Share price of shared micromobility company Bird fell 10.8%, or about two cents, in after-hours trading after the company said it would issue a reverse stock split. The move is Bird’s attempt to get back in line with the New York Stock Exchange after it received a notice of delisting for trading too low.
The news comes a week after Bird reported poor first-quarter results, in which the company recorded a decline in both revenue and passenger numbers. Bird managed to cut costs, but it wasn’t enough to convince investors that the scooter company could become profitable.
The NYSE first issued Bird a listing notice last June after the stock’s price traded below $1 for a period of 30 consecutive trading days. Despite a flurry of cost-cutting measures — including dropping business units, laying off staff, restructuring executives and exiting dozens of unprofitable markets — Bird has failed to return its stock price to compliance territory.
“We heard the message very clearly from our shareholders, a reverse split will increase our chances of attracting investors as we remain focused on our goal of generating cash as a company by 2023,” Bird CEO Shane Torchiana said in a statement. a thesis.
Bird’s stock closed at $0.11 on Thursday. When markets open Friday, Bird will begin trading on a 1/25 split adjusted basis.
As of May 1, there were approximately 286.8 million Class A common stock and 34.5 million Class X common stock. Following the reverse stock split, Bird will hold approximately 11.5 million Class A common stock and approximately 1.4 million Class X common stock. have shares.
Micromobility.com, formerly known as Helbiz, is the only other publicly traded shared micromobility company. At the end of March, the company also executed a 1/50 reverse stock split in an effort to meet the Nasdaq’s minimum price bid of $1. That’s also when the company was rebranded as Micromobility.com.
On March 30, Helbiz’s stock closed at $0.12. When it opened the next day under the new ticker “MCOM”, it was trading at $3.66.
On Thursday, MCOM closed at $0.55, down nearly 85% in less than two months.
Hopefully, for Bird’s sake, Micromobility.com’s failure is not an indicator of how its own stock will perform in the wake of this reverse stock split.