NIO stock tumbles 5% after NIO Inc (NYSE:NIO) announced that CFO Louis T. Hsieh resigned from the company for personal reasons, effective October 30, 2019.
Another Setback for NIO
While it is true that electric vehicles are all set to be the future of transport, things are not going that well for Chinese electric vehicle maker NIO. NIO stock has taken a beating for much of the year, and today, the company made another major announcement that creates more uncertainty about its future.
In a new development, NIO announced that its Chief Financial Officer Louis T. Hsieh has resigned due to personal reasons. The company also announced that it has already started searching for a replacement and is trying to appoint a new CFO without delay.
The resignation has been accepted, and it is going to go into effect from October 30. The Chief Executive Officer of NIO, William Li, thanked Hsieh in the press release sent out by the company. He said, “On behalf of the Board of Directors and management team, I want to thank Louis for his contributions to NIO and wish him all of the best in his future endeavours.”
NIO stock is down 5% at $1.42
Considering the current state of the company and the stock, this development could also be viewed as a case of instability by investors.
NIO might have increased its sales by as much as 35.1% in the latest reported quarter, but the fact remains that the company is losing money hand over fist. As a matter of fact, analysts have stated that NIO could face severe liquidity issues a few months from now unless some sort of solution is found.
Either a takeover or a capital infusion is needed if the company is to do business in the long term. In its second-quarter financial results, NIO revealed that it had $600 million worth of liquidity, and out of that, $342 million is in cash.
Additionally, the company has not released its results for the third quarter yet, and many analysts are assuming that the results are going to be a disappointment.
NIO stock has tumbled 75% so far this year.
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