Joby Aviation (NYSE:JOBY) saw its shares decline last week, erasing gains from the initial excitement surrounding its manufacturing joint venture with Toyota Motor Corporation. The stock closed Thursday at $8.49, down 3.9% from the prior Friday's close of $8.83, despite the positive news. Trading volume surged to 207.7 million shares over the four-day week, about 39% above its average daily volume, indicating heightened investor interest.
Joint Venture Details
According to Joby's SEC filing, the newly formed entity, Joby Toyota Aero Manufacturing Preparation Company, is capitalized with $2 million in cash. Toyota holds a 51% stake, contributing $1.02 million, while Joby owns 49% with a $980,000 contribution. Toyota also secures three of the five board seats, giving it control over manufacturing decisions. Joby holds the remaining two seats.
The joint venture is primarily a manufacturing setup, not a short-term capital infusion. The filing notes that a supply agreement for manufacturing, as well as commercial and intellectual property terms, remain to be finalized. Future capital contributions will be determined in a subsequent amended agreement.
Market Reaction and Context
Joby shares initially jumped 7% in premarket trading on Tuesday following the Toyota news, closing the day up 3.36%. However, the stock gave back those gains by Thursday, closing down 3.96% on the day. The broader market showed mixed performance: the Nasdaq Composite fell 0.8%, the S&P 500 was flat, and the Dow Jones Industrial Average gained 1.1% to a record close.
The stock is trading near the lower end of its 52-week range, just 9.5% above the low of $7.75 and about 59% below the high of $20.95. Joby has no scheduled investor events on its calendar.
Key Investor Considerations
A critical detail for investors is that Toyota's next $250 million investment is contingent on closing future agreements, including FAA type certification, production certification, FAA approval for the joint venture as an associate facility, and agreed aircraft orders and production levels. The filing lists several conditions that could terminate the deal.
Joby reported $2.47 billion in cash, cash equivalents, and short-term investments at the end of the first quarter, with net cash used in operations of $144.4 million. The company posted $24.2 million in revenue, primarily from passenger and other services, not from scaled eVTOL passenger flights. Based on its market cap of about $8.35 billion, the market values its operating story at roughly $5.9 billion net of cash, or about 61 times annualized first-quarter revenue.
Peer Comparison
Among eVTOL peers, Archer Aviation (NYSE:ACHR) closed at $4.98, up 1.1%, with a market cap of $3.8 billion. Vertical Aerospace (NYSE:EVTL) ended at $1.85, up 0.5%, with a market cap of $0.4 billion. Both remain in development stages.
Joby's stock performance underscores the market's focus on certification and manufacturing milestones rather than current revenue. The joint venture with Toyota represents a strategic step, but the terms highlight the long road ahead to commercial operations.
