TuSimple (NASDAQ:TSP) saw its shares dip on plans to cut 25% of its workforce, a move that affects about 350 of the self-driving truck startup’s workers. Earlier reports had said the company could cut as many as 700 employees as it refocuses on research and development of self-driving trucking technology.
Bank of America reiterated an Underperform on TuSimple Holdings on Thursday after the restructuring announcement . Despite a 25% reduction in the TSP workforce and efforts to preserve cash, the firm sees risks with the operating plan.
Analyst Ken Hoexter and team and team also warned on annual cash burn and its founders super-voting shares which can prevent a value unlock. The loss of Navistar as its partner, the end of revenue testing, and separation with some of its partners while it focuses on building its technology stack are noted to further overhaul the plans.
Earlier this month, TuSimple ended its deal with Navistar in another blow to the company. The deal was for a co-development of self-driving trucks. The development happened despite the company targeting the initial sale of its trucks next year. Again, in October, the FBI and SEC probed the company over links with China’s Hydron Inc.
The wave of negative stock news continues to weigh on the stock, which trades at just $1.60. The company went public in April 2021, with the shares opening at $40.25, above an IPO price of $40 per share.
They opened Thursday lower by eight cents, or 5.6%, to $1.34
