Polestar Automotive Holding UK PLC announced a one‑for‑thirty reverse stock split of its American Depositary Shares (ADS) that will take effect before the end of 2025. The move is intended to raise the share price above Nasdaq’s $1.00 minimum bid requirement and keep the company listed on the U.S. exchange.
Polestar’s latest quarterly results illustrate the financial pressure that prompted the split. In the third quarter of 2025, the company generated $748 million in revenue—up 36% year‑over‑year—but posted a net loss of $365 million, a widening of $42 million compared to the $323 million loss in the same period a year earlier. Gross margin for the quarter was a steep –61.08%, reflecting the combination of high production costs, tariff‑related expenses, and a pricing environment that has not yet allowed the company to achieve profitability.
The preceding quarter, Q2 2025, saw revenue of $1.4 billion, a 56% increase from the $1.0 billion reported in Q2 2024. Despite the revenue growth, the company recorded a net loss of $1.193 billion, driven largely by a $1.1 billion impairment charge related to its vehicle manufacturing assets. The loss margin widened from the $1.0 billion loss in Q2 2024, underscoring the persistent cash burn.
Management emphasized that the reverse split is a cosmetic measure and will not alter shareholder value. CEO Michael Lohscheller said, “As market conditions remain challenging, we continue to take steps to make our organization and operations more efficient.” CFO Jean‑François Mady added, “The result of Q3 has been clearly disappointing for us… we are continuing suffering pricing pressure on our vehicles in addition to having a higher cost of production due to the duties.”
Polestar’s strategy has shifted toward a dealer‑focused sales model and a stronger emphasis on the European market, where demand for its Polestar 3 and Polestar 4 models remains more robust than in the United States. The company has also been working to reduce production costs, streamline its supply chain, and secure additional equity financing to support its growth plans amid tariff headwinds and high manufacturing expenses.
Investor sentiment has turned negative following the announcement, with market participants citing the company’s persistent net losses, negative gross margins, and the perception that the reverse split does not address underlying business challenges. The reaction reflects concerns that the company’s financial trajectory remains unsustainable without a clear path to profitability.
Polestar has not issued new guidance for 2025, but it continues to seek equity and debt financing to shore up its balance sheet. The company’s focus remains on cost discipline, operational efficiency, and expanding its European sales network, while it navigates the competitive electric‑vehicle landscape and ongoing regulatory pressures.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.