Nomura analysts said Nio‘s guidance for its first quarterly operating profit announced on Thursday exceeded expectations, with revenue in the fourth quarter likely to surpass 35.5 billion yuan — equivalent to $5.1 billion.
If the Shanghai-based EV maker posts revenue above 35.5 billion yuan as the bank expects, it would represent a new quarterly record and a 63% increase from the 21.79 billion yuan reported in the third quarter of 2025.
The figure would also exceed Nio‘s own fourth-quarter guidance of 32.76 billion yuan to 34.04 billion yuan, which the company provided in November alongside its third-quarter results.
Last September, Nomura raised its price target on Nio by 68% to $8.40 from $5 following the company’s annual event, where it officially launched the third-generation ES8.
The ES8 garnered more than 100,000 orders in its first days on sale, building a six-month backlog. The SUV is produced at Nio‘s third plant in Anhui province, which opened last year.
Concerns Overdone
The Japanese bank said concerns about the EV maker’s performance are “overdone.”
“We believe the latest market concerns around its performance are overdone,” Nomura analysts wrote in a note Friday.
Nio said Thursday it expects an adjusted profit from operations of 700 million yuan to 1.2 billion yuan ($100 million to $172 million) for the fourth quarter of 2025, compared with an adjusted operating loss of 5.5 billion yuan in the same period a year earlier.
“The expected adjusted profit from operations (non-GAAP) for the fourth quarter of 2025 was primarily attributable to (i) the Company’s sustained growth in sales volume in the fourth quarter of 2025; (ii) the optimization of vehicle margin driven by a favorable product mix; and (iii) the Company’s ongoing comprehensive cost reduction efforts and continued improvement in operational efficiency,” Nio Nio.
The company had previously guided only for non-GAAP breakeven in the quarter.
Shares gained 7% in Hong Kong to HK$39.10 on Friday, while US-listed shares closed 7.2% higher at $5.04.
Path to Profitability
Nio‘s sales and margins faced challenges in the first few quarters of 2025, Nomura said, but the company is on track to improve its business operationally and financially through better margins and tighter control on expenses.
Founder and CEO William Li said in early January that profitability “is achievable, as our current product gross margins are solid.”
Li said the company achieved its vehicle gross margin target of 17% to 18% in the fourth quarter, a goal he had outlined during the third-quarter earnings call.
Co-founder and President Lihong Qin reaffirmed in January that the third-generation ES8 SUV has a gross margin of 20%, with an average selling price exceeding 400,000 yuan — equivalent to $57,600.
“Everyone can do the math — how many units of other cars does the gross profit from a single ES8 roughly equal?” the co-founder and President said.
According to his figures, Nio generates 80,000 yuan ($11,500) in gross profit per ES8 sold.
Nio‘s third factory produced 43,668 units of the third-generation ES8 in 2025.
New Models
Nomura said new models Nio plans to launch this year, including the ES9 and Onvo L80 in the second quarter and the ES7 in the third quarter, could further strengthen the company’s market position and financial condition if they gain traction similar to the ES8 and Onvo L90.
Although the EV maker doesn’t reveal any pre-orders or firm orders figures, the delivery waiting time soared immediately after the ES8 was launched last September to 26 weeks — equivalent to six months.
The ES9 — set to become China’s largest SUV — is tentatively scheduled to be launched on April 10, two weeks before the Beijing Auto Show begins.
Citi analysts were more cautious, saying sales this year will remain a challenge given intensifying competition and cooling demand in China’s domestic market.
Nio deliveries reached a new record high of 48,135 vehicles in December, up 54.6% year over year.
Fourth-quarter deliveries totaled 124,807 vehicles, a 71.7% increase from a year earlier with about a third of them being the ES8 model.
