Nikola's Stock Keeps Bouncing as Revenue Beats Expectations

Nikola Corp.'s stock continued to rebound on Friday after the electric and hydrogen-fuel-cell truck manufacturer reported a significant reduction in losses and more than doubled its revenue, surpassing expectations for the first time in nearly two years.

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In morning trading, Nikola's stock surged 10.1%, building on a 6.4% rally from Thursday. This recent rally helped the stock break free from an 11-session losing streak that had set a new record and driven the share price to an all-time low of $7.33 on Wednesday.

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For the most recent quarter, Nikola reported a net loss of $133.7 million, or $2.86 per share. This marked a sharp improvement from the $217.8 million loss, or $5.93 per share, recorded in the same period last year. When excluding nonrecurring items, the adjusted per-share loss was $2.67, a significant reduction from the $5.90 loss recorded a year ago. This figure also beat analysts' expectations, with the consensus from FactSet projecting a loss of $2.78 per share.

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Nikola's total revenue more than doubled, climbing to $31.3 million from $15.4 million in the same quarter last year. This revenue figure surpassed the FactSet consensus estimate of $26.2 million, marking the first time Nikola exceeded revenue expectations in seven quarters, with the last beat occurring in the third quarter of 2022.

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The company also saw substantial growth in its production and shipments. The number of trucks produced increased by 133% to 77 units, while the number of trucks shipped rose by 62% to 73 units.

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In a statement, Nikola highlighted its achievements in the second quarter, particularly in the production and delivery of hydrogen fuel cell electric vehicles (FCEVs). "In Q2, we exceeded the high end of the guidance range by delivering 72 hydrogen fuel cell electric vehicles (FCEVs) to our dealer network," the company stated. This brings the total number of wholesaled FCEVs to 147 in the first three quarters of serial production.

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Regarding its battery-electric trucks, Nikola reported continued progress in returning these vehicles to its dealer network and fleet users following a recall that was announced a year ago.

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Despite the recent positive developments, Nikola’s stock has experienced a challenging year. Year-to-date, the stock has plunged by 67.3%, a sharp decline compared to broader market benchmarks. In contrast, the Global X Autonomous & Electric Vehicles ETF, which includes a range of companies in the electric vehicle sector, has dropped by 14.2%. Meanwhile, the S&P 500 index has gained 11.4% over the same period.

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This recent uptick in Nikola’s stock price represents a welcome change for investors, who have endured a volatile year marked by significant losses. The company’s ability to narrow its losses and exceed revenue expectations suggests that it may be on a more stable footing as it moves forward. However, the road ahead remains challenging, particularly in the highly competitive electric and hydrogen-fuel-cell vehicle markets.

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Nikola's recent performance reflects its efforts to overcome past challenges and rebuild investor confidence. The company's success in increasing production and shipments, along with its ability to meet and exceed revenue targets, indicates progress in its operational strategy. However, given the stock's dramatic decline over the year, sustained improvement will be necessary to fully restore investor trust.

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In summary, Nikola Corp.'s latest financial results have provided a much-needed boost to its stock, which had been under significant pressure. The narrowing of losses, coupled with a substantial increase in revenue and production, highlights the company's efforts to regain its footing in the market. As Nikola continues to navigate the competitive landscape of electric and hydrogen-fuel-cell vehicles, investors will be watching closely to see if this positive momentum can be sustained.

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