Joby Aviation (NYSE:JOBY) saw its shares decline 2.2% to $8.64 on Monday, moving further away from the $11.35 price at which it sold common stock in January. The stock is now approximately 24% below that level and 39% below the $14.19 initial conversion price for its 2032 convertible notes. The broader market, as measured by the SPDR S&P 500 ETF Trust (NYSEARCA:SPY), rose 1.6%, while the iShares U.S. Aerospace & Defense ETF (BATS:ITA) gained 1.0%.
The decline highlights the pressure on Joby as it works toward commercial passenger flights. The company's cash burn continues, with first-quarter revenue of $24.2 million against operating expenses of $257.8 million and a net loss of $110.0 million. Operating cash use was $144.4 million, and capital expenditures on property and equipment totaled $77.9 million. At that rate, the company's $2.466 billion in cash, equivalents, and short-term investments provides roughly 11 quarters of runway.
Joby's share count has swelled to 980.6 million as of March 31, up from 915.1 million at the start of the year, following the public offering, Delta Air Lines' warrant exercises, and employee equity grants. Short interest is another headwind, with Benzinga reporting over 100.7 million shares sold short, representing 15.4% of the float. Peer Archer Aviation (NYSE:ACHR) has an even higher short interest of 18.6%.
Despite the stock's weakness, Joby's balance sheet remains robust. CEO JoeBen Bevirt called it a “very strong balance sheet” in May, noting the company has the “clearest path we’ve ever had” to launching passenger service. The company completed its SR3 audit with the FAA and has parts in production for eight conforming aircraft. Its first FAA-conforming aircraft made a flight during the first quarter.
Joby is targeting production of four aircraft per month by 2027 at facilities in California and Dayton, Ohio, as Reuters reported in March. The company has not announced a new investor event since its June 2 annual meeting, with its Q1 results being the latest headline on its IR page.
The January capital raise, which included both a stock sale and convertible notes due 2032 with a low 0.75% coupon, set key price levels. The capped call top price is $22.70, 61.9% above the current stock price. Joby reported net proceeds of $576.3 million from the stock sale and $669.8 million from the notes, with $63.3 million used for capped calls.
Joby's cash position, at about 30% of its intraday market cap, provides significant financial flexibility, but the stock's slide below key financing levels could make future equity raises more expensive. The company's ability to reach revenue-generating passenger flights before needing additional capital remains a key focus for investors.
