Chinese autonomous vehicle technology company Pony AI Inc. (NASDAQ:PONY) has been on a hot streak, with the stock rallying 315% over the past month, following a string of positive catalysts in recent weeks.
What Happened: During its first quarter earnings call on Tuesday, the company confirmed its partnership with Uber Technologies Inc. (NYSE:UBER) aimed at bringing Pony’s robotaxi platform to international markets.
“We recently partnered with Uber, which will enable users to access our robotaxi service directly through Uber’s platform,” said CEO James Peng. “The partnership is expected to first launch in a key market in the Middle East later this year with the goal of scaling deployments to additional international markets in the future.”
The company is now rapidly expanding outside its home base in China, having secured a Level 4 robotaxi testing permit in Luxembourg and initiated road testing in Seoul's Gangnam District.
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“These successes have provided us with valuable experience as we explore future opportunities beyond the China market,” Peng noted.
During the call, the company highlighted its resilience to tariffs and supply-chain disruptions, citing its “localized strategy.” CFO Liu Wang said, “The majority of our supply chain is domestically sourced,” adding that they enhanced their “supply chain resilience in response to the evolving geopolitical landscape.”
The rally has also been in response to the Pony’s growing scale, with the company reaffirming its target to grow the Gen7 fleet to 1,000 vehicles by year-end.
“Given the structural efficiency advantages of the Gen seven robotaxis, we have [a] clear line of sight to breakeven and long-term profitability,” Peng concluded.
Why It Matters: Recently, fund manager Gary Black, who has been a Tesla Inc. (NASDAQ:TSLA) bull for over a decade, called Pony a great option to “play future advances in global autonomy,” citing its partnership with Uber as the key reason behind the shift in sentiment.
However, Black also cautions that the stock is “clearly overbought,” forecasting a correction over the next couple of weeks.
The stock’s Relative Strength Index (RSI) is now at 61.32, which is “Neutral,” which essentially means that the stock is neither overbought nor oversold, and traders might wait for the RSI to exit this range before considering this stock again.
During its first quarter results, the company reported $14 million in revenue, up 11% year-over-year, with robotaxi revenues growing 200%, at $1.7 million, following significant expansion across major Chinese cities. Pony posted a loss of $0.10 per share, compared to a loss of $0.28 per share in the prior year quarter.
Price Action: The stock is down 3.30% on Wednesday, trading at $17.29 per share, and is down 1.62% after hours. This has been a volatile year, with a 315% rally since its low point in April, but it is still only up 13.82% year-to-date.
According to Benzinga’s Edge Stock Rankings, Pony.ai has a favorable price trend in the short, medium, and long terms, but how does it compare with Tesla and Uber? Click here to find deeper insights.
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