Truck "Tesla" Nikola (NKLA.US) Nearing Bankruptcy, $24B Valuation Vanishes

Intellidex learned that Nikola(NKLA.US) is close to filing for bankruptcy, according to sources familiar with the matter. The electric truck maker's stock fell 20% after-hours to $0.60. Nikola is working with Pillsbury Winthrop Shaw Pittman on a bankruptcy plan that includes selling or restructuring the company. The company has been struggling to raise money and its cash balance has been shrinking as it loses tens of thousands of dollars on each truck sold. Nikola said on Thursday it was evaluating options, including financing as part of a financial restructuring. However, the company declined to comment on whether it was seeking bankruptcy proceedings. Intellidex reported last month that the electric truck maker was exploring options, including selling off parts of the business or the entire company. Nikola's cash and cash equivalents plummeted to $188.3 million as of September 2024, from $464.7 million at the end of 2023. Three months ago, Nikola warned investors on a third-quarter earnings call that its cash would only last through the first quarter of 2025, but not beyond. As of the end of last third quarter, Nikola reported $198 million in cash. Nikola, once known as the Tesla of trucks, has seen its stock price fall more than 99% since its 2020 IPO. The company went public on the Nasdaq in June 2020 at a $12 billion valuation, raising $700 million, and its market value peaked above $24 billion. The stock has fallen below $1 multiple times, forcing the company to do reverse splits to comply with Nasdaq's listing rules.