Fisker Going Concern Status Clouds Future of FSR Stock

Fisker's going concern status is causing uncertainty for investors, with FSR stock prices fluctuating as a result.

The company's financial struggles have led to a warning from its auditor, citing substantial doubt about Fisker's ability to continue as a going concern.

Fisker's cash burn rate is a major concern, with the company burning through $1.4 billion in cash in the first nine months of 2022.

The company's reliance on external funding to stay afloat has raised questions about its long-term viability.

Explore further: Fisker Outstanding Shares

Fisker is struggling to deliver cars to its customers and has faced software problems and a daunting cash burn.

The company carries more than $1 billion in debt.

Fisker's earnings release for the fourth quarter raised substantial doubt about its ability to continue as a going concern.

Shares of the company trade well below $1 apiece, putting Fisker in danger of being delisted by the New York Stock Exchange.

Henrik Fisker, the company's CEO, thinks the stock is grossly undervalued, but the company's financial struggles are a major concern.

Fisker is trying to start selling cars through dealers and seek outside investment from a large automaker, reportedly Nissan.

A different take: Fisker Stock Quote

Fisker is currently in talks with a large automotive company regarding a partnership, with Reuters reporting that Nissan is in advanced talks to invest over $400 million into Fisker's truck platform.

The company is focused on raising additional capital and transitioning to a dealer-focused model in North America and Europe. Fisker is also addressing its liquidity concerns by holding talks with an existing noteholder involving an additional investment.

Fisker's stock is considered a risky investment, as raising capital would dilute shareholders. A bankruptcy would have devastating effects, but no new information was provided regarding the restructuring advisors.

The company is planning to manufacture Fisker's upcoming Alaska pickup truck at one of Nissan's U.S. plants starting in 2026, pending the deal's closure. A term sheet has already been prepared, and a deal could close by this month.

Fisker's cash flow is a major concern, as the company announced it might not have enough money to survive another year. Fisker lost $463.6 million in the 4th quarter of 2023, despite taking in $200 million in revenue.

The company's financial struggles are compounded by its $1 billion in debt. Fisker's stock was trading at 75 cents a share at the close of trading Thursday and dropped to a little more than 40 cents this morning.

Fisker is trying to cut costs by laying off 15% of its workforce. This move is aimed at reducing expenses and increasing the company's chances of survival.

The company's manufacturing model, which outsources production to Magna, has also been a source of delays and issues. Last year, Magna produced over 10,193 Fisker SUVs, but fewer than half of those were delivered to customers within the calendar year.

Fisker expects to deliver about 20,000 SUVs this year, but it's unclear if the company will be able to meet this goal. The company's financial struggles have raised concerns about its ability to continue as a going concern.

Fisker Inc. has been making headlines lately, and for all the wrong reasons. The company filed for Chapter 11 bankruptcy on June 18, 2024, with estimated assets between $500 million and $1 billion and estimated liabilities between $1 billion and $10 billion.

Fisker's financial struggles have been well-documented, with the company facing a probe by the US securities regulator in April 2024. This was just one of several issues the company faced, including a recall of over 8,000 Ocean vehicles in June 2024.

The recall was not the only issue Fisker faced, as the company also struggled to sell its Ocean EVs at a price of $14,000 per SUV. This was a significant drop from the company's initial plans to sell the vehicles at a higher price.

Here are some key dates in Fisker's recent history:

Fisker's financial struggles have been a long time coming, with the company's financial woes dating back to at least June 2024. The company's bankruptcy filing is a significant setback for the electric vehicle industry, which has been struggling to gain traction in recent years.