Joby Aviation shares tumble after pricing of $514 million discounted offering

Shares ofJobyAviationfell more than 11% on Wednesday after the electric air-taxi maker priced a $514 million discounted share sale.

The Santa Cruz, California-based company on late Tuesday sold 30.5 million shares at $16.85 per share, representing a 10.9% discount to the stock’s previous close.

Jobysaid it would use the proceeds to support aircraft certification and manufacturing, prepare for commercial operations and fund working capital and other general corporate needs.

Electric vertical takeoff and landing (eVTOL) aircraft firms are racing to secure approvals and bring their vehicles to market, aiming to meet the growing demand for faster, more sustainable urban transportation.

The firm, backed by Toyota Motor, is also expected to benefit fromWashington’s pushto speed air taxi deployment through executive orders and a pilot program which was announced last month.

“Jobyplans to use the proceeds to continue S4 eVTOL aircraft development and its manufacturing ramp on California and Ohio, in addition to preparing commercial operations at vertiports following the acquisition of Blade,” Canaccord Genuity analyst Austin Moeller said.

The companyrecently boughtBlade Air Mobility’s passenger business, planning tointegrateit into the Uberapp as early as next year, and partnered with L3Harris Technologiestodevelop a military aircraft.

Joby’s shares trade at a 12-month forward price-to-earnings ratio of -23.6, compared with -11.4 for rival Archer Aviation, highlighting that both pre-revenue companies continue to trail the broader market.

Joby’s stock had risen 133.7% this year, as of its last close.The company has a market value of $16.3 billion, according to data compiled by LSEG.

Morgan Stanley acted as the sole bookrunner for the offering, which is expected to close on Thursday.