FaZe Clan In Danger Of Being Delisted From Wall Street
Despite its success over the years, FaZe Clan does have a few tragic details in its past, and it appears that it may be about to add another chapter to the darker side of its legacy. While FaZe has existed as a company since 2010, it made the decision to go public — offering stock and becoming listed on the Nasdaq (a major stock exchange based in New York) — last summer. In less than a year, however, their stock price has fallen dramatically and, as a result, FaZe is facing being delisted. This could have serious repercussions for the company and its chances of remaining public.
While FaZe Clan debuted on Wall Street at a share price of just over $13 and briefly climbed to $19, it began plummeting shortly after. By the beginning of 2023, it had fallen under a dollar, which triggered a reaction from the Nasdaq.
The Nasdaq, like all stock exchanges, sets standards that companies must meet in order to be listed and traded on the exchange. If a company is struggling and sees its stock price fall under a dollar for an extended period of time, the Nasdaq may instruct the company to get its financial house in order and raise its share price or face being removed from the exchange altogether. This is what FaZe Clan is now confronted with.
Delisting could hurt FaZe or lead to a return to private owernership
FaZe Clan recently received its "Notice of Delisting" from the Nasdaq, which gives the company 180 days to raise its stock price over a dollar and keep it that way for — at a minimum — ten days in a row. If FaZe fails to meet this requirement, it will be removed from the Nasdaq, meaning investors will be unable to buy or sell the stock on that exchange.
Delisting is a serious move and can harm any publicly traded company. No longer being listed on a major exchange means it becomes harder for investors to see news about the company and to trade in its stock. This could reduce interest in FaZe and further drive down its stock price in the future.
FaZe Clan does not appear to have offered any details about what it intends to do to rectify this issue just yet. However, Sports Business Journal reported on sources claiming that the company was looking to raise the money to go private again. This would involve buying back all private shares and voluntarily removing itself from the Nasdaq. If true, the "Notice of Delisting" may accelerate these plans, as FaZe seeks to save itself the shame of being kicked out by leaving on its own. Whatever Faze is planning, the 180-day time limit means decisions should be happening quickly in the coming months. Fans may see FaZe getting back to focusing on turning heads with new shows and leaving the stock market to the professionals.