Nikola Corporation (NASDAQ: NKLA) stock plummeted over 5% in intraday trading on Tuesday. The plummet followed the company’s disappointing first-quarter revenue announcement, which failed to meet Wall Street’s expectations. Challenges in delivering hydrogen fuel cell trucks amid an uncertain macroeconomic climate and reduced customer spending contributed to the revenue shortfall.
Nikola (NKLA) recorded revenue of $7.5 million for the quarter, significantly lower than the estimated $15.8 million according to LSEG data.
The company delivered 75 hydrogen fuel cell trucks in the first two production quarters and wrapped up the delivery of its first reworked battery truck at the first quarter’s end.
However, Nikola announced a delay in the delivery timeline for its reworked battery trucks, pushing it to the end of 2024 from the earlier plan to complete it by the second quarter’s end or early third quarter.
During a post-earnings conference call, Nikola executives revealed expectations to deliver between 50 and 60 fuel-cell hydrogen trucks in the second quarter. Nevertheless, the company faces challenges selling its hydrogen big rigs, as consumers and businesses remain cautious about spending on relatively higher-priced electric vehicles amidst high borrowing costs, opting for cheaper hybrid alternatives.
Despite efforts to accelerate hydrogen big rig production, Nikola experienced a 26% decline in truck revenue, amounting to $7.4 million. The company did manage to narrow its net loss to $147.7 million from $169.1 million compared to the previous year, thanks to a 15% reduction in operating expenses. However, its cash and cash equivalents decreased to $345.6 million at the end of the first quarter, down from $464.7 million in the previous three months.
In March, the company announced the opening of refueling stations in California and Alberta, Canada, for its hydrogen trucks.
Nikola (NASDAQ: NKLA) Stock Reaction
The stock market reaction was immediate, with NKLA stock plunging 5.41% to close at $0.6029 on Tuesday, marking a 2.85% decrease for the week. Trading activity surged, with 157.47 million shares changing hands, well above the average daily volume of 94.55 million.
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