Li Bin battles on the profitability line
In the just - concluded third quarter, NIO achieved remarkable sales figures. In the third quarter, NIO delivered 87,071 vehicles, a year - on - year increase of 40.8%. In September alone, the delivery volume reached 34,749 vehicles, setting a new historical high.
However, compared with the target set by Li Bin, the founder, chairman, and CEO of NIO, for the fourth quarter, NIO needs to work harder. To achieve a single - quarter profit in the fourth quarter, NIO has set a lofty delivery target of 150,000 vehicles in the fourth quarter, which is 1.7 times higher than the actual delivery volume in the third quarter.
Li Bin stated that the company's task in the fourth quarter is to focus on selling cars. Therefore, the 2025 NIO Day was advanced from the usual end - of - year date to September 20th. In the eyes of the outside world, the change in the rhythm of market activities also helps NIO control its year - end sales expenses, making it easier to achieve the fourth - quarter profit target.
On September 20th at NIO Day, NIO launched the third - generation ES8. As the market expected, NIO continued its price offensive, and the new - version models significantly cut prices to boost sales. The starting price of the third - generation ES8 is 406,800 yuan, 10,000 yuan lower than the pre - sale price and nearly 100,000 yuan lower than the previous - generation ES8. If purchased under the battery - body separation and battery rental plan, the starting price of the product further drops to 298,800 yuan. Li Bin said in an interview that technological advancements in the past two years and the mass production of R & D results have reduced product costs. Therefore, even though the third - generation ES8 has a lower price, it has better gross profit performance than the second - generation ES8. "This is also the result of technological innovation, including some of our scale advantages."
Li Bin has high hopes for the new ES8. At the NIO Day event, Li Bin said that he hopes this model can achieve the target of delivering 40,000 vehicles within 2025.
With only a short time left in 2025, what changes are there within NIO? Where does NIO's confidence in striving for a fourth - quarter profit come from?
What are the reasons for the continuous losses?
From 2016 to the first half of 2025, NIO has suffered continuous losses for many years, with a cumulative net loss exceeding 100 billion yuan. From 2021 to 2024, the net loss increased year by year, reaching a high of 22.402 billion yuan in 2024.
Data source: Company financial reports. Data compilation and charting: Xu Zhuoran
What are the underlying reasons for NIO's continuous losses?
Low and volatile gross profit margin
From 2016 to 2025, NIO's gross profit margin fluctuated significantly. In 2019, the gross profit margin reached its lowest point at - 15.3%, and in 2021, it reached its highest at 18.9%. In 2023, the gross profit margin dropped to 5.5% again.
Data source: Company financial reports. Data compilation: Li Yueran. Charting: Ren Yafei
One of the factors affecting the gross profit margin is the selling price.
Data source: Company financial reports. Data compilation: Xu Zhuoran. Charting: Ren Yafei
NIO positions itself in the high - end market, and the starting price of its main models is above 400,000 yuan. However, with the launch of the LeDao and Firefly brands, as well as frequent car - purchase incentives, battery rental plans (BaaS), and price cuts, the average price per vehicle of NIO is on a downward trend. In 2019, the average price per NIO vehicle was about 351,700 yuan, and in 2024, it dropped to 262,400 yuan, a significant decrease of 25.39%. In the first half of 2025, the average price per NIO vehicle further declined to 228,400 yuan. This is mainly due to the change in the product structure, with an increasing proportion of low - price models from LeDao and Firefly, and the sales growth of NIO brand models was also less than ideal.
As the core component of new - energy vehicles, the battery accounts for about 40% - 50% of the total vehicle cost, and its price fluctuations also have a significant impact on the gross profit margin.
Data compilation: Xu Zhuoran. Charting: Ren Yafei
From 2021 to 2022, the prices of global raw materials such as lithium, cobalt, and nickel skyrocketed. The price of lithium carbonate soared from 45,600 yuan/ton in 2020 to 482,100 yuan/ton in 2022, directly driving up the cost of battery packs. As a result, the cost per NIO vehicle increased from 303,100 yuan in 2020 to 320,600 yuan in 2022, an increase of about 17,500 yuan. After 2023, although the price of lithium carbonate plummeted, the decline in the cost per NIO vehicle was less than the decline in the average price per vehicle. From 2022 to H1 2025, the cost per NIO vehicle decreased by about 115,600 yuan, while the average price per vehicle decreased by about 143,100 yuan.
In addition, heavy - asset investments such as battery swapping stations have led to an increase in depreciation expenses, which also affects the gross profit margin to some extent.
