Sam is a professional trader and the lead stock market news writer at AskTraders. After starting his career in the forex market, Sam now focuses on gold and stocks with a preference for fundamental and macroeconomic analysis.
Shares of Zymergen Inc (NASDAQ: ZY) have plunged on Wednesday after the company reported issues with its only product and its CEO stepped down.
The company, which IPO'd less than four months ago, said it recently became aware of issues with its commercial product pipeline that will impact its delivery timeline and revenue projections.
Zymergen no longer expects product revenue in 2021 and expects product revenue to be immaterial in 2022.
According to a press release, several key target customers encountered technical issues in implementing Hyaline into their manufacturing processes during the quarter. The issues have caused a delay in the product's “commercial ramp.”
The company is also looking at data on the total addressable market for foldable display applications, which “indicate a smaller near-term market opportunity that is growing less rapidly than anticipated.”
This will impact its sales forecast.
Within the same release, Zymergen announced that Jay Flatley has been appointed Acting Chief Executive Officer. Josh Hoffman has stepped down as CEO and as a member of the board.
“We are disappointed by these developments, and the Board and management team are focused on resolving the underlying issues to ensure Zymergen moves forward as a stronger company with a compelling operating plan,” said Flatley, the Acting CEO and Chairman.
“The Board has formed dedicated committees, including a Strategic Oversight Committee, and is working with outside experts to conduct an in-depth review of the Company’s operational, financial, product, and commercialization efforts to facilitate the development of an updated strategic plan for Zymergen,” he added.
Zymergen's share price has plunged 74.88% on the news, now priced at $8.75.
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