Nio expects monthly deliveries to average more than 40,000 in the fourth quarter, CEO William Li said during the company’s second-quarter earnings call on the evening of September 1. It also continues to target annual sales growth of 40–50% over the medium to long term.
Nio, which trades in Hong Kong and the US, released its 2026 interim results the same day. Second-quarter deliveries reached 107,658 vehicles, up 49.4% year-on-year (YoY) and 29% from the previous quarter. The Nio brand accounted for 60,945 deliveries, Onvo for 29,124, and Firefly for 17,589.
Higher sales across all three brands and a larger share of higher-end models helped lift second-quarter revenue to RMB 32.137 billion (USD 4.8 billion), up 69.1% YoY and 25.9% from the previous quarter. Vehicle sales revenue rose 80.1% YoY to RMB 29.058 billion (USD 4.3 billion).
Second-quarter gross profit rose 211.3% YoY to RMB 5.907 billion (USD 878 million). Gross margin increased to 18.4% from 10% a year earlier, while vehicle margin rose to 18.5% from 10.3%.
On a non-GAAP basis, Nio reported adjusted operating profit of RMB 207 million (USD 30.8 million) and adjusted net profit of RMB 26.1 million (USD 3.9 million) for the quarter. This was its third consecutive quarter of non-GAAP operating profit, following the fourth quarter of 2025 and the first quarter of 2026.
At the end of the second quarter, Nio held RMB 56.7 billion (USD 8.4 billion) in cash and cash equivalents, restricted cash, short-term investments, and long-term time deposits. Both operating cash flow and free cash flow were positive during the quarter.
Deliveries remained elevated as Nio entered the third quarter. The company delivered 35,934 vehicles in July and 35,836 in August. Deliveries in the first eight months of the year reached 262,893, up 57.9% YoY. By the end of August, Nio had delivered 1,260,485 vehicles since inception.
Nio plans to use its three brands to serve different price segments. The Nio brand will continue to focus on premium battery electric vehicles, Onvo will target mainstream family buyers, and Firefly will focus on premium compact cars.
In August, the Nio brand delivered 21,174 vehicles, Onvo delivered 8,810, and Firefly delivered 5,852. The new ES8 accounted for 10,999 deliveries during the month. On August 21, the model reached 140,000 cumulative deliveries, 335 days after deliveries began.
Nio expects third-quarter deliveries of 108,000–111,000 vehicles in 2026, up approximately 24.0–27.5% YoY. It forecasts revenue of RMB 33.285–34.051 billion (USD 4.9–5.1 billion), an increase of approximately 52.7–56.2% YoY.
On August 7, Nio opened its 4,000th battery swap station worldwide, also its first fifth-generation station. The company plans to add about 1,000 more stations, with most of the investment expected to come from participants in its “Power Up Partner” program. It has reached related agreements with more than 40 local state-owned enterprises and financial institutions across 25 Chinese provinces and municipalities.
Separately, GeniTech, Nio’s smart driving chip subsidiary, signed agreements in June and August for two funding rounds totaling RMB 493 million (USD 73.3 million), implying a post-money valuation of about RMB 12.25 billion (USD 1.8 billion). Upon completion, a Nio subsidiary will hold a controlling stake of 59.95% in GeniTech, which will remain consolidated in Nio’s financial statements.
During the earnings call, Li and other members of management answered questions about vehicle deliveries, revenue, profitability, the battery swap network, smart driving, and other topics.
The following transcript has been edited and consolidated for brevity and clarity.
Q: Can the Nio ES8 and ES9 sustain demand, and what sets them apart in the premium SUV market?
Demand for both the ES8 and ES9 remains very strong.
The ES8 delivered 10,999 units in August 2026, bringing cumulative deliveries to more than 140,000 less than a year after launch. We expect the 150,000th delivery in September. That would mean more than 150,000 ES8s delivered within the model’s first year on the market, bucking the pattern in China, where newly launched models often struggle to sustain strong sales.
Demand for the ES9 has also remained strong since deliveries began. Delivery wait times for the Horizon special edition and Signature edition currently exceed three months and are approaching four months.
