- NIO stock was trading sharply higher in pre-market trading today. The company released its March deliveries report.
- The company delivered 1,533 electric vehicles in March—up 117% from February. In the first quarter, NIO delivered 3,838 vehicles. During the earnings call for the fourth quarter of 2019, the company said that it expects to deliver between 3,400 and 3,600 vehicles in the first quarter.
NIO (NYSE:NIO) stock was trading with strong gains in pre-market trading today. The company’s March delivery report showed that it delivered 1,533 vehicles in the month—up sharply from February. Notably, the company’s March deliveries were better than expected. The company’s deliveries beat the expectations in February even though the coronavirus impacted China. Tesla’s first-quarter deliveries were also better than expected.
In the release, NIO said that its order backlog has risen since February. The company also said, “As the COVID-19 outbreak is largely brought under control in China at this stage, we will continue working closely with our supply chain partners to resume normal productions.” Overall, the COVID-19 pandemic took a toll on the company’s operations in China. While the automotive industry has shut down in most leading economies, China’s automotive industry has resumed operations.
NIO’s Q4 earnings
Last month, NIO released its fourth-quarter earnings. Although the company missed the earnings estimates, its revenues were better than expected. The stock fell sharply after its fourth-quarter earnings and outlook spooked investors. The company expects to post positive gross margins in the second quarter. By the end of this year, NIO expects its gross profit margins to rise to double digits. The increase might sound like a tall task. Currently, the company posts negative gross margins. However, NIO took several measures, including layoffs, to control its costs last year. The company has also faced a financial crunch. The company has raised capital by issuing convertible notes. Earlier this year, Tesla also raised money by selling shares.
NIO stock has fallen almost 39% year-to-date. Meanwhile, Tesla (NASDAQ:TSLA) is in the green. Tesla is among the rare stocks that delivered positive returns in the first quarter. However, even Tesla has fallen sharply from its February peak. In March, Tesla turned negative for the year, but it bounced back. The company’s first-quarter deliveries also surprised on the upside despite COVID-19. While NIO’s March delivery report looks encouraging, the stock still isn’t out of the woods. Read NIO Stock Still Faces Challenges, China Limps to Normalcy to learn more.