NIO reported breakthrough improvements in profitability and operational efficiency during the third quarter, with vehicle margin climbing to 14.7%, the highest level in nearly three years. The Chinese electric vehicle maker also issued fourth-quarter guidance for revenue and deliveries that would mark all-time records for the company.

Total revenue reached 21.8 billion yuan ($3.06 billion) in the third quarter, up 16.7% year-on-year, while deliveries of 87,071 smart electric vehicles represented a 40.8% annual increase. Gross profit rose 50.7% to 3.02 billion yuan, with overall gross margin improving to 13.9% from 10.7% a year earlier.

For the fourth quarter, NIO projects deliveries of 120,000 to 125,000 vehicles, representing year-on-year growth of 65.1% to 72.0%. Revenue is expected to range between 32.8 billion yuan and 34.0 billion yuan, up 66.3% to 72.8% from the same period last year.

Following the earnings announcement on November 25, NIO's U.S.-listed shares surged as much as 9% in pre-market trading.

Multi-Brand Strategy Drives Delivery Momentum

Third-quarter deliveries reflected the effectiveness of NIO's three-brand strategy. The flagship NIO brand delivered 36,928 vehicles, while Onvo, positioned for family consumers, contributed 37,656 units. Firefly, the company's compact premium electric vehicle brand, delivered 12,487 units.

In October alone, NIO delivered 40,397 vehicles. Cumulative deliveries reached 241,618 units through October 31, 2025, bringing total lifetime deliveries to 913,182 vehicles.

Founder, Chairman and CEO William Li noted that the all-new ES8 achieved the fastest time to 10,000 deliveries among pure electric vehicles priced above 400,000 yuan in China's market. The Onvo L90 maintained its position as the best-selling large pure electric SUV for three consecutive months, while Firefly rapidly established a leading position in the compact premium electric vehicle segment since its initial delivery.

Cost Optimization Enhances Profitability

Vehicle sales reached 19.2 billion yuan in the third quarter, up 15.0% year-on-year and 19.0% quarter-on-quarter. Despite lower average selling prices due to product mix changes, continued reductions in material costs per vehicle drove the vehicle margin from 10.3% in the previous quarter to 14.7%.

Other sales revenue totaled 2.6 billion yuan, up 31.2% annually, primarily from increased used car sales, technology research and development service revenue, and higher sales of parts, after-sales services and energy solutions driven by a growing user base.

Chief Financial Officer Stanley Qu stated that vehicle margin improved quarter-on-quarter to 14.7% through continued cost optimization and increased proportion of high-margin vehicle deliveries, bringing overall gross margin to the highest level in the past three years.

Operating Expense Control Boosts Efficiency

Research and development expenses totaled 2.4 billion yuan in the third quarter, down 28.0% year-on-year and 20.5% quarter-on-quarter. On a non-GAAP basis, R&D expenses fell 33.2% annually to 1.9 billion yuan, primarily due to lower personnel costs from organizational optimization and reduced design and development costs as new products and technologies entered different development stages.

Selling, general and administrative expenses reached 4.2 billion yuan, up 1.8% year-on-year and 5.5% quarter-on-quarter. The increase from the previous quarter stemmed from additional sales and marketing activities related to new product launches.

Operating loss narrowed to 3.5 billion yuan, improving 32.8% year-on-year and 28.3% quarter-on-quarter. Non-GAAP adjusted operating loss was 2.8 billion yuan, narrowing 39.5% annually and 31.3% sequentially. As of quarter-end, the company held 36.7 billion yuan ($5.1 billion) in cash and cash equivalents, restricted cash, short-term investments and long-term time deposits.