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Chinese Tesla rival Nio narrows losses as a revenue increase of 127%

Chinese Tesla rival Nio narrows losses as a revenue increase of 127%

August 13, 2021: -On Wednesday, Nio shares rose above 1% in after-hours trade after the Chinese electric carmaker posted a narrower than expected loss and an increase in revenue.

The start-up lost 0.42 yuan per share in the second quarter, less than the 0.68 yuan loss expected, according to Refinitiv data. That was a more narrow 1.15 yuan loss per share recorded in the same period in the present year.

Although revenue increased 127.2% year by year to hit 8.45 billion yuan, analysts had estimated over the 8.32 billion yuan.

Nio forecast revenues for the third quarter to be amid 8.91 billion yuan and 9.63 billion yuan, the surge of around 96.9% to 112.8% from the same quarter of the year 2020.

The electric carmaker said it is delivering 21,896 vehicles in the second quarter, within its stated range. For the third quarter, Nio forecasts that it will provide between 23,000 and 25,000 cars.

Nio and other electric carmakers face headwinds due to the global chip shortage, weighing on production. In China, a resurgence of the coronavirus could potentially affect sales.

“The issue for Nio, for Tesla, every car that they’re making, they’re selling. It’s production and chip shortage, and that’s going to be an overhang on the overall EV space,” Daniel Ives, managing director at Wedbush Securities, told CNBC on Thursday.

In a statement, William Bin Li, CEO of Nio, said that the global supply chain “still faces uncertainties.” He said that the company has been “working closely” with its partners to “improve the overall supply chain production capacity,” he said.

It faces increased competition from other electric vehicle start-ups in China, including Li Auto, Xpeng, and incumbent Tesla.

U.S.-listed Nio said it delivered 7,931 vehicles in July, lesser than the Li Auto and Nio.

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