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Headlines
- Nikola's Financial Growth and Market Impact
- Key Metrics: Truck Deliveries and Revenue Insights
- Future Outlook: Challenges and Funding Strategies
Nikola (NASDAQ:NKLA) stock has been on a downward trend despite recent positive financial reports and expectations for possible rate cuts by the Federal Reserve. The stock has dropped over 22% in the past 30 days, bringing its year-to-date decline to 71%, with a current market capitalization of $379 million.
Positive Developments
Nikola has shown progress in its journey towards leadership in the hydrogen truck sector. The company has continued manufacturing and delivering trucks, investing in hydrogen infrastructure, and achieving carbon sales. In the third quarter, Nikola shipped 77 trucks and a total of 120 trucks in the first half of the year. For the year, the company aims to deliver between 300 and 350 trucks. Revenue for the quarter reached $31 million, up from $15 million in the same period last year. However, the company posted a gross loss of $54 million, with a total net loss reduced to $133 million from $217 million.
Revenue and Loss Projections
Nikola’s revenue for the year is anticipated to be $133 million, with an expected increase to $415 million next year. Despite the improvement, the company is not expected to achieve profitability soon, with net loss per share projected at 10.2 cents for this year and 7.68 cents for the next. Like other automakers such as Rivian and Lucid Motors, Nikola may take several years before reaching a profitable stage.
Challenges and Funding Needs
While Nikola’s advancements are notable, the company faces significant challenges. A key issue is its balance sheet, which requires additional funding. Nikola ended the quarter with $256 million in unrestricted cash, highlighting the need for further financial resources for payroll, R&D, and expansion of its HYLA program, which aims to establish modular hydrogen fueling stations. Nikola plans to have 14 stations in North America by year-end.
Recently, Nikola announced a plan to sell up to $160 million in senior notes convertible into stock, with the initial tranche expected to raise $74.3 million. This move is part of a broader strategy to address cash needs, as the company has seen a substantial increase in its number of outstanding shares over the years.
