NIO, which markets premium EVs, raked in record revenue in the second quarter, but it reported a loss almost five times wider than a year earlier. HONG KONG—China’s electric-vehicle market is booming, but the country’s hottest EV startups are seeing losses grow even as sales rise. Rising battery prices and supply-chain delays this year have driven up costs further for emerging EV makers. The startups are already burning cash to introduce newer, smarter models—complete with heated massage seats or battery-swapping services—to gain a foothold in the world’s largest automobile market.

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