Symbotic slides on dour forecast as warehouse robotics deployment slows
29/07/2024 21:55
July 29 (Reuters) - Shares of Symbotic SYM.O slumped
more than 13% in extended trading after the robotics vendor
forecast current-quarter revenue and adjusted core profit below
estimates, hurt by higher costs and slowing deployment of its
automation systems.
The Walmart-backed firm builds solutions to automate
warehouses using artificial intelligence software and robots
that can collect, store and retrieve products. It went public in
June 2022 after the company merged with a blank-check firm
sponsored by Japan's SoftBank 9984.T .
"Looking ahead, improving our deployment process may
temporarily slow our revenue growth. However, we expect system
costs to decline and gross margin to return to historical levels
during our fourth fiscal quarter," CFO Carol Hibbard said in a
statement.
The company said its profit margin for the April-June period
was squeezed by elongated construction schedules and
implementation costs.
Symbotic, whose shares have fallen more than 30% so far this
year, had a market capitalization of about $21 billion at
Monday's close after an 8.2% drop.
Walmart, which is Symbotic's third-largest shareholder,
plans to potentially spend $200 million on self-driving
forklifts as part of broader efforts to automate more warehouse
operations, sources told Reuters last week.
The company forecast fiscal fourth-quarter revenue between
$455 million and $475 million, lower than analysts' estimates of
$516.8 million, according to LSEG data.
It expects adjusted earnings before interest, tax,
depreciation and amortization between $28 million and $32
million, lower than estimates of $39.6 million.
(Reporting by Akash Sriram in Bengaluru; Editing by Devika
Syamnath)
((Akash.Sriram@thomsonreuters.com; On X as @HoodieOnVeshti;
+91-74116-87774;))