The following discussion of our financial condition and results of operations is based upon and should be read in conjunction with our consolidated financial statements and their related notes included elsewhere in this annual report. This annual report contains forward-looking statements. See “Forward-Looking Information.” In evaluating our business, you should carefully consider the information provided under the caption “Item 3. Key Information—D. Risk Factors” in this annual report. We caution you that our businesses and financial performance are subject to substantial risks and uncertainties. A. Operating Results Overview We are a pioneer and a leading company in the global smart electric vehicle market. We aspire to shape a sustainable and brighter future with the mission of “Blue Sky Coming”. We envision ourselves as a user enterprise where innovative technology meets experience excellence. We design, develop, manufacture and sell smart electric vehicles, driving innovations in next-generation core technologies. We distinguish ourselves through continuous technological breakthroughs and innovations, exceptional products and services, and a community for shared growth. We provide premium smart electric vehicles under the NIO brand, family-oriented smart electric vehicles through the ONVO brand, and small smart high-end electric cars with the FIREFLY brand. In 2025, we delivered 326,028 vehicles, including 178,806 vehicles from our premium smart electric vehicle brand NIO, 107,808 vehicles from our family-oriented smart electric vehicle brand ONVO, and 39,414 vehicles from our small smart high-end electric car brand FIREFLY. Key Line Items Affecting Our Results of Operations Revenues The following table presents our revenue components by amount and as a percentage of the total revenues for the periods indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31 ​ ​ 2023 ​ 2024 ​ 2025 ​ ​ ​ ​ RMB ​ ​ ​ % ​ ​ ​ RMB ​ ​ ​ % ​ ​ ​ RMB ​ ​ ​ US$ ​ ​ ​ % ​ (in thousands) Revenues: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Vehicle sales 49,257,270 ​ 88.6 58,234,086 ​ 88.6 76,883,876 10,994,248 ​ 87.9 Other sales(1) 6,360,663 ​ 11.4 7,497,473 ​ 11.4 10,603,634 1,516,299 ​ 12.1 Total revenues 55,617,933 ​ 100.0 65,731,559 ​ 100.0 87,487,510 12,510,547 ​ 100.0 Note: (1) Other sales are comprised as below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31 ​ ​ 2023 ​ 2024 ​ 2025 ​ ​ ​ ​ RMB ​ ​ ​ % ​ ​ ​ RMB ​ ​ ​ % ​ ​ ​ RMB ​ ​ ​ US$ ​ ​ ​ % ​ ​ (in thousands) Other sales ​ ​ ​ ​ ​ ​ ​ Parts, accessories and after-sales vehicle services ​ 2,337,490 ​ 4.2 ​ 3,324,321 ​ 5.1 ​ 4,174,135 ​ 596,893 ​ 4.8 Provision of power solutions ​ 1,666,346 ​ 3.0 ​ 2,100,553 ​ 3.2 ​ 2,464,441 ​ 352,410 ​ 2.8 Others ​ 2,356,827 ​ 4.2 ​ 2,072,599 ​ 3.1 ​ 3,965,058 ​ 566,996 ​ 4.5 Total 6,360,663 11.4 7,497,473 11.4 10,603,634 1,516,299 12.1 ​ 115 Table of Contents We currently generate revenues from vehicle sales, which represent revenues from sales of new vehicles, and other sales including (a) parts, accessories and after-sales vehicle services, including repair, maintenance, extended warranty services, service package and other vehicle-related services, (b) provision of power solutions, including provision of battery charging and swapping services, sales of charging piles, provision of BaaS-related services and other power solution services, (c) others, which mainly consist of technical services, used car sales, auto financing services, sales of lifestyle product merchandise and other products and services. Cost of Sales The following table presents our cost of sales components by amount and as a percentage of our total cost of sales for the period indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31 ​ ​ 2023 ​ 2024 ​ 2025 ​ ​ ​ ​ RMB ​ ​ ​ % ​ ​ ​ RMB ​ ​ ​ % ​ ​ ​ RMB ​ ​ ​ US$ ​ ​ ​ % ​ ​ (in thousands) Cost of Sales: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Vehicle sales (44,587,572) ​ 84.8 (51,094,616) ​ 86.3 (65,670,810) (9,390,801) ​ 86.9 Other sales (7,978,565) ​ 15.2 (8,144,181) ​ 13.7 (9,900,995) (1,415,823) ​ 13.1 Total cost of sales (52,566,137) ​ 100.0 (59,238,797) ​ 100.0 (75,571,805) (10,806,624) ​ 100.0 ​ We incur cost of sales in relation to (i) vehicle sales, including parts, materials, processing fee, labor costs, manufacturing cost (including depreciation of assets associated with the production), losses on production related purchase commitments, warranty expenses, and inventory write-downs, and (ii) other sales, including parts, materials, labor costs, vehicle connectivity cost, and depreciation of assets that are associated with sales of service and others. Operating Expenses Research and Development Expenses Research and development expenses consist primarily of (i) employee compensation, representing salaries, benefits and bonuses as well as share-based compensation expenses for our research and development staff and (ii) design and development expenses, which include, among others, consultation fees, outsourcing fees and expenses of testing materials. Our research and development expenses also include travel expenses, depreciation and amortization of equipment used in relation to our research and development activities, rental and related expenses with respect to laboratories and offices for research and development teams and others, which primarily consists of telecommunication expenses, office fees and freight charges. Our research and development expenses are mainly driven by the number of our research and development employees, the stage and scale of our vehicle development and development of technology. Selling, General and Administrative Expenses Our selling, general and administrative expenses mainly include (i) employee compensation, including salaries, benefits and bonuses as well as share-based compensation expenses with respect to our sales, marketing and general corporate staff, (ii) marketing and promotional expenses, which primarily consist of marketing and advertising costs, (iii) rental and related expenses, which primarily consist of rental for physical stores and offices, (iv) professional service expenses, which consist of outsourcing fees primarily relating to legal and human resources and IT functions, design fees paid for physical stores and offices and fees paid to auditors, (v) depreciation and amortization expenses, primarily consisting of depreciation and amortization of leasehold improvements, IT equipment and software, among others, (vi) expenses of low value consumables, primarily consisting of, among others, IT consumables, office supplies, sample fees and IT-system related licenses, (vii) traveling expenses, and (viii) other expenses, which includes telecommunication expenses, utilities and other miscellaneous expenses. 