Symbotic (SYM, Financial) is feeling the heat—big time. Shares cratered 38% this morning after the company dropped a bombshell: an accounting error tied to revenue recognition is forcing it to delay filing its annual 10-K report for fiscal 2024. Translation? Those shiny revenue and profit numbers it flaunted earlier are now taking a $30–$40 million haircut. This isn't just a one-quarter hiccup, either—it's rippling across multiple quarters, slashing adjusted EBITDA and gross profit in the process. To make matters worse, Symbotic also downgraded its Q1 2025 outlook, cutting revenue expectations to $480–$500 million and slashing adjusted EBITDA projections nearly in half.
Analysts wasted no time reacting. DA Davidson yanked its "Buy" rating, downgrading Symbotic to "Neutral" and trimming its price target to $35. The market? Let's just say it responded like a bad episode of reality TV—sheer chaos. Investors are spooked not just by the numbers but by what they reveal: internal controls that weren't up to snuff. Symbotic says it's taking steps to fix the mess, but confidence doesn't bounce back overnight. This stumble comes at a tough time, too, as the company tries to scale its AI-powered warehouse systems while maintaining credibility in the cutthroat robotics space.
Still, it's not all doom and gloom. Symbotic's AI systems and partnerships, like the high-profile deal with Walmart Mexico, still have big upside. The $400 million backlog boost from that deal is a silver lining, even as macro pressures weigh on the broader business. Investors now face a tough choice: cut and run, or hold tight and hope Symbotic can clean house and recapture its growth mojo. Either way, this accounting drama is a wake-up call for the company—and a stress test for its investors.
