Minim baffled on why its shares shot through the stratosphere

Shares in Minim, a troubled company that makes cable modems under the Motorola brand, inexplicably rose more than 700% during trading on Wednesday, finally closing at $4.48 each (+$3.55), up 368% for the day.

Such a surge in the stock price might suggest that some sort of transaction or resolution on the company's assets is imminent. However, Minim, a Massachusetts-based company that has slashed its workforce and shut down its website in recent weeks, said it was baffled at why its stock suddenly went through the roof.

"Normally, the Company does not comment on market activity or rumors," Minim said Thursday in a statement. "However, Minim is not aware of any material, undisclosed information related to the Company that would account for the recent increase in the market price and increase in the level of trading volume of its shares."

However, the stock price surge does enter the picture as Minim faces a potential delisting on the Nasdaq market. On Thursday, the same day that Minim's stock exploded, the company disclosed in a Securities and Exchange filing that the Nasdaq had granted the company a grace period of 180 calendar days, or until May 28, 2024, to regain compliance with the minimum closing bid price requirement to remain listed on the Nasdaq. To regain compliance, Minim common shares must meet or exceed $1 per share for at least ten consecutive days during the grace period.

Related:Minim, a maker of Motorola-branded cable modems, is in trouble

Time will tell if Minim can stay compliant for that length of time. Shares in the company were heading back to Earth in after-hours trading Thursday, down 16%, to $3.73 each at last check.

Adding to the chaos

Minim's sporadic stock price comes along at an already chaotic time at the company.

Amid shifts in leadership roles, including at the CEO and CFO levels, in recent months, the company slashed about 78% of its staff in September as it faced a cash crunch. Fewer than a handful of employees remain at Minim, a person familiar with the matter tells Light Reading.

Minim, whose website remains down and in the hands of GoDaddy, has also warned of "substantial doubt" that the company can remain a going concern without an influx of more capital.

Minim has been asked for an update on the number of full-time workers remaining at the company and for an explanation of the current state of its website.

Minim is one of a select number of companies that make DOCSIS modems and gateways for retail sale, competing in that arena with CommScope, Hitron and Netgear.

Earlier this month, Minim informed the SEC that the company would miss an extended deadline to file its Q3 2023 financial results "without unreasonable effort or expense." The company has tapped BF Borgers, an independent accounting firm, to handle the company's fiscal year ended December 31, 2023.

As of June 30, 2023, Minim reported having cash and cash equivalents of $300,000, $2.4 million of outstanding borrowings on its asset-based credit line and an accumulated deficit of $84.5 million.

Minim uplisted to the Nasdaq more than two years ago.

Minim entered the cable modem game in 2020 via a merger with Zoom Telephonics, which first obtained the Motorola license in 2015. In addition to selling DOCSIS modems, gateways, and other types of consumer premises equipment (CPE), Minim embarked on a strategy to develop a recurring revenue stream by licensing a home network management platform designed to compete with companies such as Plume.

A person familiar with the company said Lenovo/Motorola has been in talks with a number of companies to sell access to the Motorola license.

Editor's note: The story was corrected to note that Motorola, not Minim, has been in talks with multiple companies about licensing its brand.