NIO stock is drawing attention as the EV maker prepares to announce its fourth-quarter results before the U.S. market opens on Friday, Mar 21. So far, NIO stock has gained 12% this year.

Three Things to Watch Before Earnings Report

NIO’s Q4 Losses Likely Widened

According to Bloomberg’s unanimous expectations, NIO to post revenue of 20.13 billion yuan for 2024Q4; Adjusted EPS is estimated to be -2.60 yuan. Nio's 4Q operating loss could have widened vs. 3Q's 5.2 billion yuan. Vehicle deliveries were up 18% sequentially, yet average selling prices maybe 5-10% lower, as the cheaper Onvo brand accounted for 27% of unit sales. A less favorable product mix likely curbed gross margin gains despite narrower retail discounts and higher plant utilization. Higher costs from Onvo's sales channel and battery-swapping stations" development could have weighed on the bottom line.

Nio's 2025 focus would be ramping up its Onvo brand to help boost scale and cut supply-chain costs. Yet, competition remains fierce, and its first two months' sales got off to a slow start. Management's target of doubling vehicle deliveries this year looks rather aggressive, and shrinking its losses could be difficult.

Domestic Competition Still A Strong Profitability Headwind

it is critical to recognize that NIO operates in one of the most fiercely competitive EV markets globally: China. While China remains the largest EV market, domestic competition is heating up at an unsustainable pace. NIO is up against a relentless wave of rivals, including BYD, XPeng, and Li Auto, all of which are cutting prices and expanding production.

With 211,567 deliveries in 2024, NIO's dwarfed by BYD (4.27M), XPeng (190K), and Li Auto (500K) in China's highly competitive market, where sales dipped 12% YoY in January 2025. Moreover, global EV demand is cooling, while EU and U.S. tariffs strangle NIO's expansion in two very attractive auto markets.

William Li Details How Nio Should Control Costs in Internal Speech

The company's CEO William Li said Nio is aiming for single-quarter profitability in the fourth quarter and needs to become more rational in cost control, resource allocation, and priority setting.

Li gave the internal speech to all employees on March 14, detailing the core logic of the CBU mechanism. He asked employees to change the unjustifiable practices of the past as soon as possible, emphasizing efficiency and delivering business goals.

Nio has 12 CBUs, and the units that spend the most money include the research and development team's more than RMB 100 ($1.4 billion) a year, the marketing department's billions of RMB a year, and large staff costs, Li said.

"We need to answer the question of what effect these investments are actually producing, and then we need to do it by saving money where we should save money and spending money where we should spend it," he said.

Options Strategies to Trade NIO’s Earnings

Given NIO’s elevated implied volatility (109.36%), earnings are likely to trigger significant price swings. Below are actionable strategies based on real-time options data:

Source: Tiger Trade App

1. Bear Put Spread

Structure:

• Buy NIO $5.00 Put

• Sell NIO $4.50 Put

  $NIO Vertical 250321 4.5P/5.0P$

Rationale:

• Hedges against downside toward support ($4.45).

• Max Profit: $26.50

• Breakeven: $4.76

  Source: Tiger Trade App

2. Bull Call Spread

Structure:

• Buy NIO $5.00 Call

• Sell NIO $5.50 Call

  $NIO Vertical 250321 5.0C/5.5C$

Rationale:

• Targets a breakout above resistance ($4.93) toward $5.50.

• Net debit (cost) is minimized by selling the higher strike call.

• Max Profit: $36

• Breakeven: $5.14

  Source: Tiger Trade App