Mobileye (NASDAQ:MBLY) is one of the top-trending tickers on social media and business news websites, and MBLY stock is down about 20% today. The selloff was triggered by the firm’s announcement of a reduction in its 2024 revenue guidance.
On a positive note, Mobileye noted that its revenue had soared 84% last quarter compared with the first quarter.
Mobileye’s Guidance Reductions
Mobileye cut its 2024 sales guidance to $1.6 billion to $1.8 billion from $1.83 billion to $1.96 billion.
China’s automakers have reduced their orders from Mobileye because, with China’s economic growth slowing sharply, the country’s consumers have been buying fewer vehicles, the company explained.
As a result of the latter trend, Mobileye’s guidance now calls for the firm to ship 28 million to 29 million of its EyeQ chips in 2024. Previously, the firm had expected 31 million to 33 million of the chips, which facilitate advanced driver assistance systems, to be shipped this year.
The chipmaker also lowered the 2024 guidance for the shipments of its more advanced SuperVision chip to 110,000 to 130,000 from its previous outlook of 175,000 to 195,000.
Calling the Chinese auto sector “very, very volatile,” CEO Amnon Shashua explained that the company’s new guidance reflects the “worst-case” scenario.
Mobileye’s Quarterly Results
The company’s revenue soared 84% in Q2 compared with Q1 to $439 million, as the number of systems that it shipped more than doubled quarter-over-quarter. Mobileye reported that its customers’ high inventories, which had previously negatively affected its quarterly results, had “normalized.”
Bank of America Remains Bearish on MBLY Stock
In the wake of Mobileye’s announcements, Bank of America believes that the company’s outlook is uncertain. The bank thinks that the company will face mounting competition going forward, and it kept an “underperform” rating on the shares.
In the last three months, the shares have slid 44%, and they have sunk 61% so far in 2024.
On the date of publication, Larry Ramer did not hold (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.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
