Phoenix Motor Inc. (NASDAQ:PEV), a manufacturer of truck and bus bodies, has been notified by The Nasdaq Stock Market LLC that it is currently non-compliant with the exchange's minimum bid price requirement. The company's common stock has not maintained the minimum $1 per share bid price over the preceding 30 business days as required by Nasdaq Listing Rule 5550(a)(2).
Despite the deficiency, Phoenix Motor's stock continues to be traded on The Nasdaq Capital Market. Initially, the company was given until October 9, 2024, to meet the requirement but failed to do so. In response, on October 10, 2024, Phoenix Motor requested an additional 180-day compliance period, signaling its readiness to undertake a reverse stock split if necessary.
Nasdaq has granted the company an extension until April 7, 2025, to regain compliance. During this period, if Phoenix Motor's stock achieves a closing bid price of at least $1 for ten consecutive business days, Nasdaq will confirm compliance and close the matter. The company must complete any reverse stock split at least ten business days before the final deadline to regain compliance promptly.
If Phoenix Motor does not demonstrate compliance by April 7, 2025, it may receive a delisting notification, which it can appeal to a Nasdaq Hearings Panel. The company has expressed its intention to monitor its stock's closing bid price closely and to take necessary actions to resolve the deficiency within the extended compliance period.
The information is based on a press release statement and reflects the company's current status and plans regarding its listing on Nasdaq.
In other recent news, Phoenix Motor Inc. reported a record-breaking Q1 with net revenues of $9.4 million and net income of $14.8 million. This significant increase in earnings is largely attributed to the acquisition of a leading zero-emission bus manufacturer, helping Phoenix Motor to secure a 40% market share in North America's electric transit bus market.
Furthermore, the company's total assets have grown to $78.7 million, meeting NASDAQ's listing standards, and a robust order backlog of $200 million is anticipated to contribute significantly to future revenues.
In a strategic move to advance its initiatives in electric and autonomous bus technologies, Phoenix Motor has partnered with the Bay Area Founders Club to establish an Artificial Intelligence development center in Silicon Valley. This partnership is expected to enhance the company's innovation capabilities in self-driving technology and energy management systems for various bus types.
InvestingPro Insights
Phoenix Motor Inc.'s struggle to maintain its Nasdaq listing is reflected in its recent financial performance and market position. According to InvestingPro data, the company's market capitalization stands at a modest $26.91 million, underscoring its small-cap status. Despite a significant revenue growth of 97.81% over the last twelve months, Phoenix Motor is not profitable, with a negative operating income margin of -167.35%.
InvestingPro Tips highlight that the company is "quickly burning through cash" and "may have trouble making interest payments on debt," which aligns with the challenges it faces in meeting Nasdaq's listing requirements. These financial pressures could complicate Phoenix Motor's efforts to boost its stock price above the $1 threshold.
On a more positive note, the stock has shown strong returns over the last month and three months, with price total returns of 58.79% and 70.58% respectively. This recent momentum could be crucial as the company works towards regaining compliance with Nasdaq's minimum bid price requirement.
Investors considering Phoenix Motor should be aware that InvestingPro offers 11 additional tips for this stock, providing a more comprehensive analysis of its financial health and market position.
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