Nikola, the electric truck startup that went public via a SPAC merger, warned Tuesday that supply chain constraints are causing numerous delays forcing it to slash its vehicle delivery projections in half.
The company, which is still in pre-production, said in its second-quarter earnings call that its plans to produce 50 to 100 electric semi trucks in this year have been lowered to 25 to 50 units. The less than rosy projections continued on the revenue front.
The company cut its revenue forecast for the year to $0 to $7.5 million. It was previously $15 million to $30 million.
Nikola reported a net loss of $143 million in the second quarter, up from a $115.7 million loss in the same period last year. Its adjusted loss was 20 cents per share, which is actually better than analysts expected. The company’s cash balance at the end of the quarter was $632.6 million.
While the company focused its earnings call on its progress toward producing electric trucks — which included testing pre-production vehicles and completing 0.5 Phase of its factory in Arizona — the market was more interested in its lowered outlook and the lingering effects from its founder Trevor Milton being charged with securities fraud. Among the company’s updates is that it has built 14 pre-production vehicles, five alpha and nine beta prototypes.
Shares of Nikola were down 7.47% in midday trading.
Milton, who resigned last year as Nikola’s CEO and executive chairman, was charged July 29 with two counts of securities fraud and wire fraud by a federal grand jury. Prosecutors detailed in the complaint how Milton used social media and frequent appearances on television in a PR blitz that flooded “the market with false and misleading information about Nikola” before the company even produced a product.
In March 2020, the company announced it would go public via a merger with special purpose acquisition company VectoIQ Acquisition Corp. Milton frequently posted on Twitter, directing his messages to retail investors after the company went public that summer. Then, in September, just days after GM had announced a $2 billion investment in the company, noted short-seller Hindenburg Research accused Nikola of fraud. The U.S. Securities and Exchange Commission opened an inquiry in the matter and within two weeks Milton had stepped down as executive chairman.