Nikola's Fall After Surpassing Ford... Stock Price Down 67%

Q4 Earnings Outlook Deterioration

(Photo by Nikola)

[Asia Economy Reporter Yujin Cho] Nikola, once hailed as the "second Tesla" and whose market capitalization surpassed that of Ford in the US, is experiencing a sharp decline in its stock price due to worsening earnings forecasts.

On the 3rd (local time), Nikola announced in its earnings report that its third-quarter revenue reached $24.2 million, exceeding Wall Street's estimate of $22.1 million. The loss per share was 28 cents.

As of the third quarter cumulative basis, Nikola produced 125 electric trucks this year and delivered 111 units to customers.

The company had expected to deliver at least 300 electric trucks annually, but stated that the overall performance for this year would fall short due to worsening economic conditions and rising borrowing costs.

Kim Brady, Nikola's Chief Financial Officer (CFO), said during the conference call after the earnings announcement, "Annual electric truck deliveries are expected to fall short of previous estimates," and added, "The fourth quarter is also expected to underperform compared to expectations."

Additionally, the company did not disclose next year's electric truck delivery forecast, citing uncertainties regarding the timing and cost of factory expansion plans.

Following the earnings announcement, Nikola's stock price, which had plunged nearly 12% at one point, closed down 10.91% at $2.94 due to bargain hunting. Since the beginning of this year, Nikola's stock price has dropped 67% as of the closing price on the 2nd.

Foreign media analyzed that despite better-than-expected earnings, the sharp decline in stock price was driven by investor sentiment reacting to the forecast that electric truck deliveries would fall short of the annual target.

Founded in 2015, Nikola attracted market attention by announcing plans to manufacture and sell large trucks powered by electric batteries and hydrogen fuel.

Despite having no sales record for a single unit, Nikola went public on the US stock market in June 2020 through a SPAC merger, fueled by its popularity.

The stock price surged on expectations alone, and as a result, its market capitalization once surpassed that of Ford. However, delays in hydrogen fuel truck development and fraud allegations against the founder caused the stock price to repeatedly plummet.

This content was produced with the assistance of AI translation services.