Shares of Chinese electric vehicle maker Nio Inc. (NIO) popped on Tuesday, and it's not hard to see why. The company just reported a fiscal fourth quarter that was, in a word, explosive. Higher deliveries, fatter margins, and a surprising turn toward profitability—it's the kind of report that makes Wall Street sit up and take notice.
Let's start with the headline numbers. Revenue came in at 34.65 billion yuan, which is about $4.95 billion. That's a 75.9% jump from a year ago and a solid beat over the $4.61 billion analysts were expecting. But the real stunner was on the bottom line. Excluding one-time items, Nio reported adjusted earnings of 0.29 yuan per American Depositary Share (ADS), or about 4 cents. That's a dramatic reversal from a loss of 3.17 yuan per ADS this time last year, and it crushed expectations for a 5-cent loss. When you beat estimates by going from a predicted loss to an actual profit, people tend to get excited.
This performance was fueled by a big jump in deliveries. Nio delivered 124,807 vehicles in the quarter, up 71.7% year-over-year. That pushed vehicle revenue up by an even more impressive 80.9%. For context, while Nio is often called the "Tesla of China," its domestic rival Tesla Inc. (TSLA) delivered a record 418,227 vehicles globally in Q4, though that figure was down 16% from the prior year. Nio's momentum has carried into the new year, with 27,182 vehicles delivered in January and 20,797 in February 2026. As of the end of February, the company's cumulative deliveries have crossed the 1.04 million mark.
Perhaps the most encouraging sign for investors was the margin expansion. Profitability is the name of the game in the capital-intensive EV world, and Nio showed real progress. Gross margin climbed to 17.5%, up from 11.7% a year ago and 13.9% in the prior quarter. The vehicle margin was even healthier at 18.1%. Management attributed the improvement mainly to a more favorable product mix—selling more of the good stuff. The company also ended the year with a strong balance sheet, holding 45.9 billion yuan ($6.6 billion) in cash, cash equivalents, and various investments.
On the earnings call, Founder and CEO William Bin Li was bullish on the product lineup. He said the All-New ES8 set a monthly delivery record for vehicles priced above 400,000 yuan, the ONVO L90 became the best-selling large battery-electric SUV in China for 2025, and the Firefly model continued to lead the premium small car segment. He also highlighted that internally developed smart EV tech had reached mass production, helping both product competitiveness and cost reduction. Looking to 2026, Li said the plan is to keep investing in core tech, launch new models, and expand the battery-swap and charging network.
CFO Stanley Yu Qu pointed to a significant milestone: the company recorded its first-ever adjusted operating profit in a single quarter, coming in at 1.25 billion yuan. It's a symbolic moment that suggests the business model is working.
But what really has the market buzzing is the outlook. For the first quarter of 2026, Nio expects to deliver between 80,000 and 83,000 vehicles. That represents year-over-year growth of roughly 90% to 97%. They're forecasting revenue in the range of 24.48 billion to 25.18 billion yuan ($3.50 billion to $3.60 billion). That implies growth of 103% to 109% compared to Q1 2025 and, importantly, sails past the analyst consensus estimate of $2.97 billion. When you guide that far above expectations, it tells investors you have serious momentum.
The market's reaction was immediate. Nio shares were up over 7% in premarket trading following the report. After a quarter like this—with beats on the top and bottom lines, expanding margins, a profit milestone, and bullish guidance—it seems investors are starting to believe that Nio might finally be turning the corner.
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