Intel stock extends gains after report of possible U.S. government stake
LOS ANGELES - Surf Air Mobility Inc. (NYSE:SRFM) has closed its previously announced registered direct offering, raising approximately $27 million in gross proceeds, according to a press release statement issued by the company. According to InvestingPro data, this funding comes at a crucial time as the company faces significant cash burn rates and maintains a weak financial health score of 1.47 out of 5.
The offering involved the sale of 10,800,002 shares of common stock, or pre-funded warrants in lieu thereof, at a purchase price of $2.50 per share. H.C. Wainwright & Co. served as the exclusive placement agent for the transaction.
Surf Air Mobility indicated it intends to use the net proceeds to pay down certain indebtedness and for general corporate purposes.
The securities were offered pursuant to a shelf registration statement on Form S-3 (Registration No. 333-284845) that was filed with the Securities and Exchange Commission on February 11, 2025, and declared effective on March 26, 2025.
Surf Air Mobility describes itself as a Los Angeles-based regional air mobility platform and one of the largest commuter airlines in the U.S. by scheduled departures. The company operates as the largest U.S. passenger operator of Cessna Caravans, generating revenues of $112.31 million in the last twelve months. However, InvestingPro analysis reveals challenging fundamentals, with negative EBITDA of -$35.84 million. For deeper insights into SRFM’s financial health and future prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
Beyond its airline operations, the company is developing an AI-powered software platform for the Regional Air Mobility industry and working on electrified aircraft technology, including proprietary powertrain technology for the Cessna Caravan.
The offering was conducted through a prospectus supplement and accompanying base prospectus filed with the SEC.
In other recent news, Surf Air Mobility Inc. announced a registered direct offering of 10.8 million shares priced at $2.50 per share, expected to raise approximately $27 million in gross proceeds. The company plans to use the funds to reduce certain debt obligations and for general corporate purposes. Canaccord Genuity recently lowered its price target for Surf Air Mobility to $3.00, citing dilution from the recapitalization, while maintaining a Hold rating due to the stock’s volatility. On the other hand, Piper Sandler raised its price target to $4.00, reflecting optimism about the company’s transformation plan despite a projected 16% decline in fiscal year 2025 revenue. Surf Air Mobility reported operational improvements, including a 10% increase in controllable completion factors and a 21% improvement in on-time performance, as part of its transformation plan. Additionally, the company secured an Essential Air Service contract renewal, providing approximately $9.9 million in subsidy revenue over four years. Surf Air Mobility is deploying the beta version of its SurfOS platform in partnership with Palantir Technologies, which now owns about 20% of the company’s shares. The company aims to achieve profitability in its airline operations this year and is preparing to enter the third phase of its transformation plan focused on expansion.
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