NIO is closer to profitability than ever.

On November 25th, it was NIO's 11th birthday. On this day, NIO released its best quarterly financial report in history.

In the third quarter of this year, the revenue reached a record high - 21.794 billion yuan. The comprehensive gross profit margin and the gross profit margin of the whole vehicle also reached a new high in the past three years. The "surplus funds" are also increasing. The cash reserve increased by nearly 10 billion yuan in a single quarter, reaching 36.7 billion yuan.

Although the amount of loss is still considerable, both the year-on-year and quarter-on-quarter losses decreased by more than 30%. After Q3, NIO is closer to profitability than ever.

At the earnings conference, Li Bin mentioned again that "he is confident that NIO will achieve profitability in the fourth quarter". Moreover, NIO has many orders for the new ES8. The potential of this high-gross-margin model has been rising. Although the relatively low-priced models have been affected by the reduction of replacement subsidies, the impact on the company's overall gross profit is within the expected range.

With the core data showing an upward trend, regardless of whether NIO will be profitable in the fourth quarter, its current achievements are worthy of recognition.

01 "The trend is on NIO's side"

Profitability, profitability, and still profitability.

As NIO is approaching the time to fulfill its promise, when Li Bin answered the first question at the earnings conference, he made his stance clear -

We are still confident that we can achieve profitability in the fourth quarter.

He said that the delivery of NIO's new ES8 will soar in the fourth quarter, and finally the gross profit margin of a single ES8 model will exceed 20%.

Qu Yu, NIO's Chief Financial Officer, said that the improvement of NIO's gross profit in the third quarter was due to two reasons. Firstly, the increase in sales volume led to cost reduction in the supply chain. Secondly, models such as the LeDao L90 also started to be delivered.

Specifically, the gross profit margin of NIO's new ES8 is 20%. The gross profit margin of the 66 models (NIO ES6, EC6) exceeded 25% in the third quarter. The gross profit margin of the 55 models (NIO ET5, ET5T) is between 15% and 20%. The gross profit margin of the LeDao L90 is between 15% and 20%.

At the same time, the gross profit margin of NIO's non-vehicle business will also increase. In Q4, NIO's gross profit margin will increase significantly compared with Q3.

Li Bin also set NIO's business goal for next year as - full-year Non-GAAP profitability.

In addition to the already launched LeDao L90 and the new ES8, NIO will launch three large vehicles with high gross profit margins next year, including two in the second quarter and one in the third quarter. These five large vehicles will not only become the main sales force of NIO, but also we can make a judgment that NIO's sales focus will shift to large vehicles with higher gross profit margins in the future, so as to drive up the overall gross profit margin of the company's whole vehicle business.

Secondly, in terms of sales volume, in Li Bin's view, the trend is on NIO's side. In 2025, the penetration rate of pure electric vehicles in the high-end market and the large vehicle market is increasing rapidly. "Since this year, the perception of pure electric vehicles in the high-end market has gradually taken shape."

Li Bin provided a set of data. He said that in the third quarter of this year, the sales volume of pure electric vehicles increased by 26% year-on-year, while the sales volume of extended-range vehicles and plug-in hybrid vehicles decreased by 12% and 7% respectively.

If we look at the data of the first three quarters of this year, the sales volume of pure electric vehicles increased by 33% year-on-year, while that of extended-range vehicles only increased by 3%. If we look at the data of October, the sales volume of pure electric vehicles increased by 13% year-on-year, while that of extended-range vehicles decreased by 3%.

In the market above 300,000 yuan, the penetration rate of pure electric vehicles is also increasing rapidly. The penetration rate was only 12% last year, and it reached 18% in the third quarter of this year. Li Bin believes that there is also a lot of room for growth in the high-end pure electric vehicle market where the NIO brand is located.

Moreover, the proportion of large vehicle sales in the company's overall sales volume will remain at a relatively high level next year, which has a great chance of driving up the comprehensive gross profit margin. Combined with the continuous cost reduction in the supply chain and the continuous optimization of sales, R & D, and management expenses, the company's comprehensive gross profit margin is expected to reach 20% in 2026.

It should be noted that even though NIO's sales reached a new high in the third quarter, the single-quarter data of more than 80,000 vehicles actually fails to reflect the actual situation of NIO in the consumer market.

This is because in the third quarter, the two main sales models, the LeDao L90 and the NIO ES8, were in the period of just being launched and ramping up production capacity. And NIO's monthly sales exceeded 40,000 in October, and the sales volume in this month alone accounted for half of the whole quarter.

Although the monthly average sales volume guidance for the fourth quarter has been lowered, and the previous "monthly average of 50,000" figure has not been given, but it is stable at just over 40,000 units. Li Bin explained that this is because of the expectation of the reduction of purchase tax subsidies next year.

Li Bin admitted that the industry has been quite volatile recently. Some of NIO's models that have been in the long sales cycle, including the recently launched models, have been affected by factors such as purchase tax and replacement subsidies. However, he believes that the policy of reducing the purchase tax discount by half next year will have less impact on NIO because most of NIO's users lease the battery, and the battery is not included in the vehicle price.

The last item related to profitability is expenses.

NIO is really saving money. From the perspective of expenses, the selling, general and administrative expenses in Q3 were 4.1847 billion yuan, only increasing by 5.5% compared with the second quarter, but the sales volume increased by 20.8%. It is not difficult to see that NIO is achieving more with less.

Moreover, NIO's R & D expenses in the third quarter were 2.4 billion yuan, a year-on-year decrease of 28%. Qu Yu also said that NIO currently controls its R & D expenses at about 2 billion yuan per quarter. In other words, there is still room for the R & D expenses to decrease.

