Cathie Wood's Ark Is Bullish On This Self-Driving Startup Despite Last Week's 32% Plunge

Cathie Wood-led Ark Investment Management said on Saturday it was bullish on self-driving startup TuSimple Holdings Inc TSP despite a management shakeup last week that spooked investors.

What Happened: TuSimple’s shares plummeted 32.6% last week after an unexpected management reshuffle that saw co-founder and CTO Xiaodi Hou taking over the CEO and chairman roles from Cheng Lu. The company said it was part of a "planned executive succession." 

“We have confidence in Xiaodi’s ability to execute on TuSimple’s autonomous strategy,” Wood's firm wrote in an email to provide a weekly update on stocks that fell over 15%. 

San Diego, California-based TuSimple’s stock fell 21% on Thursday, closing at $13 a share, well below its April IPO price of $40. It fell another 13.3% on Friday.

The startup said Lu will remain an adviser to the new CEO until March 2023 to ensure an effective transition.

See Also: TuSimple Reports Receiving 6,775 Orders For Its Self-Driving Electric Truck

Hou is seen as an expert in artificial intelligence and machine learning, and currently holds more than 30 patents