On March 5, NIO-SW (09866.)HK) announced its financial results for the fourth quarter and full year of 2023. From the perspective of performance, although last year's sales and revenue were booming, NIO's financial data in 2023 has not improved significantly, and its operating losses continue to expand.
According to the financial report, NIO's revenue in 2023 will be 5561.8 billion yuan, a year-on-year increase of 129%, but the net loss widened by 43 percent year-on-year5% to 207200 million yuan; The consolidated gross margin was 55%, down 49 percentage points.
Such a report card is destined to fail to satisfy investors, and some investors call it "disappointing performance", while investment banks such as Da Mo, Bank of Communications International, and CICC have lowered their target prices or performance expectations. Among them, CICC said that the performance in the fourth quarter was mainly due to the expansion of expenses to the expansion of losses, and the performance was lower than market expectations.
In fact, the industry is not surprised by this performance. In the past year, both in terms of sales volume and quarterly results, NIO (NIOUS) performance is weaker than that of new car-making forces such as Li and Xiaopeng, and the market has mixed evaluations of performance growth and efficiency, and the company's stock price is also unsatisfactory.
However, although NIO is embattled, it is not without bright spots. For example, the new brand "Alps" series that NIO will launch in the second half of this year is regarded by many investors as a key battle for NIO to start a turnaround in 2024.
NIO lost 207200 million
Looking back on 2023, after NIO joined the price reduction army in June, its sales have been significantly boosted, and its sales exceeded 20,000 units in July of the same year, although NIO's monthly sales fell back to 1 two months later60,000 units are up and down, and the rally is slightly insufficient, losing to Ideal and Xiaopeng. However, for the whole year, its sales still increased by 30% year-on-year7%, to 160038 vehicles, ranking second among the new forces.
Thanks to the increase in deliveries, NIO's revenue scale has also increased. According to the financial report, in the fourth quarter of 2023, NIO achieved revenue of 1710.3 billion yuan, a year-on-year increase of 65%, down 103%；Annual revenue of 5561.8 billion yuan, a year-on-year increase of 129%。
However, from the perspective of profitability, NIO's losses have further intensified。In the fourth quarter of 2023, NIO had a net loss of 53.6.8 billion yuan, the year-on-year loss narrowed, and the month-on-month expansion was 178%。For the full year, the net loss in 2023 will be 207200 million yuan, an increase of 43 percent year-on-year5% and a gross margin of 55%, down 49 percentage points.
Sales and revenue both increased, but losses widened. So, where did the more than 6 billion thanks to go?
According to market analysis, the main reason for the further expansion of NIO's losses in 2023 isIt is NIO's ongoing spending on R&D and infrastructure.
In 2023, NIO's R&D expenses will be 134300 million yuan, a year-on-year increase of 239%。In comparison, Ideal's R&D expenditure in 2023 will reach 10.6 billion yuan, a record high, but there is still a lot of gap compared with NIO. You know, NIO's revenue is less than half of the ideal. It can be seen how willing NIO is to spend money on research and development. Some investors also believe that "NIO has invested so much in R&D, it must be holding back its big moves, waiting for the explosion to come out." ”
Specifically,In terms of product upgrades, in 2023, the old ES8, ES6, and EC6 will all switch to the second-generation platform, and NIO will also release the EC7, ET5T, and ET9. It is equivalent to sending six cars a year and completing the second-generation platform switch.
In addition, NIO regards the battery swap model as a moat in the development of the enterprise. In NIO's capital expenditure, the battery swap business is the largest part of investment in addition to technology self-development, which further increases NIO's financial pressure.
In recent years, NIO has continued to expand its battery swap network and has gradually grown into the world's largest operator of smart electric vehicle battery swapping network. Up to now, NIO has launched 2,367 battery swap stations nationwide, accounting for nearly 65% of the national total.
