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Fisker secures $150 million financing deal

EditorIsmeta Mujdragic
Published 03/18/2024, 08:30 AM
© Reuters.
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LOS ANGELES - Fisker Inc. (NYSE: NYSE:FSR), a player in the electric vehicle (EV) market, has secured a financing commitment of up to $150 million from an existing investor, according to a press release issued by the company. The financing, provided by the holder of the company's 2025-dated convertible notes, will be organized in four tranches, contingent upon certain conditions, including the filing of Fisker's 2023 Form 10-K.

The EV manufacturer is also in ongoing talks with a major automaker regarding a potential deal that could encompass an investment in Fisker, co-development of EV platforms, and manufacturing in North America. However, any agreement is subject to the completion of due diligence, negotiations, and the execution of definitive agreements.

Fisker has reported the production of approximately 1,000 vehicles as of March 15, 2024, and has delivered about 1,300 vehicles globally within the same period. The company's U.S. registrations in January 2024 reached 640, surpassing Toyota (NYSE:TM) and placing it 13th among EV brands in the U.S. market, based on data from S&P Mobility reported by Automotive News.

With approximately 4,700 vehicles in inventory, including units from 2023 and those produced in 2024, Fisker estimates the value of its completed vehicle inventory to exceed $200 million as of March 15, 2024. The company has not conducted a net realizable value (NRV) analysis for 2024.

To adjust inventory levels and advance strategic and financial initiatives, Fisker will halt production for six weeks starting this week.

This news is based on a press release statement from Fisker Inc.

InvestingPro Insights

In light of Fisker Inc.'s recent financial developments, investors may be examining the company's performance through various lenses. An InvestingPro analysis reveals some critical financial metrics that could influence Fisker's market perception. The company's market capitalization stands at a modest $102.92 million, reflecting investor valuation of the firm in the highly competitive electric vehicle sector.

Despite the optimism surrounding its production and delivery numbers, Fisker operates under a significant financial strain. The company's gross profit margin for the last twelve months as of Q4 2023 was reported at a negative 37.72%, indicating challenges in maintaining profitability amidst its operational costs. Additionally, Fisker's stock has experienced considerable price volatility, with a 1-week price total return showing a sharp decline of 48.89% and a staggering 1-year price total return decrease of 97.08%, underscoring the stock's high-risk nature for investors.

InvestingPro Tips suggest that Fisker's significant debt burden and the risk of not making interest payments on its debt are concerns that potential investors should consider. Moreover, while analysts anticipate sales growth in the current year, they do not expect the company to be profitable within the same timeframe. For those looking to dive deeper into Fisker's financial health and future prospects, InvestingPro offers additional insights. There are 19 more InvestingPro Tips available, which can be accessed by visiting InvestingPro's Fisker page. Interested readers can use the coupon code PRONEWS24 to get an extra 10% off a yearly or biyearly Pro and Pro+ subscription, further enriching their investment research with valuable data and analysis.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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