40) in the fourth quarter of 2019. Excluding share-based compensation expenses and accretion on redeemable non-controlling interests to redemption value, adjusted basic and diluted net loss per ADS (non-GAAP) were both RMB2.73 (US$0.39).

Cash and cash equivalents, restricted cash and short-term investment were RMB1,056.3 million (US$151.7 million) as of December 31, 2019.

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