Weilai's second quarter report card was released, and its revenue exceeded 10 billion yuan for the first time, but it did not get rid of the strange circle of "increasing revenue and not increasing profits".
On September 7, WEILAI disclosed the second quarter of 2022 performance announcement showing that the second quarter revenue was 10.29 billion yuan, an increase of 21.8% year-on-year, an increase of 3.9% month-on-month, and the single-quarter revenue exceeded 10 billion yuan for the first time; Among them, the sales revenue of automobiles was 9.571 billion yuan, an increase of 21% year-on-year. Net loss was RMB2.757 billion, an increase of 369.6% compared to the same period last year; Net loss attributable to common shareholders was $2,745 million.
In the second quarter, NIO delivered about 25,100 new vehicles, an increase of 14.4% year-on-year, but a slight decrease of 2.8% from the previous quarter. Li Bin, founder, chairman and CEO of NIO, revealed on the earnings call that the delivery guideline for the third quarter was 31,000-33,000 vehicles, which is the highest delivery guideline in a single quarter. The above delivery guidelines are also higher than ideal and Xiaopeng's previously announced three-quarter delivery target. This means that if the above delivery target is completed, NIO will need to achieve deliveries of 10,300 to 12,300 units in September.
"The second half of 2022 is a critical period for THE DELIVERY and RAMPAGE OF MANY NEW PRODUCTS, WHICH HAS BROUGHT HUGE CHALLENGES TO THE SUPPLY CHAIN, MANUFACTURING, QUALITY, DELIVERY AND SERVICE." Li Bin said that on the whole, he is still confident in the delivery of the fourth quarter and the completion of the annual target. In addition, he revealed that next year, Weilai will speed up the launch of new products.
After the release of the earnings report, the pre-market decline of NIO's U.S. stocks expanded to 6%. As of the close of trading on September 7, U.S. stocks rose 2.16% to $17.48 per share. As of the close of trading on the morning of September 8, NIO Hong Kong stocks rose 0.51% to HK$138.10 per share.
The sharp increase in expenses such as R&D expenses led to an increase in net loss in the second quarter
In terms of revenue, although the second quarter was about 700 units less than the first quarter, the vehicle sales revenue achieved a 3.5% sequential increase. Among them, the sales growth of the high-priced model ET7 has played a role in driving.
As the first sedan on NIO's NT2 platform, the ET7 officially opened for delivery in March this year, starting at a higher price than THE ES6 and EC6 previously launched by NIO; In the first full quarter, a total of 6,749 vehicles were delivered in the second quarter, second only to the ES6.
However, the increase in revenue did not lead to higher profits. NIO's gross profit fell to 1.59 billion yuan from 1.68 billion yuan in the first quarter, and the gross profit margin of vehicles fell by 1.4 percentage points to 16.7%. Weilai said in the financial report that the increase in battery costs, rising raw material prices and other factors have affected the gross profit margin of the vehicle.
Affected by factors such as the continuous rise in global raw material prices, NIO has announced price increases twice in April and May this year, involving ES8, ES6, ET7 and other models.
In the second quarter of this year, the net loss attributable to NIO's common shareholders was 2.745 billion yuan, an increase of 316.4% from the second quarter of 2021 and an increase of 50.4% from the first quarter of 2022.
"Big- and large-scale" R&D expenditure is still one of the important reasons for the loss of net profit. During the reporting period, NIO's R&D expenses were 2.15 billion yuan, an increase of 143.2% year-on-year, an increase of 22.0% month-on-month, a new single-quarter high, and also higher than Xiaopeng and Ideal's R&D expenses of 1.26 billion yuan and 1.53 billion yuan in the same period. Nio said in its earnings report that the increase in R&D investment was mainly due to the increase in personnel costs for the R&D function and the increase in the design and development costs of new products and technologies.
In the earnings call, Li Bin revealed that in core technology areas such as chips, NIO aims to establish full-stack self-research capabilities. "We believe that R&D investment in core technologies will not only increase our ability to cope with technological changes and risks in industrial policies, but also increase our gross profit margins over the long term, including the competitiveness of our technologies."
In addition, sales, general and administrative expenses increased by 52.4% year-on-year to MOP2.28 billion in the second quarter due to increased personnel costs and costs related to the expansion of sales and service networks, as well as increased marketing and promotion expenses (including those related to the listing of ES7).
Speeding up the "oil-to-electricity" requires more products to bring in more users
In the first half of this year, due to the supply chain pressure caused by the epidemic and the product transition period of the NT2 platform, WEILAI's monthly delivery was not stable. There have been months in a row of deliveries that have not been as good as Xiaopeng or Ideal.
On the earnings call, Li Bin admitted that in the third quarter of this year, Weilai's supply chain was indeed affected to a certain extent, but overall, the automobile supply chain was relatively controllable compared with the second quarter. In addition, in response to the "yield" problem encountered in vehicle production in the third quarter, NIO has also taken a variety of measures to solve the bottleneck of integrated die casting supply.
"The second half of 2022 is a critical period for NIO to expand production and deliver a number of new products." Li Bin said that ES7 has begun batch delivery in August; Deliveries of the ET5 will begin in September. In 2023, NIO will usher in a comprehensive replacement of products, and the existing ES8, ES6, ec6 will be fully switched to the NT2 platform.
In terms of the layout of the new mass market brand, Li Bin revealed that the research and development progress is proceeding as planned, and the NT3 platform will be used and will be followed by the NT3 platform to the market.
"We've recognized two things in the last year or two," he said. First, if we want to accelerate the transition from fuel trucks to trams, we do need more products in the price range to serve a wider range of users. We have also seen rapid growth in the penetration of entry-level, mass-market electric vehicles in China in the past year, which has increased the penetration rate of electric vehicles in China as a whole, which is the trend. On the other hand, we also see some interesting business models and opportunities for experience innovation. NIO is good at combining business models and technologies and experiencing innovation. We see these opportunities, including business models, technological innovations to serve a wider range of users. ”
In addition, Li Bin revealed that in addition to the layout of the European market, Weilai has been thinking about how to enter the US market since 2017. Over the past five years, we have been fully certified in all aspects, including products, user experience, business models, etc. "The U.S. is a very competitive market, and the regulatory system is very different from China and Europe. We are thinking long-term and patiently preparing. ”
Beijing News shell financial reporter Zhang Bing Editor Xu Chao Proofreader Lu Qian