Mobileye shares crash on forecast for 50% drop in Q1 revenue

Mobileye forecast preliminary fiscal 2024 revenue below estimates on Thursday as the autonomous driving tech company expects its customers to pull back on orders as they clear excess inventory.

Shares of the Israel-based company, whose customers include Volkswagen and Porsche, tumbled 26% in premarket trading.

"As supply chain concerns have eased, we expect that our customers will use the vast majority of this excess inventory in the first quarter of the year," Mobileye said.

The company expects revenue in the first quarter of the year to fall about 50% from a year earlier.
Mobileye forecast fiscal 2024 revenue between $1.83 billion and $1.96 billion, compared with estimates of $2.58 billion, according to LSEG data.

“We currently expect Q1 revenue to be down approximately 50%, as compared to the $458 million revenue generated in the first quarter of 2023,” the company said. “We also currently believe that revenue over the balance of the year will be impacted by inventory drawdowns to a much lesser extent. As a result, we expect revenue for Q2 through Q4 2024 on a combined basis to be roughly flat to up mid single-digits as compared to the same period in 2023, and we expect inventory at our customers to be at normal levels by the end of 2024.”

Mobileye explained that it became aware of excess inventory following discussions with its Tier 1 customers to determine potential orders for 2024. “Based on our discussions, we understand that much of this excess inventory reflects decisions by Tier 1 customers to build inventory in the Basic ADAS category due to supply chain constraints in 2021 and 2022 and a desire to avoid part shortages, as well as lower than-expected production at certain OEM’s during 2023.”