In a development that has come as a major blow to BE stock, Bloom Energy Corp (NYSE:BE) announced late Wednesday that there has been a major accounting error in its records. This means that all of Bloom’s financial results that have been declared since its initial public offering will need to be restated.
According to reports, Bloom Energy will now need to subtract between $165 million and $180 million from its revenue figures. The subtraction is going to be spread out over several quarters going back until Q2 2018.
The revenue originally reported from these quarters equaled $1.24 billion, so the subtraction will end up reducing revenue by as much as 15%.
Over the past three months, BE stock performed admirably and gained as much as 88% in that period until Wednesday close. During this same three-month period, the S&P 500 index gained only 8.6%.
Now that Bloom Energy has reported this accounting error, however, all those gains are now in danger of being reversed. Already, BE stock has sunk by more than 10% to $9.43 in Thursday’s trading.
In September of last year, a short-seller report raised questions about the accounting practices at the company, and at the time, BE stock plunged to $3.00 from its listing price of $15.00. It seems investors should have taken these questions more seriously, given the latest announcement from Bloom.
Troubles have been stalking Bloom Energy for some time now. New provisions in the clean energy standards have resulted in a shutdown of Bloom Energy’s workforces for some time, and it’s unclear still have things are beginning to proceed.
With this accounting error, a significant chunk of revenue is now going to be taken off the company’s books, so it’s no surprise that BE stock has fallen like this. The question now becomes—how much further is the stock going to drop?
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