Nio - Lacerating losses. What's next?

Things do not look good.

Even though prices are up, there is little to no reason for stock prices to rally.

Here's why.

While Nio might not be aiming for profitability yet, its key highlights are way off.

Deliveries for Q1'23 are 31,041, down from the 40,052 in Q4'22.

On top of lower deliveries, vehicle margins were only 5.1% in Q1'23 compared to 18.1% in Q1'22.

Gross margin was just at a sad 1.5% for Q1'23 compared to 14.6% in Q1'22 and 3.9% in Q4'22.

Losses from operations ballooned to RMB 5,111.8 million, a whopping increase of 133.6% from Q1'22.

The scary part is the Q2'23 outlook. Management is not targetting growth in terms of deliveries. Deliveries are only going to be 23,000 and 25,000 vehicles, which represents a decrease of 8.2% to 0.2% from Q2'22.

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