Faraday Future plans second reverse stock split in five months

Faraday Future Intelligent Electric

26/02/2024 13:46

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       Feb 26 (Reuters) - Electric Vehicle (EV) startup Faraday
Future Intelligent Electric  FFIE.O  plans a one-for-three
reverse stock split to regain compliance with listing
requirements, it said on Sunday.
    The share consolidation is expected to come into effect on
Feb. 29 and would mark the company's second reverse stock in
five months after a cash crunch and supply-chain issues wiped
nearly 99% of its market value last year.
    On Friday, shares of the firm closed at $0.09, giving the
company a market value of about $11 million. 
    The Nasdaq had sent a notice to the California-based company
in December, warning that its shares were at risk of a delisting
after trading below the exchange's $1 minimum trading price for
30 consecutive business days.
    Faraday Future, which has struggled with years-long
production delays, reported a quarterly loss of $78.05 million
in quarter ended in September. 
    Growth in the global EV market is expected to slow to 27.1%
this year from an estimated growth of 29% in 2023, according to
January projections by research firm Canalys.
    Peer EV firm Nikola's  NKLA.O  shares are also trading below
$1 and are at the risk of a delisting, down from a $80 peak hit
just days after going public in June 2020.
    Faraday Future CEO Matthias Aydt said on Monday the firm was
"prioritizing cash flow breakeven over volume to avoid scaling
production too quickly, which has been an issue for many
competitors."
    The remarks came just days after rivals Rivian Automotive
 RIVN.O  and Lucid Group  LCID.O  forecast 2024 production below
estimates as they deal with the stagnation in demand for EVs.   
  
       
    

 (Reporting by Priyanka.G in Bengaluru; Editing by Tasim Zahid)
 ((Priyanka.G@thomsonreuters.com;))