AutoBeta(AutoBeta.net)09/29 Report--

After a huge loss, the company continued to expand, and officials announced the opening of nine more stores during the National Day holiday, including one NIO House and eight NIO Space. NIO Space has a smaller scale and less investment than NIO House, and its main function is to sell cars.

NIO House has a huge investment and is laid out in the core business district of first-tier cities, while NIO Space is mainly concentrated in small and medium-sized cities, expanding the sales channels of NIO. It is understood that the area of NIO Space is smaller, most of the single store area is 100-200m2, and the cost is lower, each cost is about 1 million RMB.

After the opening of the above stores, NIO will have 21 NIO House,24 NIO Space in the country.

On the recent NIO performance conference call, the management of NIO Automobile said that it would change from more than 9000 employees to more than 7000 in the future, and would increase its investment in NIO space. It means that the rapid expansion of Ulai leads to overstaffing, and its focus will shift to sales.

NIO's second-quarter results showed that revenue was 1.508 billion yuan, higher than the market expectation of 1.309 billion yuan, while the net loss attributed to shareholders in the second quarter was 3.285 billion yuan, higher than the market expectation of 2.944 billion yuan, compared with a loss of 6.11 billion yuan in the same period last year. In the first half of 2019, NIO made a cumulative loss of 5.9086 billion yuan, of which the net loss in the first quarter reached 2.6236 billion yuan.

In the phone response to the financial report, NIO first clarified the rumors that foreign media reported a loss of 40 billion yuan. NIO clarified that the company's current loss is actually 22 billion yuan.

When talking about why the company's profit margin fell sharply in the second quarter, Ulai said that the car recall was an important reason for the sharp decline in its profit margin. The company said that if the recall cost of 339 million yuan was deducted, its profit margin on car sales would have been-4%, up from-7.2% in the first quarter.

However, negative profit margins will continue. NIO expects car profit margins to be around-6% in the third quarter and-6% to-10% in the fourth quarter.

The company delivered 3989 new cars in the first quarter of 2019 and a total of 3553 in the second quarter. It expects to deliver between 4200 and 4400 vehicles in the third quarter.

NIO shares closed at $1.75 on Sept. 27, with a total market capitalization of only $1.839 billion.

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