NIO Inc.’s (NYSE: NIO) shares gained over 4% in morning hours on Friday after dropping around 7% in premarket hours. The stock had gained 52% over the past one month and 133% over the past three months. The company reported better-than-expected results for its most recent quarter.
Revenues rose 25% year-over-year to $257 million while adjusted loss per ADS amounted to $0.33. Vehicle sales increased 21.5% while total deliveries were 4,799. Total deliveries were up 35% from the second quarter of 2019. Deliveries in the second quarter were impacted by battery recalls that led to a reduction from the first quarter.
On its earnings conference call, Nio said the auto industry is experiencing softness and EV sales, in particular, dropped over 35% year-on-year during the second-half of 2019 due to the reduction in EV subsidies.
Nio continues to invest in its power swap technology, which allows users to upgrade the battery and allows the company to offer Battery as a Service. The company is optimistic about the growth potential of this system.
The company has been undertaking several cost reduction efforts which helped reduce SG&A expenses by 18% and R&D expenses by 21%.
For the fourth quarter of 2019, Nio expects total revenues to be approx. $393.2 million, up approx. 53% from the third quarter. Total vehicle deliveries are expected to be over 8,000 units, up over 66.7% from the third quarter.
Snap-on Incorporated (NYSE: SNA), the century-old company that makes high-end tools for the automotive industry, is unlikely to have a smooth ride in the current quarter, given the deepening turmoil
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