Jeff

Jeff asked about the Q4 average selling price (ASP), noting that the RMB 34 billion revenue guidance implies a 12% quarter-over-quarter ASP increase to RMB 246,000, and if an 18% gross vehicle margin would result in RMB 6 billion gross profit. He also inquired about the Q1 next year volume and vehicle margin outlook, considering Q4's high-margin products and the expectation that Q1 volume won't drop to Q3 levels.

Answer

CEO William Li confirmed that the Q4 ASP would increase, primarily driven by sales of the high-margin ES8, with most of the 40,000 full-year ES8 units expected in Q4. Regarding Q1 next year, he stated that while it's typically a low season, the impact from Q4 this year to Q1 next year would not be as significant as in previous years due to the absence of a typical Q4 sales spike and the existing ES8 order backlog. He projected Q1 next year's operations and volume to be lower than Q4 this year but better than Q1 last year, with vehicle gross margin following a similar trend (lower than Q4 this year but better than Q1 last year).

Jeff from Citi asked about the Q4 2025 average selling price (ASP) of RMB 246,000, correlating it with the RMB 34 billion revenue guidance and an 18% gross vehicle margin, which would imply RMB 6 billion in gross profit. He also questioned the outlook for Q1 2026, specifically if volume would avoid dropping to Q3 2025 levels, if high-margin product mix would improve, and if vehicle margin could stay near 18%.

Answer

William Li, Founder, Chairman, and CEO of NIO, confirmed that the Q4 ASP would increase due to a higher proportion of high-priced ES8 deliveries, with most of the 40,000 full-year ES8 target delivered in Q4. He acknowledged Q1 2026 as a low season but noted that the impact would be less severe than in previous years due to reduced Q4 seasonality and ES8 order backlogs. While Q1 2026 vehicle gross margin would likely be lower than Q4 2025, it would be significantly better than Q1 2025.

Asked about managing the grade 3 diarrhea rate for CX-2051, including alternative strategies beyond loperamide. Also inquired about the expected median follow-up in the Q1 update and plans for presenting at ASCO GI 2026.

Answer

Diarrhea is a key adverse event being managed. Prophylactic loperamide has been implemented, which was not used in the early part of the study. The company is focused on this strategy first. Regarding the Q1 update, they expect 'decent follow-up' on the majority of the ~70 patients but cannot provide a specific number. They are keeping all options open for the presentation venue and cannot comment on ASCO GI 2026 specifically.