Mobileye, the self-driving technology company majority owned by Intel, warned on Thursday that it expected that customer orders would drop off dramatically for the first quarter of 2024.
Shares plunged as much as 25% on the news during Thursday morning trading.
“We have become aware of excess inventory at our customers,” Mobileye said in a preliminary full-year outlook.
Automakers stocked up on Mobileye’s chips in the aftermath of global supply chain issues that hampered manufacturing, seeking to avoid future part shortages, the company said.
“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 in its outlook. That means customers will not be placing orders for new chips at the same level as they did in the year-ago quarter.
Intel first announced it would take Mobileye private in 2017 for more than $15 billion, then took the company public again in October 2022.
Intel sold off $1.5 billion worth of its Mobileye stake last year, but retains an 88% stake in the company.
Until recently, Mobileye’s stock traded well above its initial public offering price. The announcement Thursday has trimmed back some of those gains, but IPO buyers still remain up around 12%.
WATCH: Mobileye CEO on China and global growth
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