Nikola falls despite profit drop; that’s how the stock works

The share of Nikola (NLKA) is trading lower on Tuesday after the publication of the results for the second quarter. The electric and hydrogen truck startup released the following results when compared to Bloomberg’s consensus estimates for the month ended June.

Adjusted Earnings (Loss) Per Share: -20 cents versus -30 cents estimates

Adjusted Ebitda Loss: $73.90 million compared to an estimated loss of $116.9 million

“We have had continued success in commissioning and validating the Nikola Tre BEVs, completing both our Ulm, Germany and Phase 0.5 of our Coolidge, Arizona manufacturing facilities,” Nikola’s CEO Mark Russell said in a statement.

He also highlighted Nikola’s acquisition of a 20% stake in Wabash Valley Resources’ clean hydrogen project in West Terra Haute, Indiana.

Nikola’s founder Trevor Milton was recently charged with allegedly making false statements to investors about the electric vehicle company. The stock fell about 10% the day prosecutors indicted Milton. “Trevor Milton is innocent,” his lawyers said in a statement.

Nikola went public in 2020 via a SPAC and shortly after was given questions and control over the production and promises to investors.

The company’s stock had hit an all-time high last year amid investor buzz about the EV industry and following an announcement of a partnership with General Motors (GM). That deal was later slimmed down after a damning short seller report by Hindenburg Research against Nikola and its founder. The company initially denied Hindenburg’s claims. Later that month, Milton stepped down as executive chairman and closed the Twitter account he had used to communicate with shareholders and to promote Nikola.

Earlier this year, the company said in an internal review that Nikola and Milton had made several false statements. Year-to-date, the stock is down about 26%.

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Ines covers the US stock market. Follow her on Twitter on @ines_ferre

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