116 Table of Contents Our selling, general and administrative expenses are significantly affected by the number of our non-research and development employees, marketing and promotion activities and the expansion of our sales and after-sales network, including NIO Houses, NIO Spaces and other leased properties. Interest and Investment Income Interest and investment income primarily consists of interest and gain earned on cash deposits, short-term investment and long-term investment. Gain/(Loss) on Extinguishment of Debt Gain or loss on extinguishment of debt consists of gain or loss derived from repurchase of convertible notes. Interest Expense Interest expense primarily consists of interest expense with respect to our indebtedness and finance lease liabilities. Share of Income/(Loss) of Equity Investees Share of income or loss of equity investees primarily consists of our share of the losses, net of shares of gains of our investees in which, as of December 31, 2025, we held 1.0% to 51.0% in related equity interests. Our equity interests are accounted for using the equity method since we exercise significant influence but do not own a majority equity interest in or control those investees. For investees in which we held equity interest less than 20%, we can exercise significant influence over investees through participation and voting rights in the board of directors or investment committee. For investee in which we held equity interest of 51.0%, we cannot control the significant financial and operating decisions of this investee at our discretion according to the corporate government documents. Our share of income/(loss) of equity investees also includes the elimination of the unrealized intercompany profit in upstream and downstream transactions. Other Income/(Loss), Net Other income or loss primarily consist of foreign exchange gains or losses we incur based on movements between the U.S. dollar and the Renminbi. Other income also includes income from reimbursement from depository bank. Income Tax Expense Income tax expense primarily consists of current income tax expense, mainly attributable to intra-group income earned by our United States, German, UK, Hong Kong and PRC subsidiaries which are eliminated upon consolidation but were subject to tax in accordance with applicable tax law, and deferred income tax expense, recognized for the tax consequences attributable to differences between carrying amounts of existing assets and liabilities in the financial statements and their respective tax basis, and operating loss carry-forwards. Taxation Cayman Islands We are incorporated in the Cayman Islands. The Cayman Islands currently has no form of income, corporate or capital gains tax. There are no other taxes likely to be material to us levied by the government of the Cayman Islands except for stamp duties which may be applicable on instruments executed in, or, after execution, brought within the jurisdiction of the Cayman Islands. Hong Kong Subsidiaries incorporated in Hong Kong are subject to 8.25% profit tax on the first HK$2 million taxable income and 16.5% profit tax on the remaining taxable income generated from operations in Hong Kong. There is no withholding tax in Hong Kong on remittance of dividends. 117 Table of Contents PRC Generally, our PRC subsidiaries are subject to enterprise income tax on their taxable income in China at a statutory rate of 25%, except for our certain PRC subsidiaries that are qualified as high and new technology enterprises under the PRC Enterprise Income Tax Law and are eligible for a preferential enterprise income tax rate of 15%. The enterprise income tax is calculated based on the entity’s global income as determined under PRC tax laws and accounting standards. Our products and services are primarily subject to value-added tax at a rate of 13% on the vehicles and charging piles, repair and maintenance services and charging services as well as 6% on services such as research and development services, in each case less any deductible value-added tax we have already paid or born. We are also subject to surcharges on value-added tax payments in accordance with PRC law. Dividends paid by our PRC subsidiaries in China to our Hong Kong subsidiaries will be subject to a withholding tax rate of 10%, unless the Hong Kong entity satisfies all the requirements under the Arrangement Between the Mainland of China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital and receives approval from the tax authority. If our Hong Kong subsidiaries satisfy all the requirements under the tax arrangement and receive approval from the tax authority, then the dividends paid to the Hong Kong subsidiaries would be subject to withholding tax at the standard rate of 5%. Effective from November 1, 2015, the above-mentioned approval requirement has been abolished, but a Hong Kong entity is still required to file application package with the tax authority, and settle the overdue taxes if the preferential 5% tax rate is denied based on the subsequent review of the application package by the tax authority. If NIO Inc. or any of our subsidiaries outside of China were deemed to be a “resident enterprise” under the PRC Enterprise Income Tax Law, it would be subject to enterprise income tax on its worldwide income at a rate of 25%. Under the PRC Enterprise Income Tax Law, research and development expenses incurred by an enterprise in the course of carrying out research and development activities that have not formed intangible assets are included in the profit and loss account for the current year. Besides deducting the actual amount of research and development expenses incurred, an enterprise is allowed an additional 100% deduction of the amount in calculating its taxable income for the relevant year. For research and development expenses that have formed intangible assets, the tax amortization is based on 200% of the costs of the intangible assets. Recently Issued Accounting Pronouncements For a summary of recently issued accounting pronouncements, see Note 3 to our consolidated financial statements included elsewhere in this annual report. 118 Table of Contents Results of Operations The following table sets forth a summary of our consolidated results of operations for the periods indicated. This information should be read together with our consolidated financial statements and related notes included elsewhere in this annual report. The operating results in any year are not necessarily indicative of the results that may be expected for any future periods. