Published - June 6th, 2023 @ 4:30 PM (CET)
Intel Announces $1.5 Billion Stake Sale in Mobileye
Mobileye Global Inc.'s (NASDAQ:MBLY) shares fell over 5% in premarket U.S. trading after Intel (NASDAQ:INTC) announced its intention to sell a $1.5 billion stake in the Israel-based autonomous driving company. The premarket trading figures were especially significant considering the high-stakes nature of the financial market.
Intel's Reduced Voting Share in Mobileye
In a regulatory disclosure, Intel confirmed its plan to offer 35 million Class A common stock shares in Mobileye. This move will reduce Intel's voting share in Mobileye from the existing 99.3% to approximately 98.7%, a strategic decision that could significantly impact Mobileye's future market performance.
Mobileye's Battle Against Competitors
This development comes amidst Mobileye's struggle to withstand increasing competition in the autonomous driving sector from other semiconductor companies such as Qualcomm (NASDAQ:QCOM) and Nvidia (NASDAQ:NVDA). The ever-increasing competitiveness of the independent driving industry demands constant monitoring for traders and investors alike.
Weak Demand for EVs in China Impacts Mobileye
Mobileye's annual revenue forecast was reduced in April, attributing the cut to the weak demand for electric vehicles (EVs) in China, a crucial automotive market. The Chinese government's 2022 decision to stop EV purchase subsidies has adversely affected car sales in the country, an important factor to consider when analyzing Mobileye's recent financial performance.
Mobileye's Stock Performance
In October last year, Mobileye shares were listed on Nasdaq at $21 per share, ending nearly 40% higher on their first trading day. However, the shares closed on Monday at $42.37, indicating a fluctuating trend in Mobileye's stock market performance.
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