TuSimple shares will vanish from the Nasdaq on Monday. The one-time leader in autonomous trucking software didn’t file two corporate financial reports for 2022 on time.
It’s the newest setback for the San Diego-based startup. TuSimple led the strategy to public trading amongst autonomous trucking software competitor. Its April 2021 initial public offering was priced at $40 a share.
Fame damage takes its toll on TuSimple
Investors have shunned the stock amid a series of blunders that included messy boardroom politics. Co-founder Xiaodi Hou ousted CEO Cheng Lu in a surprise “succession” in March 2022. Lu returned as CEO in November after independent directors fired Hou. The administrators themselves were fired the identical day Lu returned.
The popularity damage cost TuSimple continuation of a two-year manufacturing partnership with Traton Group’s Navistar Inc. in December. The Lisle, Illinois, truck manufacturer was co-developing a purpose-built chassis for TuSimple’s driverless software.
TuSimple began pilot tests of its “driver out” software in December 2021. It plans a limited industrial offering on a route between Tucson, Arizona, and Phoenix by late 2024.
KPMG resignation left TuSimple in a bind
KPMG quit as TuSimple’s auditor in September, also for popularity concerns, just before the planned release of third-quarter 2022 results.
“Despite the fact that my 10-Q is able to go and to be filed, we cannot file it without an auditor,” TuSimple CFO Eric Tapia told FreightWaves in a March interview. “They only didn’t wish to get related to TuSimple because we were deemed high risk, but there’s no questions on our financials.”
Throughout the interview, Tapia indicated an auditor hiring was imminent with the May deadline looming.
The dearth of a 10-Q report and the year-end 10-K for 2022 led Nasdaq to its May 5 decision to delist TuSimple. The corporate was denied an extension.
“The Notice indicated that unless the Company appeals the delisting determination, which it intends to do, trading of the Company’s common stock might be suspended” Monday, TuSimple said in a press release Thursday.
On Wednesday, TuSimple hired London, U.K.-based UHY, a network of accounting firms with 32 offices in eight states, as its recent auditor.
“We consider that choosing and interesting a brand new independent registered public accounting firm is a crucial step,” the corporate said. “The corporate is working expeditiously on an in depth plan to present to the hearings panel in an effort to regain compliance with the listing rule.”
What happens to shareholders when an organization is delisted?
Sharholders typically have a harder time trading a delisted company’s stock. TuSimple will trade over-the-counter, also referred to as the pink sheets. They’ve loose listing requirements and have highly speculative penny stocks.
After trading at one time near $70 a share, TuSimple shares fell under $1 last week, closing Friday at 83 cents as investors shaved 25% of its already-depressed value over the past five trading sessions.
TuSimple “closed the 12 months with near a billion dollars in our balance sheet,” Tapia said.
The corporate issued a shareholder letter and filed an 8-K with the Securities and Exchange Commission for Q3.
TuSimple laid off 350 employees — 1 / 4 of its workforce — in December as a part of a restructuring. The main focus now could be on research and development as an alternative of autonomous freight hauling with safety drivers that cost greater than the revenue it generated.
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