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NIO 21Q4 Earnings Highlights
Strong growth of revenue with new EV models rolling off the production line
All you need to know about this earnings season
Key Takeaways:
Attitudes: 2021 was a challenging year for NIO and the global auto industry. By overcoming the pandemic, semiconductor shortages and supply chain volatilities, NIO has continued to lead the premium electric vehicle market in China. The whole industry is confronted with cost increases and delivery difficulties but NIO has accumulated rich experience in securing these areas. The listing in Hong Kong marks another milestone for NIO and enables NIO to serve more investors in the future.
Guidance: 2022 is a year for NIO to go ahead at full speed. NIO expects total delivery of Q1 2022 to be between 25,000 to 26,000 vehicles. The Company also expects the revenue of Q1 2022 to be between $1.51 billion and $1.57 billion with an increase of 20.6% to 25.1% YoY. In 2022, NIO plans to deliver 3 new products based on NT2. Over full year vehicle gross margin will target to reach around 18% to 20%. In the coming years, NIO will continue to elevate both R&D investment and efforts in core technologies such as the full-stack autonomous driving and battery technologies.
Products: NIO adjusted the production lines for the delivery of ET7 in late March 2022. The product itself has led the industry in the autonomous driving. The test drive to order conversion rate exceeds NIO's expectations which shows the competitiveness of NT2. Soon NIO will also launch ES7 as the first SUV model on NT2 positioned as a mid-large premium five-seaters SUV and expected to start delivery from the Q3 2022. ET5, a mid-size smart electric sedan, has attracted diversified user base. The delivery of ET5 is expected to start in September 2022.
Investment: The overall non-GAAP R&D expenses exceeded $0.64 billion in 2021. Regards to production capacity, the production line upgrade at the JAC-NIO manufacturing center is in progress. By mid-year, the production cadence will reach 60 jobs per hour. In 2022, NIO plan to open more than 100 new sales outlets and 50 new service centers. Besides, NIO will operate over 1300 battery swap stations and 6000 power chargers in 2022. The team building and market entry are moving forward and NIO will enter the markets of Germany, the Netherlands, Sweden and Denmark in 2022.
Q: Should NIO consider any MSRP (manufacturer's suggested retail price) hike in the near term to offset potential battery and aluminum cost hike?
William Li: For the existing ES8, ES6 and EC6 we believe we don't need to adjust the pricing at this moment. But based on the smart hardware upgrade of the existing products and also we are going to launch some new models, then at that time we believe probably we can re-evaluate our pricing strategy based on the cost increase in the supply chain.
Q: For the lithium spot price in China, do you think it has already peaked due to the recent government intervention?
William Li: Regarding the lithium carbonate cost increase, we have done very in-depth research regarding the overall industry chain especially the upstream. We believe the cost increase is mainly due to the opportunistic price hike and there is no specific big gaps in terms of the demand and the supply of the lithium carbonate materials.
Right now, we can see some Chinese authorities like MIIT have already started to set up some mechanisms to manage the situation. At the same time, we also like to urge the companies in the upstream of the industry chain that they should think more from the long-term benefit of the overall development of the industry instead of manipulate or take the opportunity of the cost increases to increase their price.
Q: For OP margin, how should we think about SG&A and R&D expense in terms of either dollar terms or percentage to revenue in 2022?
William Li: Regarding the OP margin, in the coming years, we will continue to make decisive investments in terms of the R&D and the infrastructure. We would like to make sure we can use the gross profit to cover the SG&A costs.
By the year end of 2022, our R&D headcount is going to reach around 9000. In terms of the overall strategy, our target is that we can achieve breakeven for a single quarter in the fourth quarter of 2023, and we can achieve breakeven or reach profitability in 2024 for the full year.
Q: Can management talk about the utilization metrics of battery swap stations and how often people use it?
William Li: Cumulatively we have completed over 7.6 million swaps, and it means every day we can complete around 30,000 swaps.
Because we have deployed the power swap station network probably one or two years in advance, and the design target of the power swap station network is that the ratio between the power swapper to the user should be around 1 to 1000 users. If we look at our current power network, especially for the power swap network, we have over-deployed some power swap stations at this moment to make sure we have a much better experience for users.
For more information please visit:
NIO Q4 2021 Earnings on one page
NIO Q4 2021 Earnings on one page
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This article is a script from the NIO Q4 2021 earnings call. In order to facilitate reading, we have made appropriate cuts. If you want to know all the details, you can click here to re-watch the earnings call.
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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Deep Value : This is Tesla's real rival. The plunge of Chinese stocks recently dragged down NIO as well. Now the Market is still in the fear but NIO gives a good performance and great guidance to investors. It's time to build the position.
Macdonell J : Cathie Wood's ARKQ scooped up 420K NIO shares last Fri, at the same time together with ARKW sold off 28K Tesla's shares.
48685 : Way to go. Come on!
71268702 : Professional and all-round sharing for NIO, I think I choose the right place
71874900 : tesla has no rivals
Wilson LH 71874900 : agree!
Cuttnedgez Macdonell J : free gift
Cuttnedgez Macdonell J : $STOCK1016 (01016.HK)$ $CHINA SOUTH AIR (01055.HK)$ 100
疯狂的石头-Chris : good
Ab Woods : I like the analyst
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