July still included some early expressions of interest. Looking only at new orders, however, the ES9 received more in August than in July. We therefore remain confident that the model can sustain strong sales.
More than three-quarters of ES9 buyers came from outside Nio’s existing user community, indicating that the model has extended the brand’s reach beyond its established customer base.
The first reason users have responded positively to the ES9 is technological innovation. It incorporates dozens of technologies that are either industry firsts or among the leaders in its segment. Technological innovation remains a key competitive strength for us.
Second is how the product addresses customers’ needs. The ES9 closely meets the needs of premium buyers seeking a vehicle for both family and business use. It has received strong feedback on both its functionality and the emotional value of the ownership experience.
Third is the charging, battery swap, and after-sales service network. The charging and battery swap network, together with after-sales services, creates a combined advantage that competitors find difficult to replicate. Premium customers place considerable importance on a comprehensive service system and the service experience.
Fourth is brand value. China’s new energy vehicle market is moving from a period of brand fragmentation toward clearer brand positioning. Consumers are giving brand choice greater priority instead of simply comparing specifications.
Nio has already established relatively clear brand recognition in the premium battery electric vehicle market.
Brand now accounts for more than 30% of the factors influencing Nio users’ purchase decisions. Based on vehicle insurance registration data, the Nio brand’s average transaction price in China was RMB 406,000 (USD 60,000) in the second quarter of 2026, above those of the traditional German luxury brands BMW, Mercedes-Benz, and Audi. The average transaction price rose further to more than RMB 430,000 (USD 64,000) in July.
We believe brand scarcity and competitiveness will provide an important foundation for the long-term competitiveness of Nio, Onvo, and Firefly.
Q: How will Nio improve Onvo’s conversion of sales leads into orders and sustain order growth?
Competition in Onvo’s market is indeed more intense. It faces significantly more competing brands and models than Nio or Firefly.
But Onvo has still performed well within its specific segment since launch.
In the first half of 2026, despite pressure on China’s overall passenger vehicle market, Onvo’s average transaction price exceeded RMB 240,000 (USD 36,000) and increased significantly YoY.
Only eight brands in China increased both sales volume and pricing in the first half, and Onvo was one of them. Its average transaction price also exceeded those of some traditional luxury brands, laying a foundation for its development into a high-quality family vehicle brand.
Onvo’s conversion rate from sales leads to orders is relatively high for the industry. This suggests that once consumers experience the product, they are relatively likely to buy it.
The main challenge today is therefore brand awareness rather than product competitiveness. Onvo’s current brand awareness is roughly comparable to Nio’s five or six years ago.
We will take a more proactive approach, including cross-industry collaborations, in-person events, and deeper community engagement, to raise awareness of Onvo and introduce it to more consumers.
At the same time, we will accelerate the rollout of stores shared by Nio, Onvo, and Firefly, continuing to expand our sales network so Onvo can reach more families in China’s lower-tier cities.
We will also continue introducing new products to serve a broader range of families. However, Onvo will retain its positioning as a high-quality family vehicle brand. It will not enter excessively low price segments and will continue to balance sales volume with vehicle margin.
We believe China still lacks a family car brand capable of serving customers who might otherwise buy higher-end Toyota or Volkswagen products. That is Onvo’s opportunity.
Q: What new models and product updates are planned across Nio and its sub-brands for 2027?
The Nio brand will introduce new products in its 5 and 6 series lineups. The market already has some understanding of those plans.
Onvo will launch a major new product in 2027 to further expand its lineup.
Firefly will retain its single-model strategy while introducing special editions and ongoing technology upgrades.
Its product strategy is similar to the iPhone’s: continuously developing one principal model while offering different versions.
Q: Why does Nio’s management believe the improvement in profitability is sustainable rather than cyclical?
The improvement in profitability comes from several factors.
First, China’s automotive market is gradually entering a stage in which competition is increasingly centered on brands. The ES8 and ES9 have maintained stable demand in their respective segments and account for a relatively large share of our product mix. Vehicle margins for both models exceed 20%, providing an important foundation for our overall gross margin.
