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NEW YORK - UTime Limited (NASDAQ:WTO), a consumer electronics and mobile device manufacturer whose stock has declined nearly 97% over the past year, has closed a registered direct offering of approximately $25 million, according to a statement based on a press release. InvestingPro data shows the company’s market capitalization has dropped to just $1.47 million, with concerning financial health indicators.
The offering consisted of 22,727,275 units sold to five institutional investors at a purchase price of $1.10 per unit. Each unit includes one Class A ordinary share and one Series A warrant to purchase an additional Class A ordinary share at an exercise price of $1.10, exercisable from the issuance date until six months later. The offering price represents a significant premium to the current trading price of $0.07, reflecting the company’s challenging financial position, with a weak gross profit margin of 6.74% and negative EBITDA of $89.32 million in the last twelve months.
Univest Securities, LLC acted as the sole placement agent for the transaction, which was conducted under a shelf registration statement previously filed with and declared effective by the Securities and Exchange Commission (SEC) on June 10, 2024.
UTime specializes in the design, production, and sale of smartphones, feature phones, and related accessories under both OEM/ODM and self-owned brands. The company provides services including hardware design, software customization, and after-sales support.
The gross proceeds from the offering were approximately $25 million before deducting placement agent fees and other offering expenses payable by the company.
The final prospectus supplement and accompanying prospectus describing the offering terms were filed with the SEC and are available on the SEC’s website. For investors seeking comprehensive analysis of UTime’s financial health and 13 additional key ProTips, InvestingPro offers detailed insights into the company’s performance metrics and future prospects.
In other recent news, UTime Limited announced a $25 million registered direct offering, intending to sell 22,727,275 units at $1.10 each. This move is expected to significantly dilute existing shareholders, as each unit consists of one Class A ordinary share and one Series A warrant. The warrants are set to expire six months after issuance, with an exercise price of $1.10 per share. Additionally, UTime Limited clarified that a recent SEC filing claiming management changes was fraudulent and unauthorized. The filing falsely stated that the company’s officers and directors had resigned and been replaced. Furthermore, UTime received a notification from Nasdaq regarding non-compliance with the minimum stockholders’ equity requirement for continued listing. The company failed to maintain the necessary $2,500,000 in stockholders’ equity, as reported in its Form 20-F for the year ended March 31, 2025. UTime also does not meet alternative compliance criteria based on market value of listed securities or net income from continuing operations.
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