Improving profitability and core portfolio growth could support a continued earnings expansion for Nio , according to HSBC. The bank upgraded the Chinese electric vehicle maker to buy from hold. Analyst Yuqian Ding also lifted her price target to $6.80 from $4.80, implying upside of 23%. Ding’s upgrade comes after Nio on Tuesday reported fourth-quarter revenue growth of 65% from a year prior. She noted that vehicle volumes significantly outperformed the broader EV market, while profitability also improved in quality, largely due to a more favorable product mix. “NIO reported its first quarterly net profit in 4Q25 (RMB0.12bn), supported by strong volumes and disciplined cost management,” she wrote. NIO 1Y mountain NIO 1Y chart Ding said that this year, the company has better visibility of its profitability. She also highlighted a stronger conviction on its volume growth and earnings improvement trajectory this year. “We expect above-industry visibility for earnings in 1Q26, underpinned by continued mix benefits and less disruption to volumes from seasonal effects and the transition in subsidies,” the analyst said. Meanwhile, new model launches and core portfolio growth could support margin expansion, volume growth and a mix upgrade. “BEVs priced above RMB200k seem more resilient through subsidy transitions and softer seasonal demand in 1Q,” Ding said. “In Jan-Feb 2026, NIO delivered 48k vehicles, up 77% y-o-y, outpacing the EV market’s -26% y-o-y. We expect its portfolio, particularly ES8, to benefit from robust orders, supported by cash promotion initiated in March.” She added that the next product cycle, alongside a new large Nio SUV expected in the third quarter, should further lift volumes and help the company sustain an improved product mix. “NIO is moving into a phase with sustainable volume growth and margin improvement, driven by new product strength and structural mix upgrade,” she added. The analyst’s revised revenue and earnings estimates are respectively 15% and 80% higher than Bloomberg consensus, she said. They reflect higher conviction on Nio’s operating expenditures efficiency, margin strength and volume growth. Shares of Nio ended Tuesday slightly lower but have added 9% this year. Over the past 12 months, they have surged 17%.