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Niu Technologies, a Chinese electric scooter company, reported mixed second-quarter (Q2) results, with significant growth in China offsetting weak overseas sales. The company's stock initially dropped after the earnings report was released.

Revenue Growth and Market Performance

Niu Technologies' Q2 revenue jumped by 33.5% year-over-year (YoY) to $175.29 million (1.26 billion Chinese yuan) [1]. This growth was driven by a 36.7% increase in sales volume, primarily due to a 53.6% surge in China e-scooter sales. However, the number of e-scooters sold in international markets decreased by 35.5% YoY, indicating weak demand overseas.

Geographical Breakdown

In China, e-scooter sales revenues increased by 45.4% YoY to 1.06 billion Chinese yuan, representing 91.1% of total e-scooter revenues. Conversely, international market sales revenues declined by 20.9% YoY to 103.1 million Chinese yuan, accounting for 8.9% of total revenues [1].

Gross Margin Expansion

Niu Technologies' gross margin expanded to 20.1% from 17% a year ago, mainly driven by a higher proportion of e-scooter sales and an improved gross margin in the China market. This was achieved through cost-reduction initiatives [1].

Outlook

For the third quarter (Q3), Niu Technologies expects revenue growth of 40%-60% YoY, ranging from 1.433 billion to 1.638 billion Chinese yuan [1]. The company's CEO, Dr. Yan Li, noted that the company's products ranked among the top-selling mid- to high-end electric bicycles and motorcycles during China's e-commerce peak season. However, sales in the micromobility segment declined in overseas markets due to geopolitical and economic uncertainties.

Stock Performance

Niu Technologies' stock initially dropped after the earnings report but closed Monday up by 1.85% at $3.85, gaining over 111% year-to-date [1].

References

[1] https://www.benzinga.com/markets/earnings/25/08/47046908/niu-stock-slides-as-china-e-scooter-boom-fails-to-offset-weak-overseas-sales-mixed-q3-outlook