BREA, Calif. - Mullen Automotive Inc. (NASDAQ: NASDAQ:MULN), an electric vehicle manufacturer, announced today a strategic move to enhance its financial position by projecting $75 million in GAAP revenue over the next six months and reducing its monthly spending by $5.5 million. The company's cost-saving measures include a 20% reduction in headcount and the elimination of certain vehicle programs and facility consolidations.
This decision comes as Mullen aims to bolster near-term commercial revenue generation and improve operational efficiencies. The company has three vehicle lines in full production and is concentrating on immediate revenue opportunities. The reduction in operating and investing cash flows, from $12.8 million to $7.3 million per month, is a significant step towards achieving a more sustainable financial model.
Mullen's CEO and chairman, David Michery, expressed confidence in the company's direction, citing the growth in revenue and gross margin as key factors in reducing cash requirements. The company's recent initiatives, including over 80 vehicle demos and pilots, have contributed to commercial sales progress.
In addition to the cost-cutting measures, Mullen has made strides in the electric vehicle market with its Mullen ONE and Mullen THREE models, both of which have received CARB and EPA certifications and are available for sale in the U.S. The Mullen THREE has also gained CARB's HVIP approval, offering buyers up to $45,000 in cash vouchers at the time of purchase.
Mullen Automotive has also expanded its commercial dealer network and announced Foreign Trade Zone status for its Tunica, Mississippi manufacturing center, which provides benefits like deferment of duties owed and elimination of duties on exported vehicles.
The information in this article is based on a press release statement from Mullen Automotive Inc.
In other recent news, Mullen Automotive reported a significant 6791% surge in quarterly revenue, bringing it to approximately $4.5 million for the quarter ended September 2024. The company also completed its first delivery of five Bollinger B4 electric trucks to Nacarato Truck Centers, marking an $800,000 revenue boost. In financial developments, Mullen issued convertible notes and warrants, raising around $12.5 million.
The company's subsidiary, Bollinger Motors, has begun production of the Bollinger B4 electric truck. Mullen Automotive also secured a $3.2 million order from Papé Kenworth for a fleet of commercial electric vehicles. Furthermore, the company received a $210 million order from Volt Mobility, marking a significant expansion in its market reach.
These recent developments highlight Mullen Automotive's transition from pre-revenue product development to revenue generation. The company has expanded its dealer network and initiated a 1-for-100 reverse stock split. Mullen's vehicles have received certification from the California Air Resource Board and the Environmental Protection Agency, qualifying them for federal EV tax credits.
InvestingPro Insights
Mullen Automotive's recent strategic moves to enhance its financial position come at a critical time for the company. According to InvestingPro data, Mullen's market capitalization stands at a modest $4.5 million, reflecting the challenges faced by this niche player in the electric vehicle industry.
The company's aggressive cost-cutting measures and focus on revenue generation align with several InvestingPro Tips. For instance, one tip indicates that Mullen is "quickly burning through cash," which explains the urgency behind the $5.5 million monthly spending reduction and the projected $75 million in GAAP revenue over the next six months.
Another relevant InvestingPro Tip suggests that Mullen "suffers from weak gross profit margins." This is evident in the company's LTM gross profit margin of -1364.48%, underscoring the importance of the company's efforts to improve operational efficiencies and focus on immediate revenue opportunities.
The stock's recent performance has been concerning, with InvestingPro data showing a 1-month price total return of -86.73% and a 1-year price total return of -99.95%. These figures align with the InvestingPro Tip that the "stock has fared poorly over the last month" and highlight the significance of Mullen's current strategic initiatives.
For investors seeking a more comprehensive analysis, InvestingPro offers 18 additional tips for Mullen Automotive, providing deeper insights into the company's financial health and market position.
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