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2023 ​ 2024 ​ 2025 ​ RMB RMB RMB US$ ​ (in thousands) Revenues:(1) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Vehicle sales 49,257,270 58,234,086 76,883,876 10,994,248 Other sales(3) 6,360,663 7,497,473 10,603,634 1,516,299 Total revenues 55,617,933 65,731,559 87,487,510 12,510,547 Cost of sales:(2) ​ ​ ​ ​ Vehicle sales (44,587,572) (51,094,616) (65,670,810) (9,390,801) Other sales (7,978,565) (8,144,181) (9,900,995) (1,415,823) Total cost of sales (52,566,137) (59,238,797) (75,571,805) (10,806,624) Gross profit 3,051,796 6,492,762 11,915,705 1,703,923 Operating expenses:(2) ​ ​ ​ ​ Research and development(2) (13,431,399) (13,037,304) (10,604,993) (1,516,494) Selling, general and administrative(2) (12,884,556) (15,741,057) (16,087,747) (2,300,517) Other operating income, net ​ 608,975 ​ 411,526 ​ 735,797 ​ 105,218 Total operating expenses (25,706,980) (28,366,835) (25,956,943) (3,711,793) Loss from operations (22,655,184) (21,874,073) (14,041,238) (2,007,870) Interest and investment income 2,210,018 853,728 761,658 108,916 Interest expenses (403,530) (798,363) (885,248) (126,589) Gain/(loss) on extinguishment of debt ​ 170,193 ​ (4,480) ​ (14,660) ​ (2,096) Share of income/(loss) of equity investees ​ 64,394 (503,193) (1,092,184) (156,180) Other income/ (loss), net ​ 155,191 (98,143) 450,953 64,485 Loss before income tax expense ​ (20,458,918) ​ (22,424,524) ​ (14,820,719) ​ (2,119,334) Income tax (expense)/benefit ​ (260,835) ​ 22,815 ​ (121,882) ​ (17,429) Net loss ​ (20,719,753) ​ (22,401,709) ​ (14,942,601) ​ (2,136,763) Other comprehensive (loss)/income ​ ​ ​ ​ ​ ​ ​ ​ Change in unrealized losses related to available-for-sale debt securities, net of tax ​ (770,560) ​ — ​ — ​ — Foreign currency translation adjustment, net of nil tax ​ 11,514 ​ 149,668 ​ (2,860) ​ (409) Total other comprehensive (loss)/ income ​ (759,046) ​ 149,668 ​ (2,860) ​ (409) Total comprehensive loss ​ (21,478,799) ​ (22,252,041) ​ (14,945,461) ​ (2,137,172) Accretion on redeemable non-controlling interests to redemption value (303,163) (347,516) (609,857) (87,208) Net (profit)/loss attributable to non-controlling interests ​ (124,051) 91,533 (18,220) (2,605) Other comprehensive loss attributable to non-controlling interests ​ 156,026 — — — Comprehensive loss attributable to ordinary shareholders of NIO Inc. (21,749,987) (22,508,024) (15,573,538) (2,226,985) Notes: (1) We currently generate revenues from vehicle sales and other sales. (2) Share-based compensation expenses were allocated in cost of sales and operating expenses as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cost of sales ​ ​ ​ 83,972 ​ ​ ​ 71,779 ​ ​ ​ 57,954 ​ ​ ​ 8,287 Research and development expenses 1,517,206 1,296,136 1,129,859 161,568 Selling, general and administrative expenses 767,863 560,597 602,914 86,216 Total 2,369,041 1,928,512 1,790,727 256,071 (3) Other sales mainly consist of revenues from (a) parts, accessories and after-sales vehicle services, including repair, maintenance, extended warranty services, service package and other vehicle-related services, (b) provision of power solutions, including provision of battery charging and swapping services, sales of charging piles, provision of BaaS-related services and other power solution services, (c) others, which mainly consist of technical services, used car sales, auto financing services, sales of lifestyle product merchandise and other products and services. 119 Table of Contents Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 Revenues Our revenues increased by 33.1% from RMB65,731.6 million in 2024 to RMB87,487.5 million (US$12,510.5 million) in 2025, primarily attributable to (i) an increase in vehicle sales by RMB18,649.8 million, as a result of an increase in vehicle delivery volume by 46.9% from 221,970 vehicles in 2024 to 326,028 vehicles in 2025, partially offset by a decrease in the average selling price of our vehicles mainly due to changes in product mix. In 2025, following the commencement of deliveries of firefly and NIO All-New ES8, the starting manufacturer’s suggested retail price (MSRP) of our mainstream models in China ranged from RMB119,800 to RMB406,800, compared with RMB206,900 to RMB358,000 in 2024, and (ii) an increase in other revenues by RMB1,213.7 million from sales of parts, accessories and after-sales vehicle services as well as the provision of power solutions, driven by continued growth in our user base, and (iii) the increase in sales of used cars and provision of technical services by RMB1,758.3 million. Cost of sales Our cost of sales increased by 27.6% from RMB59,238.8 million in 2024 to RMB75,571.8 million (US$ 10,806.6 million) in 2025, primarily attributable to (i) an increase in cost of vehicle sales by RMB14,576.2 million, as a result of an increase in vehicle delivery volume by 46.9%, partially offset by changes in our product mix and lower material cost per vehicle, (ii) the increase in cost of used car sales of RMB1,159.6 million, as a result of increased used car sales volume, and (iii) an increase in cost of provision of power solutions by RMB461.0 million, mainly as a result of higher depreciation and operating cost from the increased investment in our power network. Gross Profit and Gross Margin Our gross profit increased by 83.5% from RMB6,492.8 million in 2024 to RMB11,915.7 million (US$ 1,703.9 million) in 2025. The increase of gross profit compared to 2024 was mainly driven by (i) the increase in profit from vehicle sales of RMB4,073.6 million primarily due to an increase in vehicle delivery volume by 46.9%, (ii) the increase in profit from sales of parts, accessories and after-sales vehicle services of RMB903.6 million, and (iii) the increase in profit from provision of technical services of RMB344.8 million. Gross margin in 2025 was 13.6%, compared with 9.9% in 2024. The increase of gross margin as compared to 2024 was mainly driven by the increase of vehicle margin. Vehicle margin in 2025 was 14.6%, compared with 12.3% in 2024. Vehicle margin is the margin of new vehicle sales, which is calculated based on revenues and cost of sales derived from new vehicle sales only. The increase of vehicle margin as compared to 2024 was mainly driven by decreased material cost per vehicle, which is partially offset by changes in our product mix. Other sales margin in 2025 was 6.6%, compared with negative 8.6% in 2024, which was mainly driven by (i) the increase in the gross margin of sales of parts, accessories and after-sales vehicle services as a result of cost reduction and efficiency improvement, (ii) the reduction in the gross loss rate from provision of power solutions due to continued growth in our user base, and (iii) the increase of revenue from provision of technical services with relatively higher margin. Research and Development Expenses Research and development expenses decreased by 18.7% from RMB13,037.3 million in 2024 to RMB10,605.0 million (US$1,516.5 million) in 2025, primarily due to decreased personnel costs in research and development functions of RMB1,187.7 million and decreased design and development costs of RMB862.5 million resulting from different stages of development for new products and technologies. Selling, General and Administrative Expenses Selling, general and administrative expenses increased by 2.2% from RMB15,741.1 million in 2024 to RMB16,087.7 million (US$2,300.5 million) in 2025, primarily due to increased employee compensation expense of RMB345.5 million and increased rental and related expense of RMB223.6 million, driven by our sales and service network expansion, partially offset by the decreased marketing and promotional expenses of RMB284.2 million as a result of our overall cost-saving efforts and the improved operational efficiency in marketing function. 