Fisker on Thursday warned it might not be able to continue as a going concern as it struggled to sell its flagship electric vehicle after high interest rates have led to a slowdown in demand, sending its shares down 27% in extended trading.
The company, which missed analysts' expectations for quarterly revenue, also announced plans to reduce its workforce by about 15%.
The EV maker reported preliminary revenue of $200.1 million for the fourth quarter, missing the average analyst estimate of $310.8 million, according to LSEG data.
Fisker's announcements as well as weak production forecasts from EV makers Rivian Automotive and Lucid earlier this month suggest that the industry is in for near-term pain and could slow the transition away from gasoline-powered combustion engines.
"2023 was a challenging year for Fisker, including delays with suppliers and other issues that prevented us from delivering the Ocean SUV as quickly as we had expected," CEO Henrik Fisker said.
The company also said its net loss widened to $463.6 million in the fourth quarter from $170 million a year ago.
Fisker said last month it would add dealerships alongside its direct-to-consumer distribution model to expand its delivery network. So far, Fisker has signed 13 dealer partners across the United States and Europe.
Fisker said its business plan is highly dependent on the successful transfer to its new dealer partner model this year.
The company added that its current resources are insufficient to satisfy requirements over the next 12 months and plans to seek additional equity or debt financing.