Morgan Stanley Reiterates Nio’s PT and Rating Amid Q1 Results

Morgan Stanley analyst Tim Hsiao reiterated on June 3, 2025, an ‘Overweight’ rating and $5.90 price target on Nio.

“1Q details

Overall revenue fell 39% QoQ but grew 21% YoY to Rmb12bn in 1Q, falling shy of company guidance of Rmb12.4-12.9bn with 2% ASP QoQ dip.

Vehicle gross margin fell 2.9ppt QoQ but rose 1.0ppt YoY, to 10.2%, likely reflecting inferior scale and unfavorable product mix (higher sales of Onvo).

Overall GPM also fell 4.1ppt QoQ, to 7.6%, below our estimate of 8-9%. Opex fell QoQ, – R&D fell 12% QoQ and SG&A fell 10% QoQ, reflecting cost savings from restructuring. NIO’s cash balance (including restricted cash, short-term investments, and long-term deposits) fell Rmb16bn QoQ, to Rmb26bn, marking the trough and likely improving from 2Q along with sales recovery.

More on 2Q outlook

Revenue guidance of Rmb19.5-20.1bn (up 62-67% QoQ) suggests a high single-digit sequential ASP downturn in 2Q, likely reflecting growing discounts ahead of the 5/6-series facelifts in May and rise in the mix of Firefly brand.

All eyes remain on volume resurgence and cash flow.”

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