Nikola Corporation (NKLA 0.88%), an electric vehicle maker that once charmed investors, today reported a deeper loss than expected as demand for the company's trucks fell.
The loss from continuing operations was $147.7 million, or earnings per share of negative $0.11, deeper than the average analyst forecast of an EPS loss of $0.10. That compared with a year-earlier operating loss of $145.3 million, or $0.26 a share. The company said its adjusted EPS loss in the latest quarter was $0.9.
Revenue, meanwhile, plunged almost 30% from a year earlier to roughly $7.5 million, which was less than half of the $15.8 million Wall Street expected.
| Metric | Q1 2024 | Estimates | Q1 2023 | Change (%) |
|---|---|---|---|---|
| Net Loss Per Share | -$0.11 | -$0.10 | -$0.26 | Improved |
| Total Revenue | $7.497M | $15.78M | $10.677M | -29.7% |
| Gross Margin | -768% | N/A | -213% | Worsened |
| Loss from Operations | -$145.363M | N/A | -$127.200M | Increased loss |
Data sources: Company results from company. Analyst estimates from FactSet.
Nikola's business overview
Nikola Corporation, founded in 2015, is trying to do for battery-electric trucks what Tesla did for cars, using hydrogen fuel cells. It also is working on developing the infrastructure needed to support these technologies, including hydrogen fueling stations. However, the recent earnings underscore the monumental tasks ahead as it tries to scale operations and navigate financial hurdles.
Details from the quarter
The large earnings and revenue misses reflected challenges in product sales and market penetration. Revenue from truck sales, representing the bulk of total revenue, tumbled as truck production fell to 43 from 63 in the year-earlier quarter.
Meanwhile, the company's continued development of its hydrogen infrastructure aims to address one of the major adoption hurdles for its technology. However, the financial strain from widening operating losses and significant net loss from continuing operations presents immediate concerns.
For a time after it went public in 2020 via a merger with a special purpose acquisition company (SPAC), Nikola was a hot stock, rising to almost $94 from an initial price of about $38. Today it trades at just $0.60.
Looking ahead
Management plans to focus on improving gross margins and reducing production costs. For investors and Nikola watchers, key areas to track include the company's ability to manage its cash burn, scale up production, and build out hydrogen infrastructure.
Indeed, Nikola's Q1 2024 performance underscores the volatility and challenges inherent in the zero-emission vehicle market.
