NIO Q2 FY26 earnings call NIO

NIO Inc. reported strong Q2 deliveries of 107,658 smart EVs, a 49.4% YoY increase. All three brands—NIO, ONVO, and FIREFLY—achieved YoY and QoQ growth in sales volume and average transaction price. The NIO brand delivered 60,945 vehicles, leading the premium segment above RMB 350,000. ONVO delivered 29,124 vehicles, and FIREFLY delivered 17,589 vehicles, maintaining leadership in the high-end compact car market for 15 consecutive months. The ES8 achieved 140,000 deliveries in 335 days, while the ES9 is seeing strong demand with 3-4 month waiting times for new orders.

Total revenues reached RMB 32.1 billion, up 69.1% YoY. Vehicle sales were RMB 29.1 billion, up 80.1% YoY. The company maintained a solid vehicle gross margin of 18.5% and an overall gross margin of 18.4% in Q2, despite facing approximately RMB 14,000 per car in material cost increases from late Q4 last year. NIO generated positive operating cash flow and free cash flow, boosting its cash reserves to RMB 56.7 billion, strengthening its financial foundation for sustainable development.

NIO rolled out the latest version of its NIO World model to over 700,000 NIO and ONVO users on June 18, leveraging its world model architecture and closed-loop reinforcement learning. This upgrade led to a 9.8% increase in urban NOP mileage for NIO users and a 127.8% increase in urban NOA mileage for ONVO users. NIO is the first car company to develop and deploy smart driving systems across general purpose and proprietary chip platforms simultaneously, ensuring a continuously evolving experience for users.

The company continues to expand its power network, reaching 4,123 power swap stations and 30,294 power and destination chargers worldwide. The 4,000th power swap station, a fifth-generation model launched on August 7, supports all NIO, ONVO, and FIREFLY models and offers enhanced operational efficiency. The fifth-generation station costs approximately RMB 1.4 million (excluding batteries and high-voltage supply), which is RMB 100,000 cheaper than the fourth generation. NIO is also exploring value-added businesses like electricity trading through its standardized power operations.

NIO emphasizes that the automotive market is shifting from product-level competition to comprehensive system capabilities and brand clarity. The company's commitment to premium BEV strategy and system building aligns with this evolution. Internally, NIO is focused on cost reduction through accurate product definition and supply chain optimization, aiming to stabilize vehicle gross margins despite ongoing material cost pressures. The company also plans to maintain R&D expenses at around RMB 2.5 billion per quarter and reduce SG&A as a percentage of sales revenue to 10-11% in H2 FY26.

For the NIO brand, new products from the 5 and 6 Series are expected next year. ONVO will introduce a major strategic new product to enrich its lineup, while FIREFLY will maintain a single-model strategy with special editions and technology upgrades. NIO has also made a strategic investment in an embodied AI start-up founded by its Head of Smart Driving, aiming to track physical AI developments without diluting core business focus and to attract top AI talent, with long-term strategic collaborations expected.