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Nio sees first ever positive cash flow in Q2 | Updated: 2020-08-12 09:09
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A Nio ES6 model is displayed at the Chengdu auto show. [Photo by Cao Yingying/China Daily]

Chinese electric car startup Nio saw its first ever positive cash flow from operations in the second quarter this year since its establishment in 2014, said its founder and CEO William Li on Tuesday.

According to the company's financial statements, its gross margin was 8.4 percent in the quarter, and the gross profit stood at $44.3 million. In the same period last year, Nio recorded a loss of $72.5 million.

Li said Nio also witnessed a record-high vehicle margin of 9.7 percent and its lowest-ever operating losses in the quarter, which were $164.2 million.

The company's total revenues were $526.4 million in the quarter, representing a 146.5 percent surge from the same period last year.

Nio delivered a record-high 10,331 vehicles in the second quarter, up 191 percent from the same period last year. The company expects to sell 11,000 to 11,500 vehicles in the third quarter, which will be an increase of 6.5 percent to 11.3 percent from the second quarter.

"The current constraints on production will be lifted in the near future and we are confident that our production capacity can meet the accelerated demand for our models," Li said.

Nio expects revenues in the third quarter to reach $572.9 million to $596.2 million, representing an increase of approximately 8.8 percent to 13.3 percent from the second quarter of 2020.

Feng Wei, Nio's chief financial officer, said the vehicle margin in the second quarter "significantly" exceeded its target of over 5 percent, which was attributed to the increasing scale, higher average revenue per vehicle, reduced material costs and improved manufacturing efficiency.

"We have demonstrated our capabilities to generate positive cash flow from operations," Feng said. "We will continue to enhance our efficiencies across the company in the rest of 2020 and beyond."

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