120 Table of Contents Loss from Operations As a result of the foregoing, we incurred a loss from operations of RMB14,041.2 million (US$2,007.9 million) in 2025, representing a decrease of 35.8% as compared to a loss of RMB21,874.1 million in 2024. Interest and investment income We recorded interest and investment income of RMB761.7 million (US$108.9 million) in 2025, representing a decrease of 10.8% as compared to RMB853.7 million in 2024, primarily due to lower average cash and cash equivalents balances throughout 2025 and partially offset by the increased fair value gains on our equity investments. Interest Expenses Our interest expenses increased from RMB798.4 million in 2024 to RMB885.2 million (US$126.6 million) in 2025, primarily due to additional finance leases. Share of Loss of Equity Investees Our share of loss of equity investees increased from RMB503.2 million in 2024 to RMB1,092.2 million (US$156.2 million) in 2025, primarily due to the impact of share of losses recorded from equity method investments, which included the elimination of the unrealized intercompany profit in upstream and downstream transactions. Other (Loss)/Income, Net We recorded other income of RMB451.0 million (US$64.5 million) in 2025, compared with other losses of RMB98.1 million in 2024, primarily due to an increase in foreign exchange gain of RMB552.7 million from the revaluation impact of overseas Renminbi-related assets as a result of the appreciation of Renminbi against U.S. dollars in 2025. Income Tax (Expense)/Benefit We recorded income tax expense of RMB121.9 million (US$17.4 million) in 2025, as compared to income tax benefit of RMB22.8 million in 2024, primarily due to the recognition of deferred tax liabilities in connection with the fair value change of our equity investments. Net Loss As a result of the foregoing, we incurred a net loss of RMB14,942.6 million (US$2,136.8 million) in 2025, representing a decrease of 33.3% as compared to a net loss of RMB22,401.7 million in 2024. Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Revenues Our revenues increased by 18.2% from RMB55,617.9 million in 2023 to RMB65,731.6 million in 2024, primarily attributable to (i) an increase in vehicle sales by RMB8,976.8 million, as a result of an increase in vehicle delivery volume by 38.7%, partially offset by a decrease in the average selling price of our vehicles mainly due to changes in product mix, and (ii) an increase in other revenues by RMB1,497.1 million from sales of parts, accessories and after-sales vehicle services and provision of power solutions, as a result of continued growth in the number of our users, partially offset by (iii) the decrease in revenue from sales of used cars by RMB587.8 million. Cost of sales Our cost of sales increased by 12.7% from RMB52,566.1 million in 2023 to RMB59,238.8 million in 2024, primarily attributable to (i) an increase in cost of vehicle sales by RMB6,507.0 million, as a result of an increase in vehicle delivery volume by 38.7%, partially offset by lower material cost per vehicle and changes in our product mix, and (ii) an increase in cost of provision of power solutions and parts, accessories and after-sales vehicle services by RMB840.1 million, as a result of higher depreciation and operating cost from the increased investment in our power and service network, partially offset by (iii) the decrease in cost of used car sales of RMB746.4 million, as a result of decreased used car sales volume. 121 Table of Contents Gross Profit and Gross Margin Our gross profit increased by 112.8% from RMB3,051.8 million in 2023 to RMB6,492.8 million in 2024. The increase of gross profit compared to 2023 was mainly driven by (i) the increase in profit from vehicle sales of RMB2,469.8 million primarily due to an increase in vehicle delivery volume by 38.7%, and (ii) the increase in profit from sales of parts, accessories and after-sales vehicle services with RMB850.1 million. Gross margin in 2024 was 9.9%, compared with 5.5% in 2023. The increase of gross margin as compared to 2023 was mainly driven by the increase of vehicle margin. Vehicle margin in 2024 was 12.3%, compared with 9.5% in 2023. Vehicle margin is the margin of new vehicle sales, which is calculated based on revenues and cost of sales derived from new vehicle sales only. The increase of vehicle margin as compared to 2023 was mainly driven by decreased material cost per vehicle, which is partially offset by changes in our product mix. Other sales margin in 2024 was negative 8.6%, compared with negative 25.4% in 2023, which was mainly driven by the increase of sales of parts, accessories and after-sales vehicle services with relatively high sales margin. Research and Development Expenses Research and development expenses decreased by 2.9% from RMB13,431.4 million in 2023 to RMB13,037.3 million in 2024, primarily due to decreased design and development costs of RMB457.6 million and decreased personnel costs in research and development functions of RMB169.3 million resulting from different stages of development for new products and technologies, partially offset by the incremental depreciation and amortization expenses of RMB270.3 million. Selling, General and Administrative Expenses Selling, general and administrative expenses increased by 22.2% from RMB12,884.6 million in 2023 to RMB15,741.1 million in 2024, primarily due to (i) increased employee compensation expense of RMB1,475.9 million driven by an increase in sales functions personnel, and (ii) increased marketing and promotional expenses of RMB766.4 million due to the increase in sales and marketing activities for new brands and products. Loss from Operations As a result of the foregoing, we incurred a loss from operations of RMB21,874.1 million in 2024, representing a decrease of 3.4% as compared to a loss of RMB22,655.2 million in 2023. Interest and investment income We recorded interest and investment income of RMB853.7 million in 2024, representing a decrease of 61.4% as compared to RMB2,210.0 million in 2023, primarily due to the fair value change of our equity investments. Interest Expenses Our interest expenses increased from RMB403.5 million in 2023 to RMB798.4 million in 2024, primarily due to the issuance of 2029 Notes and the 2030 Notes in September 2023 and the increased other financing arrangements. Share of Income/(Loss) of Equity Investees We recorded share of loss of equity investees of RMB503.2 million in 2024, as compared to share of income of equity investees of RMB64.4 million in 2023, primarily due to the share of losses recorded from our equity investments measured under equity method in 2024. Other (Loss)/Income, Net We recorded other losses of RMB98.1 million in 2024, compared with other income of RMB155.2 million in 2023, primarily due to an increase in foreign exchange loss of RMB253.2 million from the revaluation impact of overseas Renminbi-related assets as a result of the depreciation of Renminbi against U.S. dollars in 2024. 