The earnings season is certainly heating up. For investors and traders, these next few weeks provide an exciting time in the markets. However, for investors in MicroVision (NASDAQ:MVIS) and MVIS stock, today hasn’t been as great as many expected.
MicroVision is a company that has been on a downward trajectory for the past six months. Since June, this stock has lost two-thirds of its value, including today’s price action. A healthy 18% drop was seen today, as investors digest earnings reported after the bell yesterday.
Indeed, it appears this earnings season is shaping up to be much more bearish than recent quarters. Various supply chain concerns and decelerating growth are core factors in this assessment. For MicroVision, it appears the numbers have been underwhelming, to say the least.
Let’s dive into what MicroVision reported, and why shares of this lidar stock are plunging today.
MVIS Stock Slumps on Top-Line Miss
Yesterday’s reported third-quarter results appear to really have struck a chord with investors. A stock that’s already put investors on edge, MicroVision simply hasn’t delivered the performance investors expected.
MicroVision’s rather small revenue of $0.7 million came in $0.1 million below estimates. It appears the market was factoring in more substantial growth, especially off a lower base.
That said, the company’s loss per share of 6 cents did come in lower than expected. Analysts were expecting a loss of around 9 cents per share.
Among the real kickers that appear to have taken this stock lower today is MicroVision’s cash burn rate. This quarter, the company used $10 million of cash, approximately three times that of the previous quarter. Yes, the company still has a cash hoard of more than $125 million. Should the company’s cash burn rate continue to accelerate, investors may become more sensitive to future earnings reports.
For now, the company cites growth in the autonomous driving space as reason why MVIS stock is still a great long-term holding. That said, it appears investors are taking a breather today, with risk assets selling off steeply this morning, before recovering into the green this afternoon.
For investors in MVIS stock, it appears more volatility is likely on the horizon. Accordingly, this is a stock I’m on the sidelines with right now.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.