(Reuters) -Self-driving technology company Mobileye Global warned on Thursday that a pullback in orders from customers clearing excess inventory will batter its revenue this year, sparking a selloff in the shares of auto chip suppliers.
Shares of the Israel-based company, whose customers include Volkswagen and Porsche, tumbled 26.3% to $29.28 in premarket trading.
Mobileye forecast preliminary 2024 revenue below estimates showing that the automotive chip industry, which had so far avoided the chip supply glut crisis, will likely face a downturn too.
Shares of auto chipmakers such as NXP Semiconductors, Onsemi, Texas Instruments and Wolfspeed were down between 2.0% and 3.8%.
“As supply chain concerns have eased, we expect that our customers will use the vast majority of this excess inventory in the first quarter of the year,” Mobileye said.
The company expects revenue in the first quarter of the year to fall about 50% from a year earlier.
Estimating an excess supply of 6 million to 7 million units of its EyeQ advanced driver-assistance chips at its customers, Mobileye said it expects first-quarter profit to be “significantly below the subsequent quarters”.
Mobileye, whose parent company is Intel, forecast 2024 revenue between $1.83 billion and $1.96 billion, compared with estimates of $2.58 billion, according to LSEG data.
(Reporting by Chavi Mehta in Bengaluru; Editing by Shounak Dasgupta)
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