Nikola Corp (NKLA) Q1 2024 Earnings Call Transcript Highlights: Unveiling Financial Strides and ...
Unrestricted Cash Balance: Increased to $464.7 million, highest since Q4 2021.
Net Truck Revenue: $30.1 million for 2023, including 79 battery electric and 35 hydrogen fuel cell electric trucks.
Service and Other Revenue: $5.8 million for 2023.
Gross Loss: Negative $214.1 million for 2023, significantly impacted by battery electric truck recall costs.
Total Operating Expenses: $435.8 million for 2023, with substantial reductions compared to 2022.
Net Interest Expense: $76 million for 2023, including significant one-time non-cash expenses.
Net Loss from Continuing Operations: $864.6 million for 2023.
CapEx: $120.5 million for 2023, primarily for hydrogen fuel cell electric truck production infrastructure.
Q4 Truck Revenue: $12.5 million from 35 hydrogen fuel cell electric trucks.
Q4 Gross Loss: Approximately $38.2 million, with a negative gross margin of 332%.
Q4 Operating Expenses: $89.6 million, within guidance range.
Q4 Cash Use: $129.9 million, below the $140 million target.
Release Date: May 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
Nikola Corp (NASDAQ:NKLA) successfully sold all produced hydrogen fuel cell electric trucks, with each having a designated end user, indicating strong market demand.
The company achieved a 99% share of the hydrogen fuel cell electric truck voucher requests in California, demonstrating a significant market lead and first-mover advantage.
Nikola Corp (NASDAQ:NKLA) has improved its liquidity position significantly, more than doubling its unrestricted cash to $464.7 million and reducing cash usage by approximately 35%.
The company has completed all footprint-related capital expenditures in Coolidge, which is expected to further reduce cash use in 2024.
Nikola Corp (NASDAQ:NKLA) opened its first modular hydrogen fueling station in Ontario, California, enhancing its hydrogen infrastructure and supporting daily customer operations.
Negative Points
Nikola Corp (NASDAQ:NKLA) faced supplier part constraints that limited the number of trucks that could be sold, potentially impacting revenue growth.
The company reported a substantial net loss from continuing operations totaling $864.6 million for the full year.
Gross loss for the year was negatively impacted by the battery electric truck recall, including significant reserves for recall costs and write-downs of inventory components.
Despite improvements, Nikola Corp (NASDAQ:NKLA) still operates at a negative gross margin, with high production costs per unit that need to be addressed to achieve profitability.
The company anticipates continued challenges with supplier delays in ramping up new components for both the hydrogen fuel cell electric truck and modular refueling assets.
Q & A Highlights
Q: Hi, good morning. Thanks for taking my questions. Steve, you had noted that there were no trucks sold for dealer stock inventory. I guess I was curious whether you are getting requests from dealers that inventory. Is there a point where you'll be able to finally fulfill that? Or is customer stocking for demand kind of almost the entire 2024 planned output here? A: (Stephen Girsky, President, Chief Executive Officer, Director) Good morning, Mike. We are still filling customer demand. Right now, we have customers attached to every order. At some point, dealers will have a demo vehicle or something like that. But I think it's going to be a while before they'll be able to start actually physically stock trucks.
Q: Okay. And then on one near term level, you had mentioned a few component constraints. It held back production from curious if you resolve those here in the first quarter or have a line of sight to when that might get targets are resolved on short? A: (Stephen Girsky, President, Chief Executive Officer, Director) So I would say on the truck side, they're starting to resolve. And on the fueling side, the they're actually also starting to resolve with the truck side resolving a little faster.
Q: Okay. And one last one for me on you had mentioned you had those initial slide about how you plan to enter a market with Qorvo and then bring in the permanent hydrogen infrastructure after that kind of ease into it and help manage the local transition. That was very interesting at this point. Do you have any plans for your next market outside of the Arizona, California corridor, you had alluded to Canada and then you've got somewhat higher offtake in the like Midwest. I'd be curious if you've got more in the pipeline here over the next year or two? Or is there still a lot of infill to go within California? A: (Stephen Girsky, President, Chief Executive Officer, Director) Sure. As we look at it this way, we end up fish where the fish are right now, the incentives are best in California and in Canada, there's 30,000 trucks serving the ports in California. There's a big move with all of those trucks to go to zero mission. We want to be in a position of supplying them. We think the market is bright for us in California. We've got plenty of opportunity. And again, like you said, this is about building density, okay. We need to build density to make this work. Will we eventually move out from California? Yes, I'm sure. As we move through the year, there'll be other markets. But right now, California and Canada are our two best markets.
Q: All right, outstanding. Appreciate the help, Pathlore. A: (Operator) Our next question is from Ben Kallo with Baird. Please proceed.
Q: Co-founder and Bob, congrats and the work so far. Just on the just on the you mentioned the port. Could you just talk more about the opportunity there and how you're working on developing that side of it. Closer to the mix was, sir? A: (Stephen Girsky, President, Chief Executive Officer, Director) Yes. So the Board to use, like I said, 30,000 trucks serving the boards, we're attacking those markets. That's where our most of our fuels are going. We think it's an enormous opportunity for us. And frankly, that's where some of the biggest orders were these 35 trucks, a handful went up to Canada, but most of them went to California. It was 10.5, okay? These weren't small bags here. These were big guys, so big opportunity and not only just by the way, the Southern California ports, the Northern California ports. First element will be able I was at our settlement last week with only they're going to be able to fuel 100 plus trucks a day. It's a big opportunity for us and could move to 200. So we think there's a huge opportunity in both Northern and Southern California ports and connecting them.
Q: And what do you think about the part of the pilots with your customers? How do you think they look at their buying pattern as compared to for the total for electric trucks. But just let me like our infrastructure today by awarding five 50 or how do we think about like the cadence of that. I know our customers have right. A: (Stephen Girsky, President, Chief Executive Officer, Director) So first, let me correct something. We sold 10 trucks in two different fleets and five trucks to one. So these were not people. And by the way, one of the people who bought 10 trucks once 40 more, it's been public about that. When you ask them, why are they buying fuel cell truck? Why are they interested their message to us is some basically it's the same weight as many others, electric truck and gets almost three times the range and can refuel faster.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
