Fisker raises 'substantial doubt' as a going concern after $463 million Q4 net loss; 15% work force cut planned

Electric vehicle startup Fisker Inc. said Thursday that there is "substantial doubt about its ability to continue as a going concern" after reporting a fourth-quarter net loss of $463 million and announcing a 15 percent cut in its work force.

Fisker reported $200 million in revenue in the fourth quarter but said it needs additional resources to continue with its business plan. The company said it had cash and cash equivalents of $396 million along with vehicle inventory and raw materials valued at approximately $530 million as of Dec. 1.

CEO Henrik Fisker said on the fourth-quarter earnings call that the company is negotiating with an unnamed "large automaker" for a strategic partnership. He also said the startup would rely on its nascent franchised dealership network to help with sales after moving away from its direct-sales model early this year.

The automaker said it delivered 3,818 Ocean crossovers in the fourth quarter and 4,929 in all of 2023. The Ocean is Fisker's first vehicle and launched in June in North America and Europe.

"2023 was a challenging year for Fisker, including delays with suppliers and other issues that prevented us from delivering the Ocean SUV as quickly as we had expected," Henrik Fisker said on the earnings call.

"The EV industry is going through a turbulent and unpredictable period, so we want to start this year with a more prudent plan."

Fisker Inc. is forecasting global Ocean deliveries of 20,000 to 22,000 in 2024. The automaker had originally forecast 2023 production as high as 36,000, but the final number was just over 10,000. With just about half of those delivered last year, Fisker ended 2023 with a sizable inventory.

In its earnings report, Fisker said it may be forced to reduce operations and cut more jobs without additional financing.

"To the extent Fisker’s current resources are insufficient to satisfy its requirements over the next 12 months, the company will need to seek additional equity or debt financing, and there can be no assurance that Fisker will be successful in these efforts," the company said.

"As a result, the company expects to conclude there is substantial doubt about its ability to continue as a going concern when its annual financial statements for the year ended December 31, 2023, are filed with the SEC," Fisker said.

The company's stock price fell 36 percent to 47 cents in after-hours trading. Over the past 12 months, Fisker's share price is down about 90 percent. The New York Stock Exchange issued a noncompliance notice in February because Fisker's stock price had closed below the $1 minimum average price for 30 straight days.

Henrik Fisker said negotiations with an automaker partner have been going on for months but would not name the automaker. He said Fisker had been in preliminary talks with several automakers some months ago but is now focused on just one.

"Fisker is in negotiations with a large automaker for a potential transaction which could include an investment in Fisker, joint development of one or more electric vehicle platforms, and North America manufacturing," the automaker said in a press release.

Last year, Fisker unveiled concepts for an electric pickup, the Alaska, and a small crossover, the Pear. But the projects depend on an automaker partnership.

"We are not planning to start external expenditure on our next projects until we have a strategic OEM partnership in place,” Henrik Fisker said.

Before its earnings report Thursday, Fisker said it had signed six U.S. dealers since announcing the shift to third-party retailers in early January. The company said it expects more dealers to sign in the coming weeks.

Henrik Fisker said the automaker had received "250 expressions of interest" from dealers in North America and Europe and expects to have 100 U.S. dealers by the end of the year and 50 to 60 in Europe.

"The dealers we are signing up right now, we are moving vehicles straight into their showrooms, putting up a new sign, and they're open for business," Fisker said. While there is negative sentiment toward EVs in some quarters, the opposite is true for Fisker dealers, he said. "We have actually seen them being super excited."