NKLA Stock Falls As Nikola Guidance Slashed On Supply-Chain Woes2 min read

Nikola</strong> (NKLA) beat second-quarter forecasts but cut targets for the Tesla (TSLA) challenger’s path to producing fuel-cell and electric trucks for the commercial market. NKLA stock fell.

Nikola Earnings Report

The EV startup’s per-share losses widened to 20 cents from 14 cents in the prior quarter, but that was still better than the 30-cent loss per share that Wall Street was expecting.

During Q2, Nikola continued validating the first batch of five Tre battery electric trucks, the company said. And validation on three out of nine trucks from the second batch has begun, continuing through Q3 and into the beginning of Q4. The Tre is seen as a rival to the forthcoming Tesla Semi.

Nikola also completed an initial phase of its Coolidge, Ariz. manufacturing plant and is currently building seven trucks there, including two Tre battery EV pre-builds and five Tre fuel-cell EVs.

But in a call with analysts later, management warned supply-chain issues could delay validation, testing and delivery timelines for the Tre trucks, saying “one of biggest challenges is supply chain. Situation more acute last 90 days.”

The company now sees 2021 deliveries of 25-50 vehicles, down from an earlier view for 50-100 and put revenue guidance at $0-$7.5 million, down from $15 million-$30 million.

The EV startup also announced Tuesday a purchase agreement with Tumim Stone Capital for up to $300 million of NKLA stock. And it has acquired a 20% stake in the Wabash Valley Resources clean hydrogen project in West Terra Haute, Ind.

For the second half of the year, Nikola expects to announce additional fleet testing customers and dealers, while breaking ground on its first commercial hydrogen refueling station and/or a hydrogen production facility.

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NKLA Stock

Shares fell 4.3% to 10.70 in Tuesday stock market trading. NKLA stock remains in a bear market after a string of blows in the past year, including scaled-back or scrapped EV partnerships with the likes of General Motors (GM) and Republic Services (RSG), as well as the damning short-seller report.

Nikola plans to build both all-electric and fuel-cell versions of the Tre semi-truck for long-haul trucking. It also plans a network of hydrogen refueling stations to accelerate the adoption of fuel-cell trucks in the commercial market.

Nikola earnings came days after U.S. officials charged founder Trevor Milton with misleading investors, in the wake of a scathing short-seller report first accused the EV startup of “an ocean of lies.”

Milton exited the company last September. In February, Nikola’s own investigation found Milton made inaccurate statements over several years that misled investors.

Find Aparna Narayanan on Twitter at @IBD_Aparna.


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