Mullen Automotive Cuts Costs, Projects Revenue Growth

Mullen Automotive has announced significant reductions in operating expenses, slashing costs by $5.5 million per month. The company aims to achieve $12.5 million in average monthly revenue over the next six months, totaling $75 million from its commercial and Bollinger Motors operations.

Date: 07-10-2024

AI Rating: 6

Mullen Automotive (MULN) has taken critical actions to shore up its financial position by reducing operating expenses from over $12.8 million to $7.3 million, representing a significant monthly savings of $5.5 million. This strategy includes a 20% workforce reduction, discontinuing its Mullen FIVE passenger vehicle program, and consolidating facilities through lease terminations and subleasing non-essential property.

The decision to cut costs indicates the company's effort to manage its resources amidst potential financial strain. While the move is undeniably drastic, particularly with the job cuts, it may be necessary for long-term sustainability. Investors will be closely monitoring these developments for signals of overall financial health.

In parallel, Mullen anticipates ramping up its revenue to an average of $12.5 million per month over the next six months, which equates to a total projected revenue of $75 million from both Mullen Commercial and Bollinger Motors sales avenues. This projection presents a proactive outlook aimed at restoring operational vigor.

However, the success of this strategy will depend on the execution of its cost-cutting measures and the actual realization of the projected revenues. If achieved, this could signal a strong rebound for investors; otherwise, continued financial challenges could adversely impact stock prices.

Stocks: MULN