The Star Daily reported on November 22 (Reporter Tang Zhixiao) that NIO released its earnings for the third quarter of 2024.

According to the report, NIO's revenue for the third quarter of 2024 was 18.67 billion yuan, a year-on-year decline of 2.1%; the gross margin increased by 2.1% to 13.1%.

Specifically regarding the business aspect, NIO's revenue from autos was 16.698 billion yuan, accounting for 89.4% of total revenue, a year-on-year decrease of 4.1%. The vehicle delivery volume for the third quarter of 2024 was 61,855 units, an increase of 11.6% year-on-year and 7.8% quarter-on-quarter. Among them, 61,023 units were from NIO, and 832 units were from the sub-brand Le Dao.

The earnings report data showed that as of September 30, NIO's third quarter free cash flow turned positive, and NIO's cash and cash equivalents, restricted cash, short-term investments, and long-term time deposits totaled 42.2 billion yuan. However, NIO's net loss was 4.4126 billion yuan, a year-on-year increase of 11.6% and a quarter-on-quarter decrease of 2.7%.

NIO founder, chairman, and CEO Li Bin stated at the earnings conference that "high R&D expenditures and the establishment of the 'battery swap services in every county' and Le Dao brand sales service system have put some pressure on us in the short term, but the company is confident in continuously narrowing losses and achieving full-year profitability by 2026."

R&D and marketing expenses continue to rise, pushing back the breakeven point by two years.

Benefiting from the overall high price of NIO models, the gross margin for NIO's vehicles in the third quarter continued to increase to 13.1%, but the net profit remains negative.

Among them, R&D expenses and selling, general and administrative expenses increased by 9.2% and 13.8% year-on-year, and also rose by 3.1% and 9.3% compared to the previous quarter. NIO's R&D team currently comprises approximately 11,000 people, maintaining R&D investment of around 3 billion yuan each quarter.

At the earnings conference, NIO's CFO Qu Yu stated that the increase in expenses is mainly due to the accelerated pace of new product development and the expenditures for the sales network and marketing preparation of the LeDao brand, which will continue to increase in the fourth quarter.

Currently, NIO has built 190 LeDao stores, but Li Bin believes that it is still insufficient in terms of regional coverage, especially compared to Tesla and Ideal's sales channels. "Our goal by the end of the year is still to reach 300 stores and achieve a sales target of 20,000 units in March."

Qu Yu added that the gross margin target for NIO in the fourth quarter remains at 15%, and next year a series of smart hardware iterations will be launched to enhance the overall supply chain, and these cost-reduction methods will also be applied to NIO's brand models next year. "Internally, we also have a 'mining' project, which will help us achieve cost reduction and efficiency increase. By 2025, the gross margin of the NIO brand is expected to rise to 20%."

Previously, on March 25, 2022, during NIO's 2021 financial report conference call, Li Bin announced: "NIO hopes to achieve profitability for the entire year in 2024." Now, this goal seems to have been postponed by two years to 2026.

Li Bin stated that next year NIO will enter a new product cycle, and the company is confident in achieving 100% sales growth next year. "From the overall perspective of the company, we still set 'achieving profitability for the entire year by 2026' as the operational goal."

A new brand will be launched next year to compete with Ideal's family SUVs, which has already been laid out.

During the third-quarter earnings conference call, Li Bin revealed that NIO will deliver the NIO ET9 model in the first half of 2025. This model will feature the new generation technology platform NT3.0, including a 900V high-voltage architecture and the first self-developed chip, the Shenji NX9031 smart driving chip, among other features.

Li Bin stated: "Existing models will be iterated based on the technology used in the ET9, and new models will be launched one after another next year, including this model for current vehicles. We expect to complete all product transitions and upgrades within two years."

Regarding whether the L60 from Lidao will form a direct competitive relationship with Nio models, Li Bin admitted: "Indeed, there will be a small portion of users who will choose between Nio and Lidao products, but from the data we currently have, this portion is very small, about only 20%."

At the 2024 Guangzhou Auto Show, Lidao President Ai Tiecheng stated: "Orders for the L60 far exceed expectations, with production orders already scheduled into the first quarter of next year. As of November 14, the total delivery volume of the L60 has surpassed 7,000 units, with a goal of breaking 10,000 units in single-month deliveries by December this year."

At the earnings conference, Li Bin stated that the ramp-up pace of the L60 is also within expectations. Due to subsidies, the current demand for Lidao is certainly not as hot as in September, but the test drive conversion rate is extremely high, far exceeding that of Nio cars, which indicates that Lidao's product competitiveness in the market is very strong. "In the home SUV market targeting families, Nio has also planned to develop large six-seater and seven-seater SUVs aimed at competing with the Ideal L8 and L7 models, as well as a large five-seater SUV. Next year, the company will complete the layout of the Lidao brand."

It is noteworthy that Nio's third brand, Firefly, has also made new progress. According to Li Bin, this brand will be officially launched on December 21 at NIO Day 2024, with the first model sharing the same name as the brand, and it will be unveiled on the same day, with deliveries to commence in the first half of 2025.

It is reported that the positioning of Firefly in Nio is equivalent to the MINI brand of the BMW Group, targeting the high-end small car market and will be displayed and sold in Nio stores.

Nio's delivery volume for the fourth quarter is expected to be between 0.072-0.075 million units, while Nio's total delivery volume in October was 0.021 million units. In other words, over the next two months, Nio needs to achieve more than 0.051 million units in deliveries. Based on the current delivery situation of the Lidao L60, this should not be difficult for Nio. Li Bin also stated in the earnings report, "The total delivery volume of Nio in the fourth quarter is expected to reach a new high."