Second, we will continue improving our cost structure, defining products more precisely around customer needs, and working with supply-chain partners to identify opportunities to reduce costs.
This work has been underway for several quarters. Internally, we have also examined our research and development (R&D) and supply-chain capabilities in greater detail to identify further opportunities for structural cost reductions.
In the first half of this year, despite intense competition in the automotive market and rising raw material and memory chip prices, our sales volume increased 67% YoY, revenue rose 86%, and gross profit increased 282%.
Revenue grew faster than sales volume, while gross profit grew significantly faster than revenue. That reflects the quality of our growth.
Average costs per vehicle in the second quarter were about RMB 14,000 (USD 2,080) higher than at the end of last year. We expect them to rise by another RMB 2,000–3,000 (USD 300–450) in the second half.
That means average costs per vehicle in the second half could be RMB 16,000–17,000 (USD 2,380–2,530) higher than at the end of last year. Despite those increases, we remain confident that we can continue to grow gross profit.
This reflects the company’s combined competitive strengths in technology, products, the supply chain, sales, branding, and operational management.
Q: What is the full-year free cash flow outlook, and how will Nio allocate its cash?
We expect full-year capital expenditures of about RMB 6–7 billion (between USD 891.8 million and USD 1 billion) in 2026, broadly in line with last year.
Spending will primarily support vehicle R&D and the development of our sales and service network. Investment in factories and additional production capacity will be relatively limited.
We will also continue expanding the charging and battery swap network, with a target of adding another 1,000 battery swap stations this year.
What has changed is that, since launching the “Power Up Partner” program in 2024, we have worked with more than 40 local state-owned investment platforms and financial institutions across 25 provinces and municipalities nationwide.
Most of the financing for this year’s planned additions to the charging and battery swap network will come from partners.
The battery-as-a-service model is also gaining wider acceptance among users and financial institutions. In the first half of 2026, Weineng further expanded its access to financing.
Nio’s receivables from Weineng declined from about RMB 16 billion (USD 2.4 billion) at the beginning of the year to less than RMB 15 billion (USD 2.2 billion) at the end of the second quarter.
The absolute amount of receivables declined even as more batteries were deployed, supporting Nio’s cash flow.
As sales grow and operations continue to improve, our goal is to maintain positive operating cash flow and free cash flow in both the third and fourth quarters and further build our cash reserves.
Q: How will Nio distinguish itself in smart driving? Will it consider pay-per-use, subscriptions, or other charging models in the future?
This year, we have demonstrated the advantages of our technical approach, which combines world models, closed-loop reinforcement learning, and collective intelligence.
Despite investing significantly less in cloud-based training computing resources than some peers, we have still delivered a strong user experience, demonstrating the efficiency of our technical approach.
On June 18 this year, we simultaneously released the latest version of the Nio World Model to about 700,000 users across different brands and technology platforms. That also demonstrates the sophistication of our architecture and its ability to be reused across platforms.
Among users of our third-generation platform equipped with the proprietary Shenji NX9031 chip, about 58% use driving assistance for more than half the distance they travel in everyday driving.
As part of our business model, we provide five years of free driving assistance services to buyers of new Nio and Onvo vehicles.
We will offer paid subscriptions to used-car buyers and to customers who reach the end of their five-year free period in the future.
The driving assistance subscription for used-car customers currently costs RMB 380 (USD 56.5) per month, with a paid subscription rate approaching 20%.
The paying user base remains relatively small at this stage, and related subscription revenue in 2026 amounts to an eight-figure RMB sum.
As the user base expands, we believe subscriptions will become an important source of service revenue for the company over the long term.
Q: How do Nio’s fifth-generation battery swap stations compare with earlier versions, and how will the company charge other automakers?
The fifth-generation battery swap station has a flexible design that accommodates vehicles of different sizes across the Nio, Onvo, and Firefly brands.
