Company’s Plans for Reverse Stock Split
Automaker Polestar has announced its intention to conduct a reverse stock split in a 1:30 ratio by the end of this year. This step is aimed at complying with Nasdaq’s requirements for a minimum stock price of $1.00. However, the market situation is worsening: today the company’s shares fell by 15.8%, reaching a price of $0.53 per share.
Delisting Warning and Deepening Crisis
Back in early November, Polestar investors received unpleasant news: Nasdaq warned about the risk of the company’s shares being delisted from the exchange because their value had fallen below the required level. At that time, the price was $0.84, but over a few weeks it decreased to $0.53, meaning a drop of almost 37%.
Attempt to Rectify the Situation
Today’s sharp price drop of 15.8% can be explained by the announcement of the plan to restore compliance with exchange requirements. The proposed 1:30 reverse split would increase the stock price to $15.90 based on current data. However, this measure evokes associations with the desperate actions of other EV startups like Mullen, Faraday Future, and Lordstown, which does not inspire investor confidence.
Financial Results and Problems
This news came just two days after Polestar released its third-quarter report, where the company tried to present an optimistic picture. A 36.5% growth in retail sales and the delivery of 44,482 cars in the first nine months of the year, along with a 48.8% increase in revenue to $2.17 billion due to carbon credit sales and more expensive models, are positive points. But at the same time, the company incurred a net loss of $1.56 billion, significantly exceeding last year’s losses, and faces tariffs and pricing pressure.
Future Prospects
Despite financial difficulties, Polestar has plans for the future. The company recently introduced the updated Polestar 3 model and the all-new Polestar 5, and also began a campaign announcing the Polestar 7, whose launch is scheduled for 2028. This model will likely be built on the new SPA3 platform and manufactured at the plant in Košice, Slovakia, which could be an important step for strengthening the brand’s position.
Financial indicators show that Polestar is at a difficult stage, where positive shifts in sales are accompanied by significant losses. The planned reverse split may temporarily solve the stock price problem, but long-term success will depend on the company’s ability to reduce losses, overcome external challenges such as tariffs, and effectively introduce new models in the competitive electric vehicle market.