Symbotic Inc. is experiencing a significant drop in its stock price following a series of troubling announcements. On November 27, the company revealed it would delay filing its Annual Report on Form 10-K for the fiscal year ended September 28, 2024, due to the need for additional time to assess the financial impacts of errors related to system revenue recognition. These errors have led to a restatement of financial results for the interim quarters of fiscal year 2024, impacting system revenue, gross profit, and adjusted EBITDA by an estimated $30 million to $40 million. The company also revised its revenue outlook for the first quarter of fiscal 2025 to $480 million to $500 million, below the consensus estimate of $507.71 million.
Adding to the negative sentiment, DA Davidson downgraded Symbotic's stock from a "buy" to a "neutral" rating, citing the discovery of further accounting errors. The firm also lowered its price target from $50.00 to $35.00. This downgrade reflects growing concerns over Symbotic's financial reporting and internal controls, which have been identified as having material weaknesses.
Symbotic's stock is down 33.55% pre market, trading at $24.86 as of 9:22 am on November 27, 2024, compared to the previous close of $37.41.