Chinese EV maker Nio $NIO ( ▲ 5.86% ) just teased a milestone it has been chasing for years: profitability. The company said it expects to post its first-ever quarterly profit in Q4, a sharp turnaround from the losses Wall Street had penciled in.
Shares jumped in premarket trading after Nio projected adjusted operating profit between $100 million and $172 million for the quarter. Analysts had been expecting a loss of about $19 million. That gap is the difference between “still burning cash” and “maybe this business model actually works.”
Volume is finally doing the heavy lifting
The biggest driver was simple: Nio sold a lot more cars. The company delivered nearly 125,000 vehicles in the fourth quarter, up 72% from a year earlier. Higher volumes help spread fixed costs like factories, R&D, and overhead across more units, which can quickly change the math for margins.
Nio also said it improved vehicle margins and cut costs. In a brutally competitive Chinese EV market where price wars have crushed profitability, even small efficiency gains can have an outsized impact.
From growth story to profit story?
For years, Nio has been treated like a pure growth play, with investors willing to overlook losses in exchange for rapid expansion. But sentiment around EV startups has shifted as funding gets tighter and competition intensifies.
If Nio can actually string together consistent profits, it starts to look less like a cash-hungry startup and more like a maturing automaker. That would mark a major narrative shift for the stock and could help it stand out in a crowded field of EV makers still struggling to prove they can make money, not just cars.