NIO’s Stock (NYSE: NIO) Stumbling Into Earnings As Profitability Concerns Remain

NIO's stock price (NYSE: NIO) is stumbling into earnings at $3.50 per share, a concerning 13.28% dip over the last month of trading. This movement reflects continued investor unease surrounding the Chinese electric vehicle (EV) maker as it navigates an increasingly competitive landscape and prepares to release its first-quarter 2025 financial results on before tomorrow morning's opening bell.

The current price sits significantly below both the 50-day simple moving average (SMA) of $3.88 and the 200-day SMA of $4.57, signalling a potential downtrend and raising concerns among technical analysts.

Investor focus now sharply turns to the upcoming earnings release. Analysts are projecting an earnings per share (EPS) of -$2.66 USD (RMB -$0.26) for the current quarter and an annual EPS of -$11.39 USD (RMB -$1.13) for fiscal year 2025.

Revenue for the period is expected to have grown steadily on the same period last year, up 25.74% at $1.73 billion (RMB 12.46B).

These figures highlight the ongoing struggle for profitability as NIO continues to invest heavily in research and development, new model launches, and expanding its charging infrastructure.

Analysts keep a positive stance on NYSE: NIO with Mizuho raising the firm's price target from $3.50 to $4.00 in recent weeks (05/16). The firm also keeps a “Neutral” rating on the shares. The average price target for NIO is $5.14 which shows that the stock has perceived upside scope.

🟩 The Bull Case for NYSE: NIO

• Strategic brand diversification with Onvo and Firefly targeting broader market segments.
• Technological innovation showcased in the ET9, solidifying NIO's position in the luxury EV market.
• Potential for significant growth in the Chinese EV market, despite current competitive pressures.
• Expansion of charging infrastructure enhancing user experience and brand loyalty.

🟥 The Bear Case for NYSE: NIO

• Intense price war in China eroding profit margins.
• Disappointing Q1 2025 delivery numbers raising concerns about demand.
• Ongoing losses and uncertainty regarding the timeline for achieving profitability.
• Competition from established automakers and other emerging EV brands.

Recent delivery numbers paint a mixed picture. While the 42,094 vehicles delivered in the first quarter of 2025 align with the company's guidance, this figure represents a significant 42.09% decrease from the 72,689 vehicles delivered in the fourth quarter of 2024. Although there was a 40.07% increase year-over-year from the 30,053 vehicles delivered in the same quarter of the previous year, the sequential decline raises questions about demand and the impact of seasonality. A closer look reveals that the main NIO brand delivered 27,313 vehicles in Q1 2025 a 9.12% decrease year-over-year and a substantial 48.23% decrease quarter-over-quarter, indicating potential challenges with the core product line's performance.

Adding to the pressure, the Chinese automotive market is currently embroiled in an intense price war, triggered by BYD's recent announcement of new incentives on over 20 models. This aggressive pricing strategy has sent ripples through the industry, impacting the stock prices of various Chinese automakers, including NIO. Investors are worried about the sustainability of the current market dynamics and the potential erosion of profit margins for all players.

NIO's management is attempting to counter these challenges through strategic brand diversification. The launch of the Onvo brand, targeting the mass-market segment with the Onvo L60 deliveries beginning in September 2024, and the Firefly brand, focusing on electric small cars for the European market launched in early 2025, are aimed at broadening the company's appeal and capturing a larger market share. Furthermore, the introduction of the ET9, a full-size luxury electric sedan featuring advanced technologies like a 900V electrical architecture and an active suspension system, demonstrates NIO's commitment to innovation and its ambition to compete in the high-end EV market. Deliveries of the ET9 began in March 2025.

However, the success of these initiatives remains uncertain. The new brands require significant investment in marketing and distribution, and their acceptance by consumers is not guaranteed. The ET9, while technologically advanced, faces stiff competition from established luxury automakers and other emerging EV brands.