122 Table of Contents Income Tax (Expense)/Benefit We recorded income tax benefit of RMB22.8 million in 2024, as compared to income tax expense of RMB260.8 million in 2023, primarily due to the reversion of deferred tax liabilities in connection with the fair value change of our equity investments. Net Loss As a result of the foregoing, we incurred a net loss of RMB22,401.7 million in 2024, representing an increase of 8.1% as compared to a net loss of RMB20,719.8 million in 2023. B.Liquidity and Capital Resources Cash Flows and Working Capital We had net cash used in operating activities of RMB1,381.5 million in 2023, net cash used in operating activities of RMB7,849.2 million in 2024, and net cash provided by operating activities of RMB2,992.6 million (US$427.9 million) in 2025. As of December 31, 2025, we had a total of RMB45,864.2 million (US$6,558.5 million) in cash and cash equivalents, restricted cash (including non-current restricted cash) and short-term investments. As of December 31, 2025, 97.1% of our cash and cash equivalents and restricted cash (including non-current restricted cash) and short-term investments were denominated in Renminbi and held in PRC and Hong Kong and the other cash and cash equivalents and restricted cash (including non-current restricted cash) and short-term investments were mainly denominated in US$ and held in the PRC, Hong Kong and the United States. Our cash and cash equivalents consist primarily of cash on hand, time deposits and highly liquid investments placed with banks, which are unrestricted as to withdrawal and use, and which have original maturities of three months or less. As of December 31, 2025, we had bank credit quotas with an aggregate amount of RMB77,756.6 million (US$11,119.0 million), which consists of non-collateral based bank credit quotas of RMB7,752.2 million (US$1,108.5 million) and collateral-based bank credit quotas of RMB70,004.4 million (US$10,010.5 million). Out of the total non-collateral based bank credit quotas, RMB2,480.0 million (US$354.6 million), RMB690.0 million (US$98.7 million), and RMB237.0 million (US$33.9 million) were used for bank borrowing, issuance of letters of guarantee, and bank’s acceptance notes, respectively. Out of the total collateral-based bank credit quotas, RMB24,447.5 million (US$3,495.9 million), RMB8,088.3 million (US$1,156.6 million) and RMB102.1 million (US$14.6 million) were used for issuance of bank’s acceptance notes, letters of guarantee and letter of credit respectively. As of December 31, 2025, we had RMB5,347.9 million (US$764.7 million) and RMB8,626.3 million (US$1,233.5 million) in total short-term and long-term borrowings outstanding, respectively. The borrowings outstanding primarily consisted of the 2029 Notes and 2030 Notes, our short-term and long-term bank debt, and other financing arrangement. In September 2023, we issued US$500 million aggregate principal amount of 3.875% convertible senior notes due 2029, or the 2029 Notes, and US$500 million aggregate principal amount of 4.625% convertible senior notes due 2030, or the 2030 Notes. We granted the initial purchasers in the notes offering an option to purchase up to an additional US$75 million in aggregate principal amount of the 2029 Notes and up to an additional US$75 million in aggregate principal amount of the 2030 Notes. The initial purchasers exercised in full the option to purchase from us an aggregate of US$75 million principal amount of the 2029 Notes and US$75 million principal amount of the 2030 Notes. The 2029 Notes and the 2030 Notes are unsecured debt. The 2029 Notes will bear interest at a rate of 3.875% per year, and the 2030 Notes will bear interest at a rate of 4.625% per year. The 2029 Notes will mature on October 15, 2029 and the 2030 Notes will mature on October 15, 2030, unless repurchased, redeemed or converted in accordance with their terms prior to such date. The holders of the 2029 Notes and the 2030 Notes shall have the right, at such holder’s option, to convert all or any portion of their 2029 Notes or 2030 Notes, as applicable, at any time prior to the close of business on the second scheduled trading day immediately preceding the relevant maturity date. Upon conversion, we will pay or deliver to such converting holders, as the case may be, cash, ADSs, or a combination of cash and ADSs, at our election. The initial conversion rate of the 2029 Notes is 89.9685 ADSs per US$1,000 principal amount of such 2029 Notes. The initial conversion rate of the 2030 Notes is 89.9685 ADSs per US$1,000 principal amount of such 2030 Notes. The relevant conversion rate for such series of the 2029 Notes and the 2030 Notes is subject to adjustment upon the occurrence of certain events. 123 Table of Contents Holders of the 2029 Notes and 2030 Notes may require us to repurchase all or any portion of their 2029 Notes and 2030 Notes for cash on October 15, 2027, in the case of the 2029 Notes, and October 15, 2028, in the case of 2030 Notes, or in the event of certain fundamental changes, at a repurchase price equal to 100% of the principal amount of the 2029 Notes or the 2030 Notes to be repurchased plus accrued and unpaid interest, if any, to, but excluding, the repurchase date. In addition, on or after October 22, 2027, in the case of the 2029 Notes, and October 22, 2028, in the case of the 2030 Notes, until the 20th scheduled trading day immediately prior to the relevant maturity date, we may redeem all or part of the 2029 Notes and 2030 Notes, as applicable for cash subject to certain conditions, at a redemption price equal to 100% of the principal amount of the 2029 Notes or the 2030 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the optional redemption date. Furthermore, we may redeem all but not part of the 2029 Notes or the 2030 Notes in the event of certain changes in the tax laws. Satisfying the obligations of the 2029 Notes and the 2030 Notes could adversely affect the amount or timing of any distributions to our shareholders. We may choose to satisfy, repurchase, or refinance the 2029 Notes or the 2030 Notes through public or private equity or debt financings if we deem such financings available on favorable terms. As of the date of this annual report, based on the outstanding principal amount of the 2027 Notes, the 2029 Notes and the 2030 Notes and the highest conversion rate under each indenture, the maximum number of ADSs that would be issued in connection with the outstanding convertible notes is approximately 134.5 million. In January 2021, we issued US$750 million