Nikola Corp (NASDAQ:NKLA) shares had plummeted by over 27% in afternoon trading Thursday following the announcement of a 1-for-30 reverse stock split.
The split, approved by its Board of Directors, is set to take effect next Monday, June 24.
Shareholders of the electric vehicle manufacturer had previously greenlit the move at the company's annual meeting earlier in June.
The decision comes amid Nikola's struggle to maintain compliance with Nasdaq's listing requirement of a minimum $1 share price.
In conjunction with the reverse split, Nikola will reduce its authorized shares from 1.6 billion to 1 billion in order to streamline the stock structure, affecting equity awards, warrants, and convertible notes without altering the common stock's par value.
Despite earlier hopes for a rebound, Nikola's shares hit a new all-time low earlier this week at $0.45 per share, reflecting ongoing investor concerns.
The company's management, including CEO Mark Russell, faces mounting pressure to stabilize operations amidst broader market challenges and internal restructuring efforts.