NIO has secured a key stronghold.
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Author | Chai Xuchen
Editor | Zhou Zhiyu
Li Bin has ultimately fulfilled his promise from early 2025, capturing the crucial high ground of “Q4 profitability,” and stabilizing morale.
On February 5, NIO announced its profitability forecast. According to the announcement and a preliminary assessment based on the company's unaudited consolidated management accounts and information currently available to the board, NIO recorded its first single-quarter adjusted operating profit in Q4 2025. Based on non-GAAP accounting standards, NIO’s operating profit for the same period is expected to reach 200 million to 700 million RMB.
This means that, after a long period of investment, skepticism, and market games, NIO has finally broken the curse of losses and achieved the company's first quarterly adjusted operating profit since its founding. On the day before market opening, NIO’s US stock surged by more than 10 percentage points.
Looking back over the past few years, NIO has always been shadowed by the notion of “losing money on every car sold.” Huge R&D investments, the asset-heavy model of building a battery swapping network, and the high operational cost of user-centered services once gave it the label of “money-burning machine.” Many consumers hesitated to act because of these massive losses.
Last March, Li Bin exclaimed in an internal meeting, “The other kids have gotten into college, and we're still repeating a year!” He candidly stated that survival is the most important thing right now, and that fighting beautifully is not as important as winning. He set a mandate for Q4 profitability, started listening to advice publicly, correcting mistakes, and made a series of internal organizational adjustments, launching the CBU policy.
This year, the internal adjustments have borne fruit.
The new ES8 and the L90, with their high gross margins, sold like crazy. In December, thanks to the charging network, the NIO ES8 topped the charts, selling 22,258 units in one go, leaving the second place behind by more than 5,000 units. You should know, just a year ago, this market was dominated by “BBAL” (Benz, BMW, Audi, Li Auto) taking turns at the top. The once underrated Firefly also became a hit among small cars, quickly gaining ground in the personalized market.
It’s worth mentioning that NIO did not burn profits to gain market share, but found a balance between volume and profit. Li Bin said that with the mass delivery of the all-new ES8 and reductions in supply chain costs, Q4 auto gross margin is expected to rise to about 18%.
“If you look at our first-generation product cycle (2018–2021), we had annual growth of 100%. In the second-generation cycle (2022–mid-2025), growth didn't meet expectations. But starting from the delivery of the third-generation products (L90 onwards), rapid growth resumed.” Li Bin told WallStreet.cn that the company has entered the harvesting period and NIO's growth engine is reignited.
At the same time, the reforms at the beginning of last year are showing results, allowing NIO to move ahead lightly. After integrating the single-channel LeDao into the main NIO brand, channels are now shared; and for R&D expenses, NIO has already completed the basic R&D work for the NT3.0 platform, so subsequent R&D investments have returned to normal levels.
Seven years ago, Musk slept in the factory and saved Tesla through firm cost control and production capacity breakthroughs. Now, Li Bin is experiencing positive feedback in innovation, system sorting, and cost-cutting, entering a “state of boundless joy.”
After being doubted multiple times about “how long it could last,” NIO delivered its 1 millionth production vehicle a month ago, officially joining the million-vehicle club. In the camp of new car makers, this moment may carry more weight than any previous million-vehicle celebration by others.
Li Bin admits, "Ever since NIO started, it feels like entering an endless game, a marathon on a muddy road—it's very hard." Fortunately, NIO has kept up with the main pack through several rounds of industry reshuffling.
As NIO co-founder Qin Lihong said, one million vehicles is an important milestone for a company's growth, and also a key indicator of its potential for long-term survival. It means NIO has truly entered the championship circle. For NIO, which has faced life-or-death moments, this is a reward for "long-termism."
Although NIO has captured the "key high ground" of single-quarter profitability, Li Bin and the management remain highly cautious. They understand that the auto industry competition is a never-ending marathon—a single quarter’s victory does not guarantee survival.
The market environment in 2026 will be even more perilous than in 2025.
On one hand, the Huawei-backed HarmonyOS Smart Mobility Alliance is going all out, with product lines that highly overlap with NIO and possessing powerful smart driving capabilities and channel advantages. On the other hand, traditional luxury brands, after struggling with electrification, are launching steep price cuts and new platform product counterattacks.
Against this background, NIO's Q4 2025 profitability seems more like an “entry ticket,” qualifying it for the next, even harsher championship round. The challenge ahead is whether NIO can make quarterly profitability the norm.
Li Bin also admits that the 2025 final is only the beginning, and relative stability may not emerge until around 2035. “We’re very lucky to be in the finals now. Although we've experienced the lows of the past three years, we've also learned a lot. I hope NIO's second decade will be spent building solid operations, striving to take a leading role in these finals.”
Next, NIO will aim for the full-year profitability target under non-GAAP standards in 2026. NIO faces three major challenges. First is the sustainability of sales. The new car effect usually has a window period; whether the L90 and new ES8 can stay hot amid fierce competition depends on NIO’s OTA upgrade capabilities and service stability.
Second is the strategic synergy of LeDao and Firefly. While mass market brands can bring scale, they may also lower overall gross margins. How to balance the relationship between the main and sub-brands and avoid internal competition is a problem Li Bin needs to solve.
No matter how rough the road ahead, the report card NIO delivered in Q4 2025 holds the bottom line of the premium strategy it pursued for years. Li Bin, this 30-year veteran entrepreneur, finally seems poised for success.
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