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Will NIO Miss Q1 Revenue Estimates Like Tesla, Tencent, and Baidu?

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May. 24 2019, Published 2:57 p.m. ET

NIO’s Q1 2019 earnings

Chinese electric car company NIO (NIO) is slated to release its first-quarter earnings on Tuesday. Wall Street analysts expect the company to report a wider adjusted net loss of 3.23 Chinese yuan per share, compared to 3.20 per share in the previous quarter.

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NIO’s Chinese peers missed revenue estimates

Last week, NIO’s Chinese tech peers Tencent Holdings (TCEHY) and Baidu (BIDU) reported their results for the quarter ended March 2019. For the quarter, the Chinese gaming giant Tencent Holdings’ revenue stood at 85.5 billion Chinese yuan, up about 16% on a year-over-year basis but worse than analysts’ estimates of 88.1 billion yuan.

While Baidu’s revenue rose 21% year-over-year to 24.1 billion Chinese yuan in the first quarter, it came in slightly lower than analysts’ estimate of 24.2 billion yuan.

NIO’s American peer Tesla (TSLA) posted $4.5 billion in revenue in the quarter that ended in March 2019, which was far worse than analysts’ consensus estimate of $5.2 billion. Tesla’s lower-than-expected Model 3 car deliveries during the quarter affected its revenue.

Analysts’ estimates for NIO’s Q1 revenues

In the fourth quarter, NIO reported net revenue of 3.44 billion yuan, about 134% higher than its revenue of 1.47 million yuan in the third quarter. Analysts expect the company to report revenue of 1.5 billion yuan in the first quarter, reflecting a massive sequential drop of 55.6%.

In January and February 2019, the company delivered 1,805 and 811 units, respectively, of its ES8 car model—much lower than its 1,573 and 3,089 units in October and November 2018, respectively. These lower car deliveries are likely to hurt NIO’s first-quarter revenues.

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