Al Root

NIO stock fell early Wednesday after the company disclosed plans to raise money, benefiting from recent gains in the share price.

The Chinese electric vehicle maker's American depositary receipts were down 8.1% at $5.77, while S&P 500 futures were up 0.3% and Dow Jones Industrial Average futures were down 0.2%.

The company said it plans to sell about 182 million shares of common stock. Underwriters have the option to sell an additional 27 million shares, depending on demand, a feature of most equity offerings.

NIO said it would use the money to "invest in the research and development of core technologies for smart electric vehicles, develop future technology platforms and vehicle models across its brands, expand its battery swapping and charging network, further strengthen its balance sheet, and for general corporate purposes."

Cash is still king for the EV start-up, even though its balance sheet is in relatively good shape. NIO ended the second quarter with about $3.8 billion in cash. Wall Street sees the company using $1.6 billion in 2025, with positive free cash flow forecast for 2026.

Over its life, NIO has spent more than $10 billion starting its EV business.

The equity raising allows the company to cash in on gains in the stock. Coming into Wednesday trading, NIO stock was up 65% over the past three months, boosted by strengthening sales, new model introductions, and Wall Street upgrades.

Through August, NIO delivered 166,472 EVs, up 30% over the same span of 2024.

NIO shares have been up recently, but investors don't seem to feel like they once did. The ADRs peaked at $66.99 in November 2021.

Write to Al Root at allen.root@dowjones.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

September 10, 2025 08:57 ET (12:57 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.