Fisker shares sink 20% after EV maker discloses ‘material weaknesses’ in financial reporting

­­­Shares of electric vehicle startup Fisker sank in morning trading Tuesday after a disappointing earnings report and a regulatory filing that raised concerns about the company’s previous financial statements.

The company’s shares were down more than 20% from their previous close of $4.11 apiece.

Fisker reported its third-quarter results on Monday afternoon, and they weren’t what Wall Street had hoped to see. Revenue of $71.8 million and a net loss of $91 million, or 27 cents per share, that fell short of the Street’s expectations.

But there was more. In a Monday night regulatory filing after its earnings report, Fisker said that following the abrupt departure of its chief accounting officer in October, it “determined that it has material weaknesses in the Company’s internal control over financial reporting.”  

Those weaknesses will delay its quarterly 10-Q filing, it said.

Fisker had originally planned to report its third-quarter results before the U.S. markets opened on Nov. 8. But it abruptly postponed its report early that morning, saying that the departure of its chief accounting officer on Oct. 27 and the appointment of a new one on Nov. 6 had “delayed the completion of the financial statements and related disclosures.”  

The company hasn’t yet explained why its former chief accounting officer left or why its earnings report was delayed, though CFO Geeta Gupta-Fisker said during Monday’s earnings call that the third quarter was “highly complex” because of the company’s global ramp-up.

Monday’s filing raises the possibility that the company could be forced to restate some of its past financial reports.

Fisker noted the “material weaknesses” will be discussed in detail in its upcoming 10-Q report, and Gupta-Fisker said the company is actively hiring additional financial experts. It didn’t say when investors can expect the 10-Q to be filed.

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