Nio Inc. strengthened its balance sheet in the first quarter of 2026, with net current assets turning positive and cash reserves climbing as the Shanghai-headquartered EV maker seeks its first full year of profitability.
The company said its net current assets turned positive as of March 31, and that it generated positive operating cash flow and an adjusted net profit during the quarter, “despite recording a net loss under GAAP.”
Cash and cash equivalents, restricted cash, short-term investments and long-term time deposits stood at 48.2 billion yuan ($7.0 billion) at the end of the quarter, up from 45.9 billion yuan three months earlier and from 26.0 billion yuan a year ago.
The improvement marks a striking turn for a company that came within weeks of collapse in 2019, just before the Covid-19 pandemic.
A Loss on Paper, Cash in the Bank
Nio reported a net loss of 332.1 million yuan ($48.1 million) for the quarter, reversing the first quarterly profit in its history, which it had posted in the final three months of 2025.
The reversal was driven largely by seasonality, as first-quarter deliveries of 83,465 vehicles fell 33.1% from the fourth quarter’s record, leaving a smaller revenue base over which to spread fixed costs.
Total revenue still rose 112.2% from a year earlier to 25.53 billion yuan ($3.7 billion), and the vehicle margin climbed to 18.8%, its highest in years.
Yet the company remained profitable on an adjusted basis, posting a non-GAAP net profit of 43.5 million yuan ($6.3 million), and its underlying cash generation stayed positive.
Nio lost money on paper while continuing to add to its reserves.
The Balance-Sheet Turnaround
The positive net current asset position means Nio’s current assets now exceed its current liabilities — a measure of short-term financial health that had long sat in negative territory.
The company had still reported negative net current assets at the end of 2025, even after posting its first quarterly operating profit.
Current liabilities exceeded current assets by about 1.95 billion yuan on December 31, before the position swung to a surplus of roughly 736 million yuan three months later.
The shift was driven by a combination of higher vehicle margins, disciplined working-capital management under Nio’s Core Business Unit (CBU) framework established in early 2025, and continued cash generation from operations.
On its fourth-quarter earnings call in March, founder and CEO William Li said Nio had delivered positive free cash flow for two consecutive quarters and positive operating cash flow for the full year of 2025.
CFO Stanley Yu Qu said at the time that the company had ended 2025 with a stronger balance sheet, a trajectory that continued into the first quarter.
The improved product mix, anchored by the high-priced ES8 SUV, lifted the company’s average selling price, which climbed to roughly 273,000 yuan in the first quarter.
Nio’s new flagship ES9 SUV, which begins deliveries on May 27 and sits above the ES8 on price, is positioned to push the mix and margins higher still in the current quarter.
From the Brink of Collapse
The financial stability stands in sharp contrast to the existential crisis Nio faced at the end of the last decade.
Through 2019, the company burned through cash at an unsustainable rate, and by late that year its bank balance was approaching zero.
Analysts at Sanford C. Bernstein described the stock at the time as “a binary option on a bailout,” warning that without fresh funding the company faced insolvency.
Nio had survived earlier in 2019 only through a $200 million convertible note issued to Li and early backer Tencent, and the situation worsened as the Covid-19 pandemic froze China’s economy in early 2020.
The lifeline came from the municipal government of Hefei, in eastern China’s Anhui province. In April 2020, Hefei-backed investors injected 7 billion yuan — about $1 billion — in exchange for a strategic stake, a deal that moved Nio’s China headquarters to the city and pulled the company, in the words of one investor involved, “back from the ICU.”
Nio more than doubled deliveries in 2020, and by early 2021 its market value had briefly topped $100 billion when the stock reached its all time high at $66.99.
The years since brought fresh pressure — a brutal domestic price war, thinning margins, and the cost of building three brands and a battery-swap network — but the company has been steadily rebuilding its financial footing.
Sufficient Resources for the Year Ahead
In its going-concern assessment, Nio said its available cash, restricted cash, short-term investments, cash from operations and funds from credit lines would be sufficient to support its operations for the next twelve months.
The assessment weighed its business plan, including revenue growth from existing and new models, continued efficiency gains, working-capital management and its ability to draw on bank credit when needed.
Nio has guided for second-quarter deliveries of between 110,000 and 115,000 vehicles, a year-over-year increase of 52.7% to 59.6%, with revenue expected to rise as much as 81.2% from a year earlier.
Li warned in March of mounting external cost pressure in 2026, citing rising prices for lithium, chips and copper, and China’s premium electric-vehicle market faces intensifying competition.
The company has recently reaffirmed its target of achieving its first full year of non-GAAP operating profitability in 2026, but has acknowledged that the path depends on holding margins as those input costs climb.
