By Akash Sriram and Marie Mannes
(Reuters) -Polestar's new CEO said on Thursday it would take longer for the Swedish electric-vehicle maker to be profitable and delayed its expansion of sales to more countries.
The company's U.S.-listed shares fell nearly 14%.
Polestar (NASDAQ:PSNY), backed by China's Geely, has struggled to increase sales amid declining EV demand and intensifying competition from manufacturers such as Tesla (NASDAQ:TSLA) and Volkswagen (ETR:VOWG_p) Group.
As a result, Polestar last year appointed industry veteran Michael Lohscheller as CEO and several other new executives, including a head of design, board chair, finance chief and chief operating officer.
The company on Thursday announced results of a strategic review, saying it expects positive free cash flow after investments in 2027, later than its previous forecast of the end of 2025.
Polestar previously expected flat revenue for 2024, but now expects a mid-teens percentage decline and negative gross margin.
The company secured more than $800 million last month in 12-month term loan facilities, part of which will be used to repay old loans.
The new funding will take the company's current debt to about $4.4 billion, it said.
It is also working to secure an additional 12-month loan facility of $400 million that is expected to be available to the company later this month.
Polestar's shares have declined 90% since going public in June 2022 and the company received a deficiency notice from Nasdaq last year for falling below the $1 mark.
To resolve this, the company said it is considering a reverse stock split, which typically boosts prices by reducing the number of outstanding shares.
PATH FORWARD
Polestar's ambitious market expansion has also been delayed. The company will start sales in France this year, but delayed its earlier plan to enter more countries this year to 2026 and later.
The EV maker's updated business plan foresees compounded growth in vehicles sold between 30% and 35% in the next three years, with positive adjusted core profit expected this year.
To avoid major tariffs imposed on cars made in China, Polestar has started shifting some manufacturing from the country.
Polestar produces cars in the U.S. and China, and said it is on track to make its Polestar 4 in South Korea in the second half of 2025. The company said it expects its Polestar 7 compact SUV to be produced in Europe.
Following the launch of Polestar 7, the company said it will move to a single vehicle platform to streamline its business to reduce capital investments and development time.
Polestar was spun off from Sweden's Volvo (OTC:VLVLY) Cars, which ceased funding last year.
Polestar provided some results for the third quarter and expects to report delayed fourth-quarter results on March 6.
Revenue in the September quarter fell 10% to $551 million due to increased discounts to counter competition, delays in ramping up sales of new models and lower global sales of the Polestar 2.