At first glance, 2025 looked like it might be Nio’s year. Chinese stocks were flying, Trump’s new tariffs had some investors eyeing China as a potential alternative, and Nio kicked things off with a 40% jump in Q1 vehicle deliveries. Not bad, right?
2024 Was Also Promising in the Beginning
Then came Q4 2024 earnings, which continued the trend of previous quarters; it’s losing money. Despite all that delivery hype, Nio’s stock has dropped over 22% year-to-date. It turns out that selling more cars doesn’t help much when you lose almost a billion dollars. In Q1 2024 alone, Nio reported a net loss of $977 million, which was 24% more red ink than last year. For 2024 as a whole, the loss slid toward $3.1 billion.
So, while the company grows, its bottom line falls through the floor.
To be fair, Nio’s trying. Management says they’ll double deliveries by 2025 (from 222,000 to 444,000), and they’re betting on two new sub-brands — ONVO and Firefly — to help scale up. China’s EV market is booming, and Nio’s battery swap tech still gives it an edge. Plus, its “Battery-as-a-Service” model lets customers rent batteries instead of owning them — a neat idea if you’re into flexible charging options.
Good Ideas Don’t Pay the Bills
To keep things going, Nio recently announced it’s issuing about 118.8 million new shares — diluting shareholders by 5% to raise $520 million. This came just a few months after it claimed it had plenty of cash and didn’t need more funding.
Even with that raise, the company still had only around $5.7 billion in cash, and with losses piling up, that runway may not last as long as investors want.
If you’re wondering whether this dip is a buying opportunity, consider this: using a five-year reverse DCF model, factoring in an 11% revenue growth rate and a long road to positive margins, Nio’s fair value comes to about $2.25 per share. That’s more than 40% below where it’s trading now. Nio keeps talking a big game about breaking even by 2026 and maybe turning a profit by 2027, but so far, that roadmap feels more like a vague wishlist than an actual plan.
So yeah, Nio has potential. But right now, it’s like dating someone with a lot of ambition and no income. Maybe someday it’ll work out. But for now? You might want to wait until it gets its act together.
Is NIO a Buy, Sell, or Hold?
Based on 11 ratings, NIO is considered a Hold. The average price target is $4.93, representing a 46.73% upside potential.
