Nikola Q3 Losses Halve as Hunt for More Funding Ramps Up
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Losses at truck maker Nikola Corp. more than halved year on year in the third quarter as a result of record sales, cost cutting and the absence of expenses incurred in the year-ago period.
However, executives said the continued losses meant the company’s cash reserves would only last partway through the first quarter of 2025 without successful fundraising efforts or additional partnerships.
Nikola reported a loss of $200 million in Q3 on Oct. 31, compared with $425.5 million in red ink in the same period a year earlier, which came partly as a result of a $145.7 million hit on the revaluation of financial instruments.
Phoenix-based Nikola shipped 90 hydrogen fuel cell electric trucks in the most recent quarter, compared with three in the year-ago period. As a result, the company reported $25.2 million in revenue in Q3, compared with a hit of $1.7 million in the year-ago period.
The company’s total cost of revenue from manufacturing the trucks in the three months that ended Sept. 30 was $87.1 million, down 29.6% from $123.8 million in the 2023 period.
But Nikola’s cash and cash equivalents as of Sept. 30 totaled $198.3 million, compared with $464.7 million at the end of 2023.
“We estimate that our existing cash is sufficient to fund our forecast operating costs and meet our obligations into but not beyond Q1 2025,” Chief Financial Officer Tom Okray told analysts during the company’s quarterly earnings call.
“We are examining every opportunity to optimize cash,” said Okray, who joined Nikola in March, adding: “We continue to seek to maintain sufficient capital to support our business.”
That may include partnerships, according to CEO Steve Girsky.
“We are actively talking to lots of potential different partners who value what we do and value what we’ve built. It’s because we’ve been doing the hard work out front building the framework, and we have proof points. We’re on the road today with customers,” the company’s top executive told analysts.
“So, we are looking to build [a] coalition of the willing, [a] coalition of like-minded companies that want to pursue and push zero-emission forward because that’s all we do,” said Girsky.
“Companies that value our battery truck that have value range versus others and user experience, companies that value our fuel cell truck, which gives you even more range and less weight, and companies that value … the hydrogen-refueling network we built in California. So, we’re actively pursuing all of them,” he said.
Okray added: “We are looking for these like-minded partners who have stated corporatewide decarbonization goals for the next decade, hydrogen producers who view hydrogen as a viable energy growth vector, and automotive OEMs who bring either light-duty or heavy-duty fuel cells to the market. Together, we form a hydrogen economy that we believe can thrive.”
Nikola is the only Class 8 truck manufacturer to deliver one platform, two powertrains, both zero emissions. This is the future of trucking, as advanced as it is sustainable.#FollowNone #NKLA pic.twitter.com/XehRJ0oB6e — Nikola Corporation (@nikolamotor) October 31, 2024
Nikola previously staved off worries about its finances by raising more than $230 million in the fourth quarter of 2023 after a protracted battle over whether it could issue more shares in order to do so.
Meanwhile, Nikola’s record sales in the quarter included the purchase of 20 FCETs by J.B. Hunt Transport Services as well as adding a customer outside of California or Canada, DHL Supply Chain.
J.B. Hunt, which ranks No. 3 on the Transport Topics Top 100 list of the largest for-hire carriers in North America, will use some of the trucks to support its drayage and intermodal operations in California.
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Germany-based DHL, which ranks No. 5 on the TT Global Freight Top 50, is deploying two Tre FCETs at Diageo North America’s Plainfield, Ill., campus.
Lowell, Ark.-based J.B. Hunt also bought three of Nikola’s battery-electric Tre trucks, all of which were recalled in August 2023.
Nikola overhauled all of the battery-electric trucks after battery fires, and has now returned 78 trucks to dealers and customers since the recall, Girsky said.
The company plans to restart selling some 150 battery-electric trucks currently in inventory at its Coolidge, Ariz., factory in 2025 for the first time since the recall, Girsky told analysts.
Manufacturing of additional battery-electric trucks for the first time since May 2023, when the Coolidge plant was shut down for a retooling ahead of the start of series production of the FCET, would take three to six months of planning, he added, noting the long lead time for components such as high-voltage cables.
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