Shares of Rada Electronic Industries Ltd. tumbled 12.7% toward an 18-month low in premarket trading Wednesday, after the Israel-based defense technology company warned of a revenue shortfall. The company said it now expects second-quarter revenue of about $22.5 million, or about the same as the first quarter but down from $28.3 million a year ago. The outlook is well below the FactSet consensus of $36.1 million. “It is taking longer for RADA to recover from the U.S. Continuing Resolution (CR) pause with orders coming slower than originally planned for and revenues from the U.S. similarly impacted,” said Rada Chief Executive Dov Sella. The company said it was withdrawing its full-year financial outlook, given its pending merger with U.S.-based defense contractor Leonardo DRS. Rada shares, which are on track to open at the lowest price seen during regular-session hours since Dec. 3, 2020, have tumbled 35.4% over the past three months through Tuesday, while the S&P 500 declined 14.5%.
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