Shares of Faraday Future Intelligent Electric Inc. ( FFIE ) fell in after-hours trading on Tuesday, even as Redditors evidently tried to give them a meme stock-like boost, dragged by the EV startup’s disappointing financial results and a warning letter from the SEC.

What Happened: Faraday Future’s annual report for fiscal year 2023 showed a revenue of $0.8 million, significantly below analyst estimates of $2.59 million. While the net loss narrowed from $602 million in 2022 to $432 million in 2023, it still paints a concerning financial picture.

The company also reported selling only four of its FF 91 Futurist EVs since production began in March 2023, with an additional six leased. It attributed this to “current inclement market conditions” and withdrew its 2024 production guidance.

Cash reserves dropped to $4 million at the end of last year, including $2 million in restricted cash, a sharp dip from the $17 million Faraday had at the end of 2022.

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To address these financial challenges, the company plans to seek additional investors and explore equipment-backed financing to reduce reliance on stock issuance. It has ruled out issuing additional shares unless shareholder approval increases its authorized share count.

SEC Warning And Delisting Threat: Adding to the company’s woes, Faraday Future received a notice from the Nasdaq stock exchange on May 21 regarding its late filing of the 10-Q report for the period ending March 31, 2024. This delay could lead to delisting from the Nasdaq exchange.

The company has requested a hearing to present a plan for filing the report and addressing the stock price deficiency, adding that it remains optimistic that its shares will continue trading during this process.

Reddit Short Squeeze Coming? Faraday Future gained attention in mid-May as it rallied alongside meme stocks such as GameStop and AMC Entertainment. The stock price surged from $0.0460 on May 10th to an intraday high of $3.90 on May 17th, representing an impressive 8,280% gain. However, it has since pulled back.

Following the earnings release, Reddit users on the r/FFIE subreddit — which has 49,000 followers — expressed strong support for the stock. They used familiar tactics associated with meme stock squeezes, encouraging each other to hold and buy the dip.

“Cmon fellow Apes HODLL!!! Buy in the dips! We won day 8!” read one user’s post.

Another called the FFIE family to “unite harder than ever,” adding “This is why we stand tall and don't get scared!”

A third said, “Hold the fort! Don't panic! All is ok. we knew this was happening.”

Why It Matters: It remains to be seen if these online efforts will affect the stock price when the market opens on Wednesday.

According to Yahoo Finance, Faraday Future has 11.99 million shares held as short as of May 15, more than halving from a month back. The short percent of the float is at an elevated 28.27%.

The stock closed Tuesday’s session at $1.17, up 0.86%, according to Benzinga Pro data, before dipping 0.85% in after-hours trading.

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