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Why Lightning eMotors Stock Is Slumping Today

By John Rosevear – Aug 17, 2021 at 11:22AM

Key Points

  • Lightning eMotors said that the auto industry's chip woes have made its near-term outlook uncertain.

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Earnings results weren't what Wall Street had expected.

What happened

Shares of Lightning eMotors (ZEV -2.40%), a maker of powertrains for electric commercial vehicles, were trading lower on Tuesday after the company reported a second-quarter loss that was wider than Wall Street had expected and withdrew its prior guidance for the full year.

As of 10:45 a.m. EDT, Lightning eMotors' stock was down about 12.2% from Monday's closing price. 

So what

Lightning eMotors reported its second-quarter results after the U.S. markets closed on Monday, and it lost more than analysts had expected. The company's net loss was $46.1 million in Q2, or $0.79 per share, on revenue of $5.9 million. Wall Street analysts polled by Thomson Reuters had expected a loss of $0.14 per share on revenue of $5.37 million. 

CEO Tim Reeser said that the company's second-quarter production was constrained by supply chain challenges. Lightning eMotors installs its powertrains in commercial-vehicle chassis made by companies including Ford Motor Company and General Motors. Both Ford and GM had to cut production repeatedly in the quarter amid a global shortage of semiconductors. If Lightning's customers can't get chassis, Lightning can't install powertrains. 

A Ford Transit commercial van with Lightning eMotors logos on the sides.

Lightning eMotors installs electric drivetrains in commercial vehicles like the Ford Transit van. With vehicle supplies constrained amid a chip shortage, Lightning's near-term outlook is uncertain. Image source: Lightning eMotors.

Why is the stock down today? It's probably more about the uncertain outlook than the earnings miss, but both are factors. 

Now what

Lightning also withdrew its prior guidance for the full year, citing the ongoing uncertainties around the chip shortage and the resurgence of COVID-19 infections. The company did say that electric vehicle investors should expect its revenue and production in the third quarter to be similar to the second, and noted that so far, none of its orders have been canceled.

John Rosevear owns shares of Ford and General Motors. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Lightning eMotors, Inc Stock Quote
Lightning eMotors, Inc
ZEV
$0.65 (-2.40%) $0.02
Ford Stock Quote
Ford
F
$13.73 (-2.49%) $0.35
General Motors Stock Quote
General Motors
GM
$39.38 (-2.67%) $-1.08

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