Nio reported 98% year-over-year delivery growth and improved margins, yet its stock declined amid broader China auto market weakness.
Nio (NIO) shares fell 12.4% in May despite strong execution, including a 98% year-over-year surge in Q1 deliveries to 83,465 units. Vehicle sales more than doubled to $3.3 billion, while gross margin expanded to 19% from 7.6%, driven by higher average selling prices. The company also launched its mass-market Onvo brand and began immediate deliveries, reinforcing its market position.
The decline contrasts with Nio’s operational gains, as China’s auto market saw its eighth consecutive monthly sales drop in May. Nio’s ultra-premium ES8 remained the top-selling vehicle in China for models priced above RMB 400,000, highlighting its brand strength. Analysts had expected a net loss of $0.03 per share, which the company met, but broader sector headwinds weighed on sentiment.
Despite solid fundamentals, Nio’s stock movement reflects investor concerns over China’s slowing auto demand and macroeconomic pressures. The company’s aggressive expansion and margin improvements were overshadowed by external market conditions.