Barclays Lowers Nio’s PT to $3.00 Amid Q1 Results
Barclays analyst Jiong Shao lowered on June 4, 2025, the price target on Nio to $3.00 (from $4.00) while maintaining a ‘Underweight’ rating.
“Summary: 1Q revenue came in 5% below our estimate and missed guidance, mainly due to lower ASP with higher promotions for inventory clearance for old NIO models and an increased product mix of ONVO brand. Vehicle gross margin fell to 10%, and adj. opm/adj. net margin both widened to around -50%, still far from 4Q25’s breakeven target.
On the bright side, NIO has implemented a series of cost-efficiency measures since March, including reorganization and cross-brand integration. R&D resources across three brands have merged and ONVO/NIO brands sales now are managed together, though stores remain separated.
We expect operating efficiency to improve from 2Q. However, the company’s full year doubled deliveries guidance an d 4Q breakeven target remain challenging.
Deliveries are mainly contributed by NIO and ONVO brands, each targeting 25k monthly units by 4Q.
NIO brand has launched refreshed ES6/EC6/ET5/ET5T models in late May, and we’ll await more sales color to lift deliveries from the 19k reported in April and 13k in May (lower likely ahead of new model launches).
ONVO’s L60 model has gradually ramped up volume to 6.3k in May and aimed at 10k units per month. It will launch and deliver a three-row SUV L90 in 3Q and L80 in 4Q; these likely point to a nearly doubling L60 sales and a comparable delivery scale for L90.
On overseas expansion, management didn’t set high expectations.
Again, we believe achieving volume scale is fundamental to improving margins and the 50k monthly units target by year-end appears challenging, especially amid intensifying competition in China.
What we liked: cross-brand integration, focus on cost efficiency, increasing ONVO and Firefly deliveries
What to monitor: sales of new NIO and ONVO models, Firefly overseas expansion from 3Q, vehicle margin improvement, breakeven target in 4Q.”
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