Over the past months, $NIO has shown a fairly clear turnaround — the company has started delivering on its volume promises and accelerated expansion outside China, but the stock has reacted only lukewarmly because the market still doesn’t believe in long-term profitability. The story driving the company right now is mainly growth in delivered cars, the milestone of nearly a million vehicles on the road and entry into new markets (most recently Central Asia), plus building a fifth-generation swap-station network, which looks good marketing-wise — but an investor must ask whether there is sufficient gross margin and cost discipline behind it.

The positive part of the story: deliveries are growing almost 47% year-over-year, the company speaks of a volume growth target of 40–50% in 2026, gross margin has risen to roughly 14%, net loss is down about a third year-on-year, and they have over $5 billion in cash on the balance sheet. They also say they aim to reach adjusted profitability around the end of 2025 (which was achieved in the last quarter) and to be profitable for the full year 2026, which at the current valuation is why part of the market is starting to view NIO again as a “turnaround” story, not just another loss-making Chinese EV startup.

On the other hand, it is still a company that is aggressively investing in the swap-station network and global expansion (targeting up to 40 markets) and is preparing several new models and brands, which raises execution risk and capital demands. Competition in China and Europe continues to push prices down, so even though NIO tells a nice brand story—lifestyle and smart technology—the reality is still a fight for every percentage point of margin, and the market only partially believes it. You can see this in the stock: it has a positive performance over the past year, but in recent weeks it has mostly been hovering around $5.

My view: those already in NIO have finally been receiving concrete data in recent months that support the “turnaround” thesis—volume growth, better margins, an approaching inflection point. Those thinking about entering should realize this remains a pure growth, cyclical and politically risky bet on a Chinese EV maker where many things “have to go right at once” (expansion, new models, profitability), so it makes sense to size positions smaller and be prepared for high volatility around results.