In addition, NIO is also making mobile phones, batteries, and developing chips. In this regard, some industry insiders analyzedAny one of these is a capital investment of tens of billions, and it is also a business that requires long-term investment and is difficult to achieve results in the short term. If the investment in these businesses is excluded, it is estimated that NIO will already be profitable.
At present, NIO mainly relies on selling cars to recoup its investment and make money. If sales are not good and NIO's funds are tightened, problems in each chain will be exposed.
To this end, NIO began to reduce costs and increase efficiency. First of all, NIO merged some redundant departments and positions, and directly eliminated inefficient positions, laying off 10% of employees, about 3,000 people. Second, investment in projects that do not improve financial performance is being cut or postponed. According to Li Bin's calculations, these measures will save NIO 2 billion yuan in costs in 2024.
In addition, throughout 2023, NIO is struggling to cope with model replacement, but the sales system cannot keep up, resulting in the loss of a large number of orders. To this end, NIO expanded its sales force, recruiting more than 3,000 sales consultants in two months to sell cars.
Will the new brand "Alps" turn the tide?
At the moment when the domestic auto market is extremely involuted, the 2024 knockout round has begun. For example, Weimar withdrew gloomily and Gaohe Automobile was suspended, and the competition in the new energy market has reached a white-hot point.
In response to market competition, recently, BYD and Tesla took the lead in firing the first shot of "price reduction". Subsequently, Geely, Changan, Chery, Xiaopeng, Nezha, SAIC Volkswagen and other brands have joined the competition of price reductions, from independent to joint venture brands, from new energy vehicles to fuel vehicles, price reductions are fiercer than one another.
Huatai ** said that 2024 is still a critical year for the "oil and electricity war", and it is inevitable that the price reduction of new energy, especially the leading enterprises, will lead to the phased price reduction of fuel vehicles. The price reduction of new energy vehicles this time is mainly due to the off-season superposition of new car clearance preparations before the launch. In the second quarter, a number of blockbuster new cars will be released intensively, such as Ideal MEGA, Xiaomi SU7, Tank 700Hi4-T, ZEEKR 001 facelift, Deep Blue C318, Tank 300PHEV, Qin L, Yuan UP, etc., and the demand for car purchases under the new car cycle is expected to be activated.
In this regard, NIO made it clear that it did not want to participate in the ** war. Giving up the powerful ** of price reduction means that NIO can only rely on products and channels, and the challenge is not small.
Li Bin, chairman of NIO, said at the results meeting that the growth of new brands for the mass market is the company's top priority in 2024.
And this new brand is "Alps".The price is 200,000-250,000 yuan to fill the gap of the current brand. It is reported that the first new car of the "Alps" series rolled off the assembly line in the fourth quarter of last year, and the plan is to release it in the third quarter of this year and start mass delivery in the fourth quarter.
Li Bin said that Alps' first product will be benchmarked against Tesla's Model Y, and the second product will be an SUV product for large families.
In the context of fierce competition in the current market environment and the launch of a number of popular new cars on the market, NIO hopes to reverse the decline in performance and make up for the huge losses of more than 10 billion yuan by launching the "Alps" series, which is undoubtedly a difficult task. At present, investment banks and brokerages are cautious in lowering NIO's performance expectations and target prices.
CICC pointed out that in consideration of industry competition and mass production of "Alps", the non-profit deduction in 2024 will be lowered to -14.8 billion yuan (the previous value is -12.9 billion yuan), and the new non-profit deduction in 2025 will be -9.8 billion yuan. Considering the intensifying competition in the sector, the target price of Hong Kong and US stocks was lowered by 24% and 24% to HK$62 and US$8 respectively.
BOCOM International believes that although the first model of "Alps" will be launched next year, due to the independent sales network of the sub-brand and the development expenses of new models, the bank expects the company's losses to continue to be high, and the industry's first war will also have a negative impact on the valuation of the sector in the short term, and lowered its target price to 40$3.
Author: Bottle.