EV startup Canoo's 2024 revenue forecast disappoints, shares tumble
Reuters
Published Apr 01, 2024 05:02PM ET
Updated Apr 01, 2024 07:45PM ET
By Granth Vanaik and Abhirup Roy
(Reuters) -Electric vehicle maker Canoo forecast 2024 revenue well below analyst expectations on Monday, amid a broader slowdown in demand for battery-powered cars that has hit startups and forced major automakers to push back EV investment plans.
Shares in Canoo, which also warned for the eighth straight quarter about its dwindling capital and ability to continue as a going concern without additional funding, fell 38% in extended trading.
The EV industry has been struggling as high-interest rates to curb inflation have soured consumer appetite for EVs - typically more expensive than their gas-powered counterparts - and prompted automakers, including market leader Tesla (NASDAQ:TSLA), to slash prices in order to stoke demand.
Texas-based Canoo, a supplier of electric delivery vans to Walmart (NYSE:WMT) and crew transportation vehicles to NASA, first warned investors in 2022 on substantial doubt about its ability to remain a going concern and has since been raising capital to support production.
"We will continue to make progress towards accessing additional forms of debt and other non-dilutive forms of capital as we move into 2024," CFO Greg Ethridge said on a post-earnings call. "Let's be very clear. We'll only raise the capital that we need."
But with uncertain demand and several startups shutting shop, investors in EV makers have grown cautious, in turn making it difficult for firms to raise more money.
Cash-strapped Fisker (NYSE:FSR) said last month its talks with a large automaker for a potential deal had collapsed and the New York Stock Exchange said it planned to delist its shares due to "abnormally low" price levels.
Canoo had also implemented a reverse stock split in March as it sought to regain compliance with the minimum $1 bid price requirement of the Nasdaq exchange.
Canoo said it expects full-year 2024 revenue to be between $50 million and $100 million, below analysts' expectations of $152.5 million, according to LSEG data.
The company reported a net loss of $302.6 million, or 53 cents per share, for the year ended Dec. 31, compared with $487.7 million, or $1.81 per share, a year earlier.
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Written By: Reuters
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