Polestar Initiates Reverse Split After $365 Million Loss Sends Shares Into Freefall

Polestar moved to shore up its financial footing this week after reporting a wider third-quarter loss. The company also announced a reverse stock split aimed at preserving its Nasdaq listing.

Polestar posted a $365 million net loss for Q3 as tariffs, pricing pressure, and higher production costs continued to drag on results.

Company pursues reverse split as losses deepen

Polestar said it will initiate a reverse stock split to mechanically lift its share price above the $1 threshold required by Nasdaq, a step prompted by months of sustained pressure on the stock. The EV maker’s valuation has been hit by U.S. tariffs, model delays, and competitive pricing that have forced deeper discounts across its lineup.

Finance chief Jean-Francois Mady said Q3 results were “clearly disappointing,” noting that the brand continues to face elevated production costs tied to duties and overall pricing softness in the EV market. Polestar also absorbed added pressure from residual value guarantees in North America, a growing challenge as used EV prices decline and lease obligations widen, according to Reuters.

The company has cut roughly 20% of its workforce this year, with recent reductions focused on research and development as Polestar leans more heavily on majority owner Geely for engineering resources. Shares have dropped more than 93% since its 2022 market debut.

Strategy shifts toward Europe as U.S. EV demand cools

Polestar reported a 36% increase in revenue for the quarter, but the gains were overshadowed by margin compression and ongoing cost burdens. The company has reoriented its commercial strategy to emphasize Europe, where demand has remained more stable compared with the U.S., a market now tilting toward hybrids and traditional combustion models.

The brand has shifted to a dealer-focused sales model and trimmed expansion plans, most notably by choosing not to launch the upcoming Polestar 5 GT in the U.S. or China, two of the world’s most lucrative EV markets. Polestar has also been renegotiating debt covenants to maintain compliance with lenders as financial pressure intensifies.

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