Polestar Shares Plummet Following Reverse Stock Split

Shares of Swedish electric vehicle manufacturer Polestar experienced a sharp decline last week. The company's American Depositary Shares (ADS) dropped 19% in the wake of a 1-for-30 reverse stock split. This pronounced sell-off highlights persistent investor skepticism regarding the automaker's path to profitability.

The corporate action was implemented as a necessary step to comply with Nasdaq listing requirements. The exchange had issued a warning to Polestar in late October after its share price fell below the minimum $1 threshold. Despite this technical compliance measure, the market response was decisively negative.

Recent quarterly results underscore the company's ongoing challenges. For Q3 2025, Polestar reported an adjusted EBITDA loss of $561 million. While this figure represents a slight year-over-year improvement, it clearly misses the company's stated target of achieving positive adjusted EBITDA for the full year 2025.

Should investors sell immediately? Or is it worth buying Polestar Auto.adr/a?

Key financial and operational metrics from the period include:
* A 13% increase in vehicle deliveries to 14,192 units for the third quarter.
* A quarterly net loss of $1.6 billion, driven primarily by impairment charges.
* Revenue of approximately $2.2 billion for the first nine months of the year.

Market Experts Maintain Cautious Outlook

Within the context of a fiercely competitive EV market and complex global supply chains, analysts see no clear path to profitability for Polestar within the next three years. This prevailing assessment continues to weigh on market sentiment. Although the expansion of its model lineup with the Polestar 3 and Polestar 4 is intended to drive growth, the company's cash flow remains negative.

The next critical test will arrive with the publication of full-year 2025 and Q4 results in spring 2026. Management reaffirms its volume target of 30-35% annual delivery growth through 2027. For a sustained recovery in its share price, however, the company must demonstrate a credible strategy for achieving profitable growth and generating positive operational cash.