Why is Polestar Automotive stock sliding today?

Polestar (PSNY) reported H1 2026 retail sales of 30,423 cars, a 39% year-on-year growth in its retail network. Despite revenue declining 4% to $1.36B due to pricing pressures and U.S. restructuring, operating loss reduced by 43%. Cash position stood at $888M. Guidance updated to low-to-mid single-digit volume growth. U.S. operations impacted results, adding $211M to operating loss.

Polestar reduced its full-year delivery forecast due to U.S. restrictions on Chinese-linked vehicles, causing a 5.7% premarket share drop. The company now expects low-to-mid single-digit growth, down from low double-digit. Q2 revenue fell 8% to $727M, with a net loss of $459M, a 55.3% improvement year-over-year. Polestar also reported a negative free cash flow of $1.06B for H1, despite raising $700M in equity.

Polestar introduced the SUV version of its 4 model, addressing the coupe's lack of a rear window. The SUV offers improved range and similar performance, with pricing starting at £54,750 for the rear-drive model, £2,000 less than the coupe. The company saw a 95% sales surge in 2023, driven by the Polestar 4.

Polestar said it will stop selling new cars in the US after the 2027 model year, following a US Commerce Bureau of Industry and Security decision tied to Chinese ownership and technology. Polestar will not appeal and will shift investment toward Europe. It sold 5,747 vehicles in the US in 2023. The company is offering discounts up to $25,000 on Polestar 3 and 4 while working with dealers.

Polestar said it will stop selling new cars in the US from model year 2027 after the US Department of Commerce Bureau of Industry and Security denied approval under the Connected Vehicle Rule. Polestar expects the US was under 10% of global volume, about 5,000 to 6,000 cars. It will focus on Europe, Canada, South Korea and Australia, and continue support for existing owners.

U.S. Senate Commerce Committee plans a July 15 vote on S. 4429, the Connected Vehicle Security Act of 2026, introduced by Sens. Bernie Moreno and Elissa Slotkin. The bill would expand BIS’s January 2025 connected-vehicle rule restricting China- or Russia-linked vehicles, software, and hardware, with software limits from 2027 and hardware from 2030. Polestar said BIS authorization was not granted, so it will stop new US sales from model year 2027.