However, reducing R & D does not mean losing long-term competitiveness. Improving R & D efficiency is the key. Qu Yu said, "Every project we are working on now needs to be approved, and the intensity should be able to support the company's competitiveness."

Gross profit, sales volume, and expenses. These three dimensions form the basis for Li Bin's confidence in achieving profitability in the fourth quarter. Although it seems a bit unrealistic to turn a loss of more than 3 billion yuan in a quarter into a profit, judging from the performance in the third quarter, there is still hope.

02 Profitability without relying on financial means

Although NIO still had a loss of 3.4805 billion yuan, in the third quarter, NIO can truly be called the strongest NIO in history, and it deserves recognition from the market.

Let's take a look at the core data again.

NIO's revenue in the third quarter of 2025 was 21.7939 billion yuan, a year-on-year increase of 16.7% compared with the third quarter of 2024 and a quarter-on-quarter increase of 14.7% compared with the second quarter of 2025. It is also the first time that the single-quarter revenue has exceeded 20 billion yuan.

Among them, the automobile sales revenue was 19.2023 billion yuan, a year-on-year increase of 15.0% compared with the third quarter of 2024 and a quarter-on-quarter increase of 19.0% compared with the second quarter of 2025. The delivery volume was the absolute direct driving force for the revenue growth.

NIO delivered approximately 87,100 vehicles in the third quarter, a year-on-year increase of 40.8% and a quarter-on-quarter increase of 20.8%. Specifically, the NIO brand delivered approximately 36,900 vehicles, the LeDao brand delivered approximately 37,700 vehicles, and the Firefly brand delivered approximately 12,500 vehicles.

By simply calculating, dividing the automobile sales revenue of 19.2 billion yuan by 87,071 vehicles, we can roughly calculate that the average price of a single NIO vehicle is approximately 220,500 yuan, a slight quarter-on-quarter decrease of 34,000 yuan. The direct reason is the increase in the proportion of Firefly vehicle deliveries.

However, the delivery volume of the LeDao brand exceeded that of the NIO brand for the first time in the third quarter, becoming the brand with the highest delivery volume among the company's three brands. In particular, the delivery volume of the LeDao L90 reached 21,626 vehicles, accounting for nearly a quarter.

The increase in the proportion of high-gross-margin vehicle deliveries is also one of the key reasons for driving up NIO's gross profit margin. It drove up NIO's automobile gross profit margin by 1.6 percentage points year-on-year to 14.7% in the third quarter and increased it by 4.4 percentage points quarter-on-quarter. At the same time, the company's comprehensive gross profit margin reached 13.9%, a new high in the past three and a half years.

The loss has also narrowed. The net loss in the third quarter was 3.4805 billion yuan, narrowing by more than 30% both year-on-year and quarter-on-quarter. Excluding the share-based payment expenses and organizational optimization expenses, NIO's adjusted net loss (Non-GAAP) in the third quarter of 2025 was 2.7351 billion yuan, a year-on-year narrowing of 38.0% and a quarter-on-quarter narrowing of 33.7%.

We have to admit that the deficit is still large, but NIO's attitude towards achieving profitability is quite positive.

From the perspective of expenses, NIO's R & D expenses in the third quarter were 2.4 billion yuan, a year-on-year decrease of 28.0% and a quarter-on-quarter decrease of 20.5%. At the same time, the total of sales, administrative and general expenses was 4.2 billion yuan, only increasing by 100 million yuan compared with the same period last year, but in return, there was a year-on-year growth rate of more than 40%.

While the sales volume and revenue have increased significantly, and the selling, general and administrative expenses have only increased slightly, it is not difficult to see that NIO's strategy of implementing the Core Business Unit (CBU) is indeed very effective.

In order to save money, Li Bin also took action himself. In order to save the 30,000 yuan overtime pay for the evening rehearsal of the NIO booth and the LeDao booth at the Guangzhou Auto Show, Li Bin changed his flight ticket and flew to Guangzhou in advance. He even complained to the media, "30,000 yuan is also money."

Li Bin said at the earnings conference call that the company has achieved certain results in improving operating efficiency in Q3, and the operating efficiency will be further improved in Q4. Whether it is the vehicle business or the non-vehicle business, we can see a good operating result.

Finally, in terms of cash flow, as of September 30, 2025, NIO's cash and cash equivalents, restricted cash, short-term investments and long-term time deposits were 36.7 billion yuan, a significant increase of nearly 10 billion yuan compared with the previous quarter. This is mainly due to the private placement of 1.16 billion US dollars on September 17th.

In the decisive fourth quarter, NIO has set a more aggressive goal: the expected delivery volume will be between 120,000 and 125,000 vehicles, a year-on-year increase of 65.1% to 72.0%, setting a new record; the expected revenue will be between 32.76 billion yuan and 34.04 billion yuan, a year-on-year increase of 66.3% to 72.8%.

Actually, based on the fourth-quarter delivery and revenue guidance and the predictions of Li Bin and Qu Yu at the conference call, we can roughly infer whether NIO will achieve its profitability goal in the fourth quarter.

The predicted revenue in the fourth quarter is between 32.76 billion yuan and 34.04 billion yuan. Calculated at the minimum standard of 32.7 billion yuan, it is 11 billion yuan more than the revenue in the third quarter. Based on the current third-quarter gross profit margin of 14.7%, the net profit can increase by 1.617 billion yuan. And the adjusted loss is 2.7 billion yuan, so there is still a gap of 1 billion yuan.

Don't forget that the ES8 was not delivered in large quantities in the third quarter. The new ES8 deliveries in