Nikola Corporation (NASDAQ:NKLA)
After missing Q1 earnings projections and announcing an imminent production slowdown, shares of Nikola Corporation (NASDAQ:NKLA) dipped on Tuesday.
As expected, the Phoenix-based manufacturer lost $0.26 per share, while its sales of $11.12 million were $1.23 million lower than anticipated. The quarterly adjusted EBITDA loss of $126.7M was more than the average estimate of $123.4M.
CEO Michael Lohscheller said that the quarter was “very solid” for Nikola, adding that the company had built sales momentum by delivering Class 8 battery electric vehicles to clients and receiving orders for 140 hydrogen fuel cell trucks. We want to focus on the North American market, hydrogen fuel cell trucks, the HYLA hydrogen refueling company, and autonomous technologies in the near future since we have the right items at the appropriate time. Our revitalized management and commercial teams, enhanced sales strategy, new dealers, and committed energy partners have led us to success
In the third quarter, the firm made 31 wholesale shipments to dealers and 33 retail shipments from dealers to clients. The average forecast for when packages will arrive was 29. The corporation did not provide any kind of forecast for the next delivery.
It seems the firm has “reprioritized the business” to concentrate on hydrogen fuel cell trucks, the HYLA hydrogen ecosystem, and autonomous technologies, vehicle controls, and software for the North American market. The results report detailed how management had redirected resources to “competitive and first mover advantage” sectors while cutting down on investment in other, less lucrative areas.
In light of this, we have decided to sell our portion of the European manufacturing joint venture to Iveco Group for $35 million in cash and 20.6 million shares of Nikola stock, according to the results announcement. It is anticipated that Iveco will continue to be a significant stakeholder going ahead and, as such, will continue to be an essential business partner and a major supplier to us.
The firm also reported steady advancement toward the completion of Phase 2 of the assembly hall expansion in Arizona by the end of the second quarter. However, it anticipates ceasing manufacturing by the end of the month.
According to an earnings announcement, the company plans to halt truck manufacturing at the end of May while it converts the line to accept hydrogen fuel cell and battery electric vehicles on the same line and then restart production in July with the first saleable hydrogen fuel cell trucks. Battery module and pack production in Coolidge is scheduled to start by the end of July, while Bosch Fuel Cell Power Module assembly is expected to commence by December 2023.
Shortly before the opening bell on Tuesday, Nikola stock dropped by 1%.
Featured Image: Megapixl
