- Nio reversed its early-morning losses and jumped as much as 6% on Friday after its record first-quarter earnings was overwhelmed by chip supply shortages.
- Nio saw its first-quarter revenue grow 481% to $1.2 billion, handily beating analyst estimates.
- “The supply chain is still facing significant challenges due to the semiconductor shortage,” Nio’s CEO said.
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Nio initially fell as much as 4% in Friday trades after its first-quarter earnings beat was overshadowed by the potential slowdown in car production due to a lack of semiconductor supply. But those losses were ultimately reversed, with investors brushing aside chip supply concerns and bidding shares of Nio higher by as much as 6%.
“The overall demand for our products continues to be quite strong, but the supply chain is still facing significant challenges due to the semiconductor shortage,” Nio CEO William Li said.
Nio was already forced to lower its delivery guidance and temporarily halt production last month due to the lack of supply of semiconductors.
The supply shortage has been top of mind for investors this past week, with Apple CEO Tim Cook telling investors it was forced to delay iMac and iPad production and Tesla CEO Elon Musk telling investors the electric vehicle maker has had “insane difficulties” with its supply chain over the last quarter. Ford also said it expects a significant hit to production due to the supply shortage.
First-quarter revenue for Nio hit a record $1.2 billion, handily beating analyst estimates by $160 million and representing year-over-year growth of 481% as demand for electric vehicles in China soars. The company delivered 20,060 vehicles in the quarter, representing a 423% increase year-over-year and a sequential increase of 16%.
The China-based EV manufacturer expects to deliver 21,000-22,000 vehicles in the second quarter, representing year-over-year growth of more than 100%.
Nio isn’t the only car company experiencing a surge in demand from Chinese consumers. Tesla CEO Elon Musk believes China will represent the company’s biggest market in the future, as it continues to scale production in the country.