Nikola Corp (NASDAQ:NKLA) shares were down more than 38% in early trading Friday after a report from The Wall Street Journal said the hydrogen and electric truck technology company was close to filing for bankruptcy.
The report, published Thursday, said Nikola was working with advisors to explore options for restructuring its debt.
A spokesperson for the company told The Wall Street Journal that Nikola continues to evaluate its financial position and liquidity needs, with financing options as part of a broader financial restructuring under consideration.
Nikola, which went public via a SPAC merger in 2020, once saw its stock surge to a split-adjusted price of over $2,800 per share.
However, the company’s early years as a public entity were marked by controversy. Nikola initially attracted interest from major players, including General Motors (GM), but faced scrutiny over its technology claims. Founder Trevor Milton was convicted of securities fraud in 2022 after being accused of misleading investors about the company’s progress.