SAN FRANCISCO - Getaround (NYSE: GETR), a pioneer in the connected carsharing market, has announced the expansion of its debt facility with Mudrick Capital Management, providing the company with an additional $50 million. On Sunday, the company accessed the first tranche of $20 million.
This financial move comes as part of Getaround's strategic efforts to revamp its business operations. Earlier in the year, the company underwent a leadership transition and operational restructuring aimed at establishing a sustainable business model. CEO Eduardo Iniguez expressed confidence that these changes, along with the new funding, demonstrate a commitment to the company's users and the evolving needs of society's mobility.
Jason Mudrick, chief investment officer of Mudrick Capital Management and a Getaround board member, echoed this sentiment. He voiced his increased confidence in the company's direction and its ability to achieve strategic growth and profitability objectives.
Getaround, which began in 2011, offers a peer-to-peer carsharing platform that allows users to rent cars from car owners. The service operates in over 1,000 cities across 8 countries, including the U.S. and Europe, and is designed to provide an efficient alternative to traditional car ownership and rental processes.
This financial development is based on a press release statement.
InvestingPro Insights
As Getaround (NYSE: GETR) secures an additional $50 million in financing to bolster its operations, the company's financial health and stock performance are critical factors for investors to consider. The latest data from InvestingPro sheds light on some key financial metrics that may influence investor sentiment.
Getaround's market capitalization stands at a modest $18.89 million, reflecting the size of the company within the broader market. Despite a notable revenue growth of 22.24% in the last twelve months as of Q4 2023, the company's gross profit margin impresses at 90.64%, indicating a strong ability to retain revenue after the cost of goods sold. However, this has not translated into profitability, as the operating income margin is deeply negative at -136.81%, and the company is not expected to be profitable this year according to analysts.
InvestingPro Tips also highlight that Getaround operates with a significant debt burden and is quickly burning through cash, which may raise concerns about its long-term financial sustainability. Furthermore, with short-term obligations exceeding liquid assets, there is an added liquidity risk that investors should be aware of.
The stock has experienced a decline over the past month, with a 1-month price total return of -28.9%. This performance aligns with the longer-term trend, as the stock has fared poorly over the last decade. These metrics suggest that while the company is growing its top line, the bottom line and stock performance remain areas of concern.
For investors looking to delve deeper into Getaround's financials and future prospects, InvestingPro offers additional insights and tips. With a total of 14 InvestingPro Tips available, users can gain a more comprehensive understanding of the company's position and potential trajectory. To access these insights, consider subscribing to InvestingPro using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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