Construction costs for a fifth-generation station are about RMB 1.4 million (USD 208,000), roughly RMB 100,000 (USD 15,000) less than for a fourth-generation station. That excludes batteries housed in the station, supporting high-voltage infrastructure, and energy connection costs.
In operations, we have continued to improve staffing efficiency, swap success rates, and software capabilities.
Overall labor efficiency across the battery swap network has improved by about 50% since the beginning of 2025.
The fifth-generation station is still in the early stages of operation, but its performance has already surpassed that of previous generations at a comparable stage.
We expect its long-term operating efficiency to improve further.
For external partnerships, we have signed battery swap alliance agreements with several automakers and continue to discuss and negotiate specific projects.
As the robotaxi industry develops, battery swapping is well suited to its operations, and we are also exploring related opportunities with partners.
Our current approach to external partnerships centers on charging an access fee for the battery swap network. We will disclose specific details once projects are implemented.
Bringing more automakers into the battery swap system would help spread the energy business’s operating costs across a larger user base. Standardized battery packs could also improve battery asset utilization and reduce costs.
Q: Why did Nio’s selling and marketing expenses rise, and what is its 2026 expense outlook?
For R&D, we expect non-GAAP spending of about RMB 2.5 billion (USD 371.6 million) per quarter in 2026. We will adjust the amount and pace of spending as R&D projects and the business develop.
Current R&D spending is lower than the company’s historical investment levels or those of some peers, but our R&D efficiency is higher.
For one thing, we have long focused on battery EV technology. We do not need to invest simultaneously in multiple technologies, such as battery electric, hybrid, and extended-range EVs..
That keeps our R&D efforts more focused, while key technologies can also be reused across brands and models.
For another, since introducing the CBU operating mechanism in 2025, we have continued to improve our internal R&D system and organizational efficiency.
As a result, even with relatively moderate investment, we can keep our key technologies and products competitive.
Non-GAAP selling, general, and administrative expenses were equivalent to about 13% of revenue in both the first and second quarters of 2026.
Selling expenses increased in the second quarter mainly because most of this year’s new products launched during the period, including the ES9 and several updated Onvo models. These launches generated about RMB 500 million (USD 74.3 million) in one-time expenses.
We do not expect one-time spending on a similar scale in the third or fourth quarters.
For the second half, our goal is to keep non-GAAP selling, general, and administrative expenses at 10–11% of revenue. We currently believe that target is manageable and achievable.
Q: Ren Shaoqing, Nio’s head of smart driving, founded an embodied intelligence startup in which Nio has invested. How could the two sides collaborate in the future, and what long-term value could the investment bring?
Ren Shaoqing will start a business in physical artificial intelligence, with Nio supporting the venture as a strategic shareholder.
At the same time, Ren will remain head of Nio’s smart driving division, responsible for the direction and long-term strategy of its smart driving technology. He will also continue participating in related work.
This arrangement allows Nio to remain focused on its main business while maintaining strategic exposure to embodied intelligence and physical AI, without diverting resources from its principal operations.
It also makes it easier to attract additional external shareholders and investors.
Competition for talent in physical AI is extremely intense. A startup’s organizational structure and incentives should make it easier to attract leading industry talent and increase the venture’s chances of success.
Over the long term, we believe Nio and the embodied intelligence startup will pursue substantial strategic and business cooperation.
Q: What is Nio’s sales outlook for the fourth quarter of 2026 and for 2027? With a new product cycle beginning next year, what is its medium- to long-term sales growth target?
We believe China’s automotive market will recover to some extent in the fourth quarter of 2026.
Nio’s target for the fourth quarter is to deliver more than 40,000 vehicles per month on average.
Over the medium to long term, based on our current product portfolio and the expansion of our sales and service network, we continue to target annual sales growth of 40–50%.
This article was adapted based on a feature originally written by SY and published on IPO Zaozhidao. KrASIA is authorized to translate, adapt, and publish its contents.
Note: RMB figures are converted to USD at rates of RMB 6.73 = USD 1 based on estimates as of September 11, 2026, unless otherwise stated. USD conversions are presented for ease of reference and may not fully match prevailing exchange rates.