Shares of Faraday Future Intelligent Electric Inc. (NASDAQ:FFIE) surged 26% after the company announced that the U.S. Securities and Exchange Commission has closed an inquiry into certain corporate transactions and will not recommend enforcement measures against the company or named executives.
The SEC formally notified Faraday Future, founder and Co-CEO YT Jia, and President Jerry Wang that the enforcement division does not intend to pursue action in connection with matters related to the company's 2021 private investment in public equity (PIPE) and SPAC-related transactions. The company previously received Wells Notices from the SEC - communications that indicate the staff's inclination to recommend civil enforcement but are not formal charges.
In a statement, YT Jia said the company can now redirect its efforts toward executing strategy. "We can now put all our energy into strategy execution," he said, noting the firm invested significant time, effort, and resources cooperating with the inquiry over the past five years.
Faraday Future also confirmed it received a notice from Nasdaq on March 20 establishing a 180-day compliance window to meet the exchange's minimum $1 per-share listing requirement. Management stated its intent to seek compliance without employing a reverse stock split.
On the product front, the electric vehicle maker has begun deliveries of its flagship FF 91 model, a program that started in 2023. The company has announced plans to launch a second brand, FX, and intends to deliver the first FX model, the Super One, in 2026. In addition to automotive efforts, Faraday Future disclosed an expansion into the robotics sector, with sales under that initiative slated to begin this year.
Investors reacted positively to the SEC's decision, driving the notable intraday gain. The company now faces two immediate operational priorities: addressing Nasdaq's compliance notice within the provided timeframe and proceeding with announced vehicle and robotics rollouts.
Contextual notes
- The SEC notification covers the company and two executives by name - YT Jia and Jerry Wang - related to 2021 PIPE and SPAC matters.
- Wells Notices previously issued by the SEC signaled a potential recommendation for enforcement, but they are not formal charges.
- Nasdaq has given Faraday Future a 180-day window to meet the minimum $1 per-share requirement; the company prefers to regain compliance without a reverse split.