As of September 20, 2025, the number of NIO's global battery swapping stations reached 3,500. Battery swapping stations require heavy - asset investments and continuous operation and maintenance costs. At the pre - sale launch event of the LeDao L90, Li Bin revealed that NIO has cumulatively invested more than 18 billion yuan in the charging and battery - swapping field over the past 10 years.
Data source: Company financial reports. Data compilation: Xu Zhuoran. Charting: Ren Yafei
According to the annual report, the total fixed assets of NIO have been increasing year by year, and the depreciation expenses have also risen accordingly. From 2019 to 2024, the depreciation expenses increased from 993 million yuan to 5.87 billion yuan, a cumulative increase of 491.14%. From 2019 to 2024, the cumulative depreciation expenses exceeded 15.8 billion yuan, accounting for 7.6% of sales revenue. The long - term depreciation expenses resulting from heavy - asset investments will continuously affect profits. Moreover, since depreciation expenses are fixed costs, if NIO's sales volume fluctuates in the future, the depreciation expenses will further erode profits.
High selling, general, and administrative expenses
The financial reports show that NIO's selling and administrative expenses have been continuously rising from 2018 to 2024, increasing from 5.342 billion yuan to 15.741 billion yuan, a cumulative increase of 194.66%, showing a characteristic of rapid and rigid growth.
Data source: Company financial reports. Data compilation: Xu Zhuoran. Charting: Ren Yafei
Moreover, the proportion of NIO's selling and administrative expenses to revenue has long been higher than 20% (except in 2021) and has been continuously rising, increasing from 19.0% in 2021 to 23.95% in 2024, and further rising to 32.08% in H1 2025. In contrast, from 2021 to 2024, the selling - period expense ratio of Li Auto decreased from 25.3% to 7.8%; that of XPeng Motors decreased from 16.3% to 13.3%; and the selling - period expense ratio of Leapmotor was relatively high, being 49.3%, 26.3%, 26.4%, and 18.2% from 2021 to 2024 respectively.
High interest expenses
From 2016 to Q2 2025, NIO's interest expenses went through two stages of increase.
Data source: Company financial reports. Data compilation: Xu Zhuoran. Charting: Ren Yafei
In the first stage, when the company was in its start - up phase, the expansion of the debt scale led to a rapid increase in interest expenses. NIO's interest expenses increased significantly from 18 million yuan in 2017 to 637 million yuan in 2021. However, during this stage, the proportion of interest expenses to operating income showed a downward trend, indicating that the debt leverage stimulated sales growth and had a positive impact.
In the second stage, as the dividends of the new - energy market gradually faded, NIO's interest expenses rose to a peak of 798 million yuan in 2024, and the proportion of interest expenses to operating income increased year by year, surging from 0.68% in 2022 to 1.76% in H1 2025, reflecting a decrease in the efficiency of leveraged operations.
In addition, it is worth noting that as of June 30th, NIO's current liabilities reached as high as 62.282 billion yuan, 9.774 billion yuan higher than its current assets. Among NIO's current liabilities, the largest item is the accounts payable to suppliers, and its accounts payable and notes payable are approaching 35 billion yuan, while its cash reserve is only 27.2 billion yuan.
However, part of the reason for the increase in supplier arrears is that NIO actively increased its inventory this year to ensure deliveries.
Data source: Company financial reports. Data compilation and charting: Li Yueran
The financial reports show that NIO's inventory in the first half of this year was 16.939 billion yuan, a significant year - on - year increase of 52.7%. In the second quarter, the inventory was 8.243 billion yuan, a year - on - year increase of 68.7%.
At the media communication meeting on September 3rd, Li Bin said that in terms of production capacity this year, the main change is to adapt to the changes in intelligent electric vehicles. "For example, after the launch of the ES8 and L90, we held meetings with suppliers in the middle of the night. Immediately after the product launch, based on the pre - order situation, we checked which items needed to increase procurement and which needed to be stocked in advance. I also had intensive one - on - one exchanges with many supply - chain bosses recently to ask for their support." Li Bin said.
On September 17th, NIO announced the completion of an equity - issuance financing of 1.16 billion US dollars. On September 10th, NIO announced the completion of an equity - issuance financing of 1 billion US dollars. With the total financing of 2.16 billion US dollars (equivalent to 15.378 billion yuan) obtained by NIO within a week, NIO's cash reserve can cover the scale of accounts payable.
Data source: Company financial reports. Data compilation: Xu Zhuoran. Charting: Ren Yafei
The financial reports show that NIO's asset - liability ratio doubled from 41.69% in 2020 to 93.39% in Q2 2025, exceeding the industry's debt - repayment risk threshold. At the same time, the interest - bearing debt has almost always remained above 20%, bringing significant pressure on the