Faraday Future Intelligent Electric Inc. (NASDAQ: $FFIE) is an American electric vehicle company headquartered in California. Established in 2014, the company aims to produce high-quality electric cars incorporating new cutting-edge technology such as autonomous driving and internet connectivity. Despite financial problems since its inception, Faraday Future is pushing forward to make intelligent, high-performance electric cars a reality.
Faraday Future saw a remarkable surge in its stock price, jumping by 6247.83% to $2.92 on Friday from the previous week’s closing price of $0.046. This resurgence follows a statement made by Jia Yueting, the Chinese founder of Faraday Future, on May 8, 2024.
Yueting Plans to Monetize Intellectual Property
In a video posted on his social media account, Yueting expressed his intention to monetize his intellectual property swiftly to generate funds to pay off the company’s debt and subsidize the construction of cars. His goal is to support the basic operation of FF and restore confidence among investors and shareholders. “The direct reason behind FF’s crisis is a lack of funds, but the root cause is linked to confidence and trust issues,” Jia said. “FF will move faster in raising money, and its Chief Executive Matthias Aydt is advancing major financing and business expansion in the Middle East.”
Netizens speculated that Jia might leverage his large online following, with over 15 million followers on Weibo and 1.4 million on Douyin, to begin livestreaming and selling goods. The serial entrepreneur has garnered a significant social media presence in China.
On April 24, the NASDAQ informed FF that it would be delisted because its stock price had consistently remained below 10 US cents for 10 consecutive trading days. It marked the second time the firm had violated NASDAQ rules. Previously, it had been notified that its shares would cease trading on June 25 due to falling below $1 per share for more than 30 days.
New Executive and Founder’s Aspirations
In late April, Werner Wilhelm joined the company as the Executive Launch Director. During his time at Audi AG, Volkswagen AG, and Magna Steyr, Fisker’s manufacturer partner, Wilhelm successfully managed the launch of three car models.
Jia, renowned in China for his previous failed enterprise, Leshi Internet Information and Technology, left China for the US in 2017 to pursue his car manufacturing dreams. Although his debt issues prevent him from holding management or decision-making power regarding the company’s core finance, legal affairs, or supply chain, Jia stated he might become a co-CEO to save the firm.
Faraday Future (FFIE) Stock Update
On May 17, 2024, Faraday Future is trading at $2.92, showing a 76.97% increase from its last closed price of $1.65. Trading briefly halted after an astonishing 78% surge to $2.95 per share, later hitting $3.01. Despite a year-to-date surge of 291.21%, it remains significantly lower by 94.93% compared to the previous year’s high of $4,980 per share.
The stock’s current trading price is significantly lower than the 52-week high of $117.36 and the 52-week low of $30.03, with an intraday market capitalization of $90.897 million. The 50-day moving average is $30.1278, while the short interest is 36.34 million shares dated April 30, 2024.
Financial Struggles and Path Forward
Faraday Future’s financial woes are apparent, as the company disclosed having $6.7 million in cash by September 30, 2023. Simultaneously, its operational deficit amounted to $66.4 million. Jia and the management are committed to utilizing all efforts to regain adherence to regulations and maintain the listing status.
On May 1, FF appealed, resulting in a 15-day suspension of its securities, which concluded on May 16, 2024. The stock experienced an extraordinary 6,000% increase, coming at a pivotal moment for the company, ensuring its continued listing on the Nasdaq through compliance with requirements.
This year, Faraday Future executed its second reverse stock split in five months, adopting a one-for-three ratio to comply with listing criteria amid financial hardships and supply chain disruptions, which nearly eradicated 99% of its market value in 2023. The company’s securities will stay listed while it seeks to extend the trading suspension pending a hearing with Nasdaq’s Hearings Panel.
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