Zymergen Shares Sink After Company Loses CEO and Says This

Synthetic biology company Zymergen saw its shares plummet nearly 70% on Tuesday after the company said that product revenue would be “immaterial” in 2022 and that its Chief Executive was stepping down.

The company, which went public at $31 a share in April, traded as high as $48.50, valuing the company at $4.8 billion.

On Tuesday shares hit as low as $11.07 in after-hours trading, leaving the market cap at just over $1 billion.

Zymergen has warned investors that revenue from its experimental products won’t be coming anytime soon.

The company, described as a “biofacturing company using biology to reimagine the world,” said in a press release that it no longer expects to generate product revenue in 2021 and that revenue next year will be “immaterial.”

The company additionally said that Josh Hoffman, who co-founded Zymergen in 2013, is stepping down as CEO and will be replaced on an acting basis by Jay Flatley, former CEO of Illumina.

“We are disappointed by these developments, and the board and management team are focused on resolving the underlying issues to ensure Zymergen moves forward as a stronger company with a compelling operating plan,” Flatley said, in the press release.

“We are confident in Zymergen’s opportunities and prospects, although it will take longer to accomplish our goals than previously expected.”

In the company’s IPO prospectus, Zymergen said it expected to start generating revenue from Hyaline in the second half of 2021 from Hyaline.

Zymergen launched Hyaline, an optical film, created using a biomolecule, that electronics companies can use for things like touch screens, in 2020. Zymergen’s goal is to have a product that’s environmentally sustainable at significantly lower costs than what’s produced by traditional chemical companies.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.