China smart electric vehicle maker Nio Inc. shares are expected to open on the Nasdaq Wednesday about 1% lower following the release of its third quarter earnings
Nio's shares traded up 2.17% Tuesday to close at $46.59 after the company reported a narrowing in its third quarter loss. Analysts said the stock's current valuation may explain the subdued reaction to the narrowing of its loss and increase in revenues.
For its latest quarter the company said it incurred a loss of $154.2 million, or 14 cents per American depositary receipt. That figure is nearly half the $390 million loss reported over the same period last year. Excluding nonrecurring items, the company's net loss for the period was $147 million.
Nio reported an increase in revenues for the period at $666.6 million. This was a 146% year-on-year increase.
The rise in revenues coincided with the increase in vehicle deliveries for the quarter which Nio said were 12,206 units. Most of the vehicles delivered were the company's new ES6 models, at 8,660 units. Nio is planning to increase deliveries by expanding production capacity.
"In view of the growing market demand for our competitive products, we are motivated to continuously elevate the production capacity to the next level. We expect to deliver 16,500 to 17,000 vehicles in the coming fourth quarter," Nio's chief executive officer William Bin Li said in a statement.
In its guidance for the current quarter, Nio said it expected revenues to grow from $921.8 million to $947.9 million. Its fourth quarter forecast is a 125% year-on-year growth.
Nio's ownership programs have attracted investors to its stock. The company's capital market growth has outpaced many of its rivals - including large motor-vehicle makers like General Motors. Year-to-date, the company's stock price has risen more than 12 times through Tuesday.