From IPO darling to delisting: Self-driving tech startup TuSimple’s tumultuous journey ends with Nasdaq exit
TuSimple Holdings has decided to delist from the Nasdaq and end its registration with the U.S. securities regulator. This move has led to a 40% decrease in the autonomous driving technology company’s shares during premarket trading.
The news comes just two years after TuSimple fired its co-founder and CEO Xiaodi Hou following an internal probe that revealed links to a Chinese startup. The firing of Hou came a day after The Wall Street Journal published a report citing unnamed sources that TuSimple was facing probes from multiple federal agencies.
The self-driving startup, which went public in 2021, highlighted a decline in its valuation and liquidity, coupled with a significant increase in stock price volatility since its initial public offering. In an announcement on Wednesday, TuSimple attributed these challenges to a rise in interest rates and heightened caution in the market due to macroeconomic uncertainties, impacting investor sentiment for pre-revenue technology companies like itself.
TuSimple anticipates its final day of trading on the U.S. stock exchange to be around Feb. 7. The San Diego-based company had previously disclosed restructuring plans in May, which included layoffs and asset impairments aimed at balancing its cost structure amid a funding crunch in the sector.
The company is currently transforming, and it believes that navigating this process is more feasible as a private firm rather than as a publicly traded one. TuSimple stated, “The benefits of remaining a publicly traded company no longer justify the costs.”
In the nine months ending on Sept. 30, TuSimple reported a loss from operations of $248.6 million, showing improvement from $341.7 million during the same period in 2022, Reuters reported. This improvement is attributed to the company’s efforts in reducing research and development costs and stock-based compensation for employees.
Before going public, the startup raised $120 million in funding to expand long-haul service for fleets and co-develop a commercial self-driving truck with OEMs and Tier 1 suppliers. Today, the U.S. trucking industry is estimated to be around $1 trillion.
Founded in 2015 by Jianan Hao, Mo Chen, and Xiaodi Hou, the San Diego-based TuSimple is a global self-driving truck company. The startup is developing a commercial-ready Level 4 (SAE) fully autonomous driving solution for the logistics industry. TuSimple’s trucks are the first and only capable of self-driving from depot to depot and do so every day for its customers.