What happened
Shares of Joby Aviation (JOBY 4.51%) are gaining altitude on Friday following the release of the company's fourth-quarter results. There isn't much to get excited about in the actual results, but the company's progress toward bringing an air taxi to market has the shares up more than 12% on Friday afternoon.
So what
Joby is one of a number of newly public companies working on electric airplanes capable of vertical takeoffs and landings, or eVTOLs. These planes aren't designed to replace the jumbo jets that take passengers overseas or across continents, but rather as so-called air taxis that can overfly traffic jams or provide a green alternative on shorter flights.
Joby's prototype aircraft. Image source: Joby Aviation.
The company reported an adjusted EBITDA loss of $65.2 million in the quarter, reflecting the ongoing costs of development and certifying the aircraft. That was to be expected, since Joby does not expect to launch commercial operations until next year at the earliest.
But Joby impressed markets with its forecast that it will use just $340 million to $360 million of its cash in 2022, a small portion of the nearly $1.3 billion in cash and equivalents on its balance sheet. And the company despite the modest cash burn appears to be on track toward certification of its aircraft, a long and arduous path.
Now what
There is a clear market for eVTOLs, with airlines and ridesharing companies both exploring the technology. But there is also a large number of competitors. Joby was just one of four eVTOL companies to go public via a special purpose acquisition company (SPAC) in 2021 alone, and a number of larger aerospace contractors are also dabbling with designs.
Joby stands out as being perhaps the furthest along toward bringing a product to market, and also for the partnerships it has with larger companies like Toyota Motors and Uber Technologies. There isn't anything in this earnings report that would suggest it is losing that lead.
Aircraft certification is a marathon, not a sprint, and until this company is off the tarmac investors should brace for significant turbulence. But for those intrigued by the eVTOL concept and who would like to make one of the manufacturers a speculative part of a diversified portfolio, Joby's latest results provide no reason not to get on board.
