(Yicai Global) Dec. 31 -- Nio's shares surged 54 percent, the most since the day after it went public in September 2018, as the Chinese electric carmaker posted better-than-expected third-quarter revenue and pared its loss.

The stock [NYSE:NIO] closed at USD3.72 yesterday after earlier peaking at USD4.72. In out-of-hours trading, the shares gained another 7.3 percent to USD3.99, giving Nio a market cap of more than USD3.9 billion.

Revenue jumped 25 percent to CNY1.8 billion (USD257 million) in the three months through September from a year earlier, the Shanghai-based company said in an earnings report yesterday. That topped the CNY1.63 billion average estimate of analysts by Refinitiv. Its loss attributable to shareholders narrowed 74 percent to CNY2.6 billion from a year ago, taking Nio's accumulated losses to USD6 billion.

China's new energy vehicle makers have struggled since the government cut subsidies in June, adding to the pressure on Nio, which resorted to cost-cutting measures such as staff redundancies and the sale of business units.

"The electric vehicle sector experienced substantial softness in the second half of 2019 after the reduction of EV [electric vehicle] subsidies in China," Chairman and Chief Executive William Li said, adding that "despite the challenges, Nio's sales improved solidly since September."

Nio delivered a total of 4,799 of its ES8 and ES6 sports-utility vehicles in the third quarter, up 35 percent annually, and expects to deliver 8,000 cars and post CNY2.8 billion revenue in the fourth quarter, Li said. That makes for a total 20,300 deliveries in 2019, he added. Nio released its newest model, an electric crossover named the EC6 that will look to rival Tesla's Model 3 on Dec. 28.

Nio has been looking to streamline operations this year and let go of 2,400 staff in the third quarter to cut its headcount to 7,500. More is on the way, newly appointed Chief Financial Officer Feng Wei said at a meeting held to discuss the company's third-quarter financials.

The company brought in USD190.5 million of funding during the period, Feng added. Some USD100 million came from tech giant Tencent Holdings and Li paid up USD90.5 million of the USD95 million he plans to invest, with the remainder coming in January.

The number of NEVs produced and sold in China fell for a fifth month in a row in November, according to the China Association of Automobile Manufacturers. The figures for pure electric vehicles fell 29.6 percent to 96,000 and 41.2 percent to 81,000, respectively.

Editor: James Boynton