aggregate principal amount of 0.00% convertible senior notes due 2026, or the 2026 Notes, and US$750 million aggregate principal amount of 0.50% convertible senior notes due 2027, or the 2027 Notes. The 2026 Notes matured on February 1, 2026, and we repaid the then outstanding 2026 Notes that had not been redeemed, repurchased or converted in full. Substantially all of the 2027 Notes have also been repurchased or exchanged, with an aggregate principal amount of US$0.2 million outstanding as of December 31, 2025. Our principal sources of liquidity have been proceeds from issuances of equity securities, our notes offerings, our bank credit quotas and cash flow from business operations. We have been applying a variety of methods to manage our working capital. We use just-in-time, pull-production system to control the inventory level of the components. Meanwhile, payment methods for our suppliers can be a combination of cash and notes payable. We incurred significant losses in the past and only started to record net profit in the fourth quarter of 2025. We incurred net losses of RMB20,719.8 million, RMB22,401.7 million and RMB14,942.6 million (US$2,136.8 million) for the years ended December 31, 2023, 2024 and 2025, respectively. In addition, although we generated positive operating cash flows in 2025, we had negative operating cash flows of RMB1,381.5 million and RMB7,849.2 million in 2023 and 2024, respectively. Therefore, our ability to continue as a going concern is largely dependent on the successful implementation of our management’s business plan to mitigate these adverse conditions, which includes growing our revenue by increasing the sales volume of electric vehicles, optimizing our operation efficiency, maintaining a reasonable working capital turnover rate by managing collection of receivables and settlement of payables, and raising funds from banks under available credit quotas and other sources when needed. We have prepared a cash flows forecast covering the twelve months from the date of issuance of the consolidated financial statements after giving consideration to our business plan as noted above and the evaluation of the probability of the successful implementation of such business plan. We have assessed the uncertainties as to the successful execution of such business plan and concluded it is probable that the business plan will be effectively implemented, and our available cash and cash equivalents, restricted cash and short-term investments, cash generated from operating activities and funds from available credit quotas and other sources will be sufficient to support our continuous operations and necessary capital expenditures, and to meet our payment obligations when liabilities fall due within the twelve months from the date of issuance of the consolidated financial statements. However, we may decide to enhance our liquidity position or increase our cash reserve for future expansions and acquisitions through additional capital and/or finance funding. The issuance and sale of additional equity would result in further dilution to our shareholders. The incurrence of indebtedness would result in increased fixed obligations and could result in operating covenants that would restrict our operations. We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all. 124 Table of Contents The following table sets forth a summary of our cash flows for the periods indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2023 ​ 2024 ​ 2025 ​ ​ ​ ​ RMB ​ ​ ​ RMB ​ ​ ​ RMB ​ ​ ​ US$ ​ (in thousands) Summary of Consolidated Cash Flow Data: ​ ​ ​ ​ Net cash used in operating activities before movements in working capital ​ (14,466,984) ​ (11,461,099) ​ (2,819,656) ​ (403,206) Changes in operating assets and liabilities ​ 13,085,438 ​ 3,611,931 ​ 5,812,268 ​ 831,143 Net cash (used in)/provided by operating activities ​ (1,381,546) (7,849,168) 2,992,612 427,937 Net cash used in investing activities ​ (10,885,375) (4,958,493) (11,459,690) (1,638,714) Net cash provided by financing activities ​ 27,662,881 1,772,483 6,844,360 978,730 Effects of exchange rate changes on cash, cash equivalents and restricted cash ​ 70,254 161,039 (16,256) (2,324) Net increase/(decrease) in cash, cash equivalents and restricted cash ​ 15,466,214 (10,874,139) (1,638,974) (234,371) Cash, cash equivalents and restricted cash at beginning of the year ​ 23,155,293 38,621,507 27,747,368 3,967,821 Cash, cash equivalents and restricted cash at end of the year ​ 38,621,507 27,747,368 26,108,394 3,733,450 ​ Operating Activities Net cash provided by operating activities was RMB2,992.6 million (US$427.9 million) in 2025, as compared to net cash used in operating activities was RMB7,849.2 million in 2024, primarily due to a decrease in net loss excluding non-cash and non-operating items of RMB8,641.4 million and favorable changes in net operating assets and liabilities of RMB2,200.4 million. The decrease in net loss excluding non-cash and non-operating items was higher than the decrease in net loss, primarily due to changes in non-cash and non-operating items such as depreciation and amortization and amortization of right-of-use assets as a result of increased expenditure on long-lived assets. The favorable changes in net operating assets and liabilities was mainly due to the net positive effect on cash flow of RMB12,204.4 million from movements of trade and notes payable and inventories mainly attributable to the increased purchase and production due to business growth in the second half of 2025, partially offset by (i) the net negative effect on cash flow of RMB6,579.5 million from movements of trade and notes receivable, non-current portion of auto financing receivables and amounts due from related parties mainly attributable to one-time cash inflow from derecognition of transferred assets under asset-backed securitization arrangements in 2024, and increased sales volume, and (ii) the net negative effect on cash flow of RMB3,012.0 million from movements of contract liabilities and payables to BaaS users mainly attributable to the fulfillment of contractual obligations. Net cash used in operating activities was RMB7,849.2 million in 2024, as compared to a net loss of RMB22,401.7 million. The difference was primarily attributable to (i) non-cash items of RMB10,940.6 million, which primarily consisted of depreciation and amortization of RMB5,875.5 million, share-based compensation expenses of RMB1,928.5 million, and amortization of right-of-use assets of RMB1,825.2 million, and (ii) a net increase in changes in operating assets and liabilities by RMB3,611.9 million, which was primarily attributable to an increase in trade and notes payable of RMB4,717.2 million, a decrease in trade and notes receivable of RMB2,985.8 million, and a decrease in other non-current assets of RMB1,385.1 million, partially offset by an increase in amounts due from related parties of RMB5,980.9 million. Net cash used in operating activities was RMB1,381.5 million in 2023, as compared to a net loss of RMB20,719.8 million. The difference was primarily attributable to (i) non-cash items of RMB6,252.8 million, which primarily consisted of depreciation and amortization of RMB3,378.0 million, share-based compensation expenses of RMB2,369.0 million, amortization of right-of-use assets of RMB1,529.5 million, and (ii) a net increase in changes in operating assets and liabilities by RMB13,085.4 million, which was primarily attributable to an increase in trade and notes payable of RMB4,870.8 million, a decrease in inventory of RMB2,895.5 million, a decrease in other non-current assets of RMB2,600.0 million. ​ 125 Table of Contents Investing Activities Net cash used in investing activities increased by RMB6,501.2 million to RMB11,459.7 million (US$1,638.7 million) in 2025 from RMB4,958.5 million in 2024. The increase was mainly due to the increased net cash outflows of RMB10,244.5 million from purchases and sale of short-term investments as a result of our cash and investment management, partially offset by decreased cash investment in capital expenditure of RMB2,922.5 million which was attributable to timing effect according to payment schedule. Net cash used in investing activities was RMB4,958.5 million in 2024, primarily attributable to (i) purchase of short-term investments of RMB45,957.6 million, and (ii) purchase of property, plant and equipment and intangible assets of RMB9,142.3 million, partially offset by proceeds from maturities of short-term investments of RMB50,413.9 million. Net cash used in investing activities was RMB10,885.4 million in 2023, primarily attributable to (i) purchase of short-term investments of RMB43,899.1 million, and (ii) purchase of property, plant and equipment and intangible assets of RMB14,340.8 million, inclusive of VAT input, partially offset by proceeds from maturities of short-term investments of RMB47,753.6 million. Financing Activities Net cash provided by financing activities increased by RMB5,071.9 million to RMB6,844.4 million (US$978.7 million) in 2025 from RMB1,772.5 million in 2024. The increase was mainly due to the cash inflows of RMB11,854.7 million from the issuance of ordinary shares, partially offset by (i) the decreased cash inflows of RMB6,473.8 million from proceeds from borrowings and capital injection from redeemable non-controlling interests, and (ii) increased cash outflows of RMB776.4 million from repayments of borrowings. These changes were attributable to our cash management in financing activities based on cash needs. Net cash provided by financing activities was RMB1,772.5 million in 2024, primarily attributable to proceeds from borrowings from third parties of RMB9,218.9 million and capital injection from redeemable non-controlling interests of RMB3,295.5 million, partially offset by repayments of borrowings from third parties of RMB7,512.8 million and repurchase of convertible senior notes of RMB3,302.2 million. Net cash provided by financing activities was RMB27,662.9 million in 2023, primarily attributable to (i) proceeds from issuance of ordinary shares to CYVN Investments, net of RMB20,962.3 million, (ii) proceeds from issuance of convertible senior notes of RMB8,120.8 million, and (iii) proceeds from borrowings from third parties of RMB8,014.4 million, partially offset by repayments of borrowings from third parties of RMB6,096.0 million and repurchase of convertible senior notes of RMB3,387.6 million. 126 Table of Contents Material Cash Requirements Our material cash requirements as of December 31, 2025 primarily include our capital commitments, operating and financing lease obligations, short-term and long-term borrowings, and convertible notes, as below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Payment due by period ​ ​ ​ ​ Total ​ ​ ​ Less than 1 year ​ ​ ​ 1-3 years ​ ​ ​ 3-5 years ​ ​ ​ More than 5 years ​ (in RMB thousands) Capital commitments ​ 4,189,169 ​ 4,150,450 ​ 38,719 ​ — ​ — Operating lease obligations 16,363,541 2,420,506 3,804,226 2,658,616 7,480,193 Finance lease obligations 7,203,140 409,668 789,353 754,166 5,249,953 Short-term and long-term borrowings 6,564,512 5,564,453 745,504 165,802 88,753 Convertible notes ​ 8,919,446 ​ 348,180 ​ 8,571,266 ​ — ​ — Total 43,239,808 12,893,257 13,949,068 3,578,584 12,818,899 Our capital commitments are commitments in relation to the purchase of property and equipment including leasehold improvements. Our operating and finance lease obligations consist of leases in relation to certain manufacturing plant, offices and buildings and other properties for our sales and service network. Our short-term and long-term borrowings represent borrowings with maturity from one to seven years. Our convertible notes that remained outstanding as of December 31, 2025 represented (i) the 2026 Notes with outstanding principal amount of US$912,000 as of December 31, 2025, which have matured in February 2026, (ii) the 2027 Notes with outstanding principal amount of US$213,000 as of December 31, 2025, which will mature in February 2027, (iii) the 2029 Notes with outstanding principal amount of US$575.0 million as of December 31, 2025, which will mature in October 2029 and (iv) the 2030 Notes with outstanding principal amount of US$575.0 million as of December 31, 2025, which will mature in October 2030. We intend to fund our existing and future material cash requirements with our existing cash balance. We will continue to make cash commitments, including capital expenditures, to support the growth of our business. Other than those shown above, we did not have any significant capital and other commitments, long-term obligations, mortgages and charges or guarantees as of December 31, 2025. As of December 31, 2025, save as disclosed in our consolidated financial statements included elsewhere in this annual report, we did not have significant contingent liabilities. As of December 31, 2025, save as disclosed in this section, we did not have any significant bank overdrafts, loans and other similar indebtedness, liabilities under acceptances or acceptance credits, debentures, mortgages, charges hire purchase commitments or other outstanding material contingent liabilities. Capital Expenditures In 2023, 2024 and 2025, our capital expenditures were mainly used for the acquisition of property, plant and equipment which consisted primarily of charging and battery swap equipment, mold and tooling, production facilities, IT equipment, research and development equipment, leasehold improvements mainly for NIO Houses and NIO Spaces, delivery and servicing centers, Power Swap Stations and laboratories as well as equity investments. We made capital expenditures of RMB14,762.5 million, RMB9,534.7 million and RMB6,630.7 million (US$948.2 million) in 2023, 2024 and 2025, respectively. We expect our capital expenditures to continue to be significant in the foreseeable future as we expand our business, and that our level of capital expenditures will be significantly affected by user demand for our products and services. The fact that we have a limited operating history means we have limited historical data on the demand for our products and services. As a result, our future capital requirements may be uncertain and actual capital requirements may be different from those we currently anticipate. To the extent the proceeds of securities we have issued and cash flows from our business activities are insufficient to fund future capital requirements, we may need to seek equity or debt financing. We will continue to make capital expenditures to support the expected growth of our business. 127 Table of Contents Holding Company Structure NIO Inc. is a holding company with no material operations of its own. We conduct our operations in China primarily through our PRC subsidiaries, and, to a much lesser extent, the VIEs, and NIO Insurance Broker Co., Ltd., the subsidiary of Anhui NIO DT. As a result, our ability to pay dividends depends significantly upon dividends paid by our PRC subsidiaries. If our existing PRC subsidiaries or any newly formed ones incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us. In addition, our wholly foreign-owned subsidiaries in China are permitted to pay dividends to us only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. Under PRC law, each of our subsidiaries and the VIEs and their subsidiaries in China is required to set aside at least 10% of its after-tax profits each year, if any, to fund certain statutory reserve funds until such reserve funds reach 50% of its registered capital. In addition, each of our wholly foreign-owned subsidiaries in China may allocate a portion of its after-tax profits based on PRC accounting standards to enterprise expansion funds, staff bonuses and welfare funds at its discretion, and the VIEs may allocate a portion of their after-tax profits based on PRC accounting standards to a discretionary surplus fund at its discretion. The statutory reserve funds and the discretionary funds are not distributable as cash dividends. Remittance of dividends by a wholly foreign-owned company out of China is subject to examination by the banks designated by the SAFE. Our PRC subsidiaries have not paid dividends and will not be able to pay dividends until they generate accumulated profits and meet the requirements for statutory reserve funds. The VIEs did not have any material assets or liabilities as of December 31, 2025. In the future, we expect (i) Beijing NIO to focus on value-added telecommunications services, including, without limitation, performing internet services as well as holding certain related licenses; (ii) Anhui NIO AT to focus on assisted and intelligent driving services, including, without limitation, performing certain services as well as holding certain related licenses; and (iii) Anhui NIO DT to focus on insurance brokerage services, including, without limitation, performing insurance brokerage services as well as holding certain related licenses through its subsidiary. Off-Balance Sheet Arrangements Other than the guarantees provided to Battery Asset Company in relation to the BaaS model as described in Note 2(r) to our consolidated financial statements included elsewhere in this annual report, we have not entered into any off-balance sheet financial guarantees or other off-balance sheet commitments to guarantee the payment obligations of any third parties. We have not entered into any derivative contracts that are indexed to our shares and classified as shareholder’s equity or that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or product development services with us. C.Research and Development, Patents and Licenses, etc. See “Item 4. Information on the Company—B. Business Overview—Intellectual Property.” D.Trend Information Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the current fiscal year that are reasonably likely to have a material effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future operating results or financial conditions. E.Critical Accounting Estimates We prepare our consolidated financial statements in accordance with U.S. GAAP, which requires our management to make estimates that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the balance sheet dates, as well as the reported amounts of revenues and expenses during the reporting periods. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations would be affected. We base our estimates on our own historical experience and other assumptions that we believe are reasonable after taking account of our circumstances and expectations for the future based on available information. We evaluate these estimates on an ongoing basis. 128 Table of Contents We consider an accounting estimate to be critical if: (i) the accounting estimate requires us to make assumptions about matters that were highly uncertain at the time the accounting estimate was made, and (ii) changes in the estimate that are reasonably likely to occur from period to period or use of different estimates that we reasonably could have used in the current period, would have a material impact on our financial condition or results of operations. There are other items within our financial statements that require estimation but are not deemed critical, as defined above. Changes in estimates used in these and other items could have a material impact on our financial statements. For a detailed discussion of our significant accounting policies and related judgments, see Note 2 to our consolidated financial statements included elsewhere in this annual report. Warranty liabilities We accrue a warranty reserve for all new vehicles that we sell, which includes our best estimate of the projected costs to repair or replace items under warranties. These estimates are based on actual claims incurred to date and an estimate of the nature, frequency and costs of future claims. These estimates are inherently uncertain given our relatively short history of sales, and changes to the historical or projected warranty experience may cause material changes to the warranty reserve when we accumulate more actual data and experience in the future. The portion of the warranty reserve expected to be incurred within the next 12 months is included within accruals and other liabilities, while the remaining balance is included within other non-current liabilities on the consolidated balance sheets. Warranty expense is recorded as a component of cost of revenues in the consolidated statements of comprehensive loss. We do not consider standard warranty as being a separate performance obligation as it is intended to provide assurance that a product complies with agreed-upon specifications and is not viewed as a distinct obligation. Accordingly, standard warranty is accounted for in accordance with ASC 460, Guarantees. ​