NIO Stock Stares At Another Red Month — But Morgan Stanley Says Nvidia-Rivaling AI Chip Arm Could Be Nio’s Valuable Call Option

Morgan Stanley believes GeniTech’s standalone debut could help investors view Nio as more than a cash-intensive EV manufacturer.

• Nio spun out GeniTech in June 2025 but still owns about 63% of the AI chip and semiconductor business.
• Its flagship NX9031X powers all Nio and Onvo models, with shipments above 300,000 and performance comparable to four Nvidia Orin chips.
• Morgan Stanley sees licensing, outside customers and robotics applications turning GeniTech’s research spending into revenue and potential margin support.

U.S.-listed shares of Nio, Inc. are on track for another monthly decline, but Morgan Stanley says the automaker’s AI chip unit, GeniTech, could become a visible call option after its first standalone public debut at the World Artificial Intelligence Conference 2026.

Nio’s U.S.-listed shares fell 0.5% on Tuesday, extending their losing streak to four sessions and bringing the stock’s monthly decline to 5%. 

Nio Chip Unit Targets AI Growth 

GeniTech, also known as Shenji, develops automotive-grade processors and AI computing platforms. Nio spun out the business in June 2025 but retains a controlling stake of about 63%. At the Shanghai conference, GeniTech presented its NX9031X, NX9031U and NX9031C processors alongside tech spanning assisted driving, robotics and AI agent inference, CnEVPost noted.

Morgan Stanley Highlights Hidden AI Asset

Morgan Stanley said that the appearance could gradually shift investor perception of Nio from a cash-intensive EV manufacturer toward a vertically integrated AI and semiconductor platform. 

The bank sees particular potential in GeniTech’s expansion beyond vehicles into humanoid robots, autonomous logistics, advanced manufacturing and high-compute terminals. These applications could substantially widen the unit’s addressable market.

Nio’s Flagship Chip Matches Four Nvidia Orins

The flagship NX9031X already powers every Nio and Onvo-branded model, with cumulative shipments exceeding 300,000 units, according to Morgan Stanley. The bank said one NX9031 provides computing performance comparable to four Nvidia Orin processors. Producing the chips internally could therefore reduce Nio’s reliance on imported computing hardware while spreading fixed development costs across a larger volume base.

The midrange NX9031U, built on a 5-nanometer automotive-grade process, delivers up to 800 TOPS of equivalent computing power under air cooling. It also supports GeniTech’s Ruidong development platform for robot perception, planning, intelligent computing and advanced manufacturing. GeniTech has additionally introduced the NX9031C, the NX6031 sensing processor and a distributed AI agent platform.

Beyond EVs: Robotics, Licensing Could Expand Revenue Opportunity

Morgan Stanley believes GeniTech is beginning to turn years of heavy research spending into a commercial business. The unit started licensing NX9031 technology to a third-party automotive chip company in late 2025, adding potential royalty income alongside savings from supplying Nio’s own vehicles.

As external customers and robotics applications grow, the chip operation could move from pressuring margins to protecting them, the bank said. GeniTech has raised nearly 3 billion yuan, or about $440 million, since its separation from Nio. A February funding round valued the business at 8.3 billion yuan ($1.2 billion) after the investment. 

Nio Leads Shanghai Large SUV Market 

The emerging semiconductor story comes as Nio gains ground in Shanghai’s large SUV market. The Nio ES8 and ES9, together with Onvo’s L80 and L90, accounted for more than 60% of the city’s large SUV segment during the first half. The ES8 has ranked as Shanghai’s top-selling large SUV for eight consecutive months. Deliveries of the third-generation ES8 are expected to reach 130,000, with the latest 10,000 vehicles delivered in roughly one month. Momentum has also improved following the launch of a lower-priced five-seat version in July.

How Do Retail Traders Feel About NIO?

On Stocktwits, retail sentiment for NIO was ‘bearish’ amid an 18% rise in 24-hour message volumes.

One user said, “when a major US bank starts pushing this sort of news out there , you know you're not a struggling business anymore. This is massive.”

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Another user said, “$NIO The mission is to outsell Tesla and become the top EV company we’re on track”

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Nio’s U.S.-listed stock has climbed 6% over the past year. 

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