Shares of purpose-built electric vehicle (EV) start-up Canoo (NASDAQ: GOEV) dropped sharply Tuesday morning after the company reported its fourth-quarter and full-year results. It was the first earnings report for the company since it began trading publicly on the Nasdaq in December. As of 10:45 a.m. EDT, shares were down 23%.
For the year, Canoo reported a net loss of almost $90 million, which was about half as much as the company lost in 2019. Red ink on the bottom line is to be expected from Canoo, as it isn’t yet bringing in revenue. The company’s outlook for 2021 didn’t include any specifics that would justify Tuesday’s sell-off, either. But the recent rotation out of growth stocks means investors don’t currently have much of an appetite for pre-revenue start-up EV companies. That could help explain the stock’s decline.