Joby Aviation (JOBY) Stock Falls 9% After Announcing $1.2 Billion Capital Raise

TLDR

• Joby Aviation (JOBY) stock dropped 9.1% in premarket trading after announcing a $1.2 billion capital raise through convertible bonds and stock.
• The company priced $600 million in convertible notes at 0.75% interest and $600 million in common stock at $11.35 per share, below the current market price.
• Joby expects to spend approximately $500 million annually as it works toward aircraft certification in the Middle East by mid-2026 and the U.S. by late 2026.
• The convertible notes will mature in 2032 with an initial conversion price of $14.19 per share, representing a 25% premium over the offering price.
• Analysts project Joby will reach $1.2 billion in annual sales by 2029, though only 18% rate the stock as a Buy.

Joby Aviation stock tumbled in premarket trading Thursday after the electric air taxi developer announced it would raise more money than initially planned.

Joby Aviation, Inc., JOBY

Shares dropped 9.1% to $12.15 before the market opened. The company had closed regular trading Wednesday at $13.37.

Joby priced concurrent public offerings totaling $1.2 billion. This exceeded the company’s previously announced target of $1 billion.

The capital raise includes two parts. Joby priced $600 million in convertible senior notes due 2032 with a 0.75% interest rate.

The company also priced 52.8 million shares of common stock at $11.35 per share. That represents a discount to the current trading price.

The stock offering includes an additional 5.3 million borrowed shares from Morgan Stanley. These shares will facilitate hedging transactions by note investors.

Both offerings are scheduled to settle on February 2, 2026. Underwriters received a 30-day option to purchase up to $90 million in additional notes and 7.9 million additional shares.

Conversion Terms and Protective Measures

The convertible notes will mature on February 15, 2032. Interest payments occur twice yearly at the 0.75% rate.

The initial conversion price is $14.19 per share. This represents a 25% premium over the public offering price of the stock.

Joby entered into capped call transactions in connection with the notes offering. The cap price sits at $22.70 per share.

These transactions aim to reduce potential dilution when noteholders convert their bonds to stock.

The company expects net proceeds of roughly $576 million from the stock offering. The notes offering should bring in about $582.9 million.

How Joby Plans to Use the Money

Joby will spend approximately $55 million to fund the capped call transactions. The remaining funds will support several key areas.

The money will go toward certification efforts for its aircraft. Manufacturing operations will receive funding as well.

Commercial operations preparation represents another use of the capital. General corporate purposes round out the allocation.

The company currently spends about $500 million annually as it builds its business. Joby doesn’t generate meaningful sales yet.

The eVTOL maker is working to certify its aircraft for commercial service. Certification milestones in the Middle East are planned for the first half of 2026.

U.S. certification is targeted for the second half of 2026. Once certified, operators can use the electric aircraft to transport passengers short distances.

Wall Street projects Joby will reach $1.2 billion in annual sales by 2029. The stock trades at about 10 times estimated 2029 sales.

Only 18% of analysts covering the stock rate shares as a Buy. The average Buy rating for S&P 500 stocks is 55%.

The average analyst price target stands at $13. Joby stock has climbed roughly 60% over the past 12 months.

Morgan Stanley, Allen & Company LLC and BofA Securities serve as joint book-running managers for the stock offering. Goldman Sachs joined as a book-runner for the notes offering.

The post Joby Aviation (JOBY) Stock Falls 9% After Announcing $1.2 Billion Capital Raise appeared first on CoinCentral.