NIO Q4 FY2021 Earnings Preview: Key Insights and What to Expect

Focus on NIO's Vehicle Delivery Performance

Essential Highlights

• Analysts predict an adjusted EPS of -0.57 yuan (-$0.09), improving from -1.05 yuan in Q4 FY2020.
• NIO’s vehicle deliveries, already disclosed, show strong year-over-year growth.
• Revenue is projected to increase steadily, though growth momentum is easing.

NIO Inc. continues to register rapid expansion in electric vehicle sales, helping the company reduce losses despite persistent supply chain hurdles. However, the pace of growth has moderated in recent quarters, reflecting a broader deceleration across China's automotive market amid economic headwinds.

Investors will closely examine how these macroeconomic factors influence NIO’s financial outcomes when the company releases its Q4 FY2021 earnings on March 24, 2022. Forecasts anticipate a significant reduction in losses per share compared to the same quarter last year, with revenue growth expected to remain positive but slower than previous quarters. Note that references to NIO shares denote the NYSE-listed American Depositary Shares (ADS) trading under the ticker NIO.

Automobile delivery figures are also a focal point for investors. NIO announced its Q4 vehicle deliveries in early January, surpassing analyst expectations. Yet, the growth rate decelerated noticeably compared to earlier quarters.

Over the past year, NIO shares have notably underperformed the broader market. After a brief period of outperformance between late June and early July 2021, the stock has experienced volatility and a sustained decline, resulting in a total return of -49.3%, significantly lagging the S&P 500’s 14.5% gain.

On March 9, 2022, NIO successfully listed its Class A ordinary shares on the Hong Kong Stock Exchange’s main board under stock code "9866," fully fungible with its NYSE ADSs.

NIO’s Earnings Performance Overview

In Q3 FY2021, NIO delivered mixed financial results, with a loss per share exceeding analyst forecasts. Revenue, however, grew by 116.7% year-over-year, although at a slower rate than in prior quarters. Despite ongoing supply chain volatility, the company emphasized its collaboration with partners to secure production for Q4.

During Q2 FY2021, NIO surpassed consensus estimates, reporting its smallest loss per share in over two years and a 127.2% revenue increase year-over-year. This robust growth, however, marked a sharp slowdown from the extraordinary 481.8% increase in the previous quarter. Supply chain uncertainties persisted, but efforts to enhance production capacity remained a priority.

Analysts forecast that NIO will continue to narrow its losses per share compared to both the prior year and previous quarter. Revenue growth is expected at 46.8% year-over-year—the slowest since a revenue decline in Q1 FY2020. For the full fiscal year 2021, losses per share are anticipated to widen slightly but remain the second smallest in five years, with annual revenue growth projected at 119.1%, the fastest pace in recent years.

Sources: Visible Alpha and NIO Inc.

Critical Performance Indicator: Vehicle Deliveries

Vehicle deliveries remain a vital metric for gauging NIO’s market demand and production scalability. While the company generates revenue from various products and services, the majority stems from sales of its electric vehicles: the ES8 flagship six- or seven-seater smart electric SUV, the ES6 five-seater high-performance smart electric SUV, and the EC6 five-seater electric coupe SUV. Production and delivery have faced challenges due to the global chip shortage and supply chain constraints, although chip availability in China is gradually improving.

NIO’s vehicle sales have surged impressively over recent years. In FY2018, sales totaled 11,350 units, increasing 81.2% by FY2019. Growth accelerated to 112.6% in FY2020 with approximately 43,730 vehicles delivered. This momentum continued into Q1 FY2021 with a remarkable 422.7% year-over-year increase, followed by slower but still robust growth rates of 111.9% in Q2 and 100.2% in Q3 FY2021. In Q4, growth decelerated further to 43.7% year-over-year. For the full FY2021, vehicle deliveries rose 109.1% to 91,429 units.

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