Prominent Chinese electric vehicle (EV) company, NIO Inc (NYSE: NIO) is among the high aspiring companies but unable to grow, given the heavy competition. Consumer preferences, competitive big industry players, pricing power and gross margins remain to be the burning issues for the company. All of this is  reflected on the NIO stock price performance. 

Given the awareness towards the EVs, the demand shot up and so did the players to cater at the similar pace, maybe even faster. The cut-throat competition in the EV sector due the presence of Tesla and BYD-like giants, NIO is left with its struggles. 

The bleak performance of the NIO quarterly earnings report indicates the uncertainty with valuation. Net losses, unstable gross profit, lagging in deliveries and practicality concerns with its battery as a service business. 

The Chinese EV company posted its first quarter earnings for 2023 on June 9. NIO reported a quarterly revenue of $1.55 Billion in Q1 2023, with an increase of 7.7% year over year but down by 33.5% from the previous quarter. 

NIO took a punch in the face in terms of gross profit with $23.6 Million for the quarter, which was 88% down from the previous year and 73.9% down from the last quarter.  

The number of vehicles delivered during the quarter was 31,041 cars. Though the deliveries were up by 20.5% from the previous year, it was 22.5% less than the previous quarter. 

Despite the company’s long-time struggle , NIO stock price has surged since around June, this year. The deliveries and revenue has shown an improvement in comparison to last year, while the net losses have dropped 18% during the similar time frame. Additionally, the management came along with the decision to increase the company’s recently launched electric vehicles, cutting the costs. 

NIO Stock Price Movement

Since June, the NIO stock price has jumped up to 45% from $7 to $11 during the intraday trading session on Thursday, July 13, 2023. However, the stock price tanked 23% since the starting of 2023 before making the up move. 

Currently, NIO stock is trading at $10.56 following a slight 0.19%  increase of. The stock price is between the 50- and 200-day EMA, and has retraced back from the immediate resistance below 200-day EMA at $11. 

MACD indicated the positive sentiment with a slight curve, showcasing a downtrend in NIO stock price down the line. RSI at 61 shows optimism in favor of NIO stock. 

Disclaimer

The views and opinions stated by the author, or any people named in this article, are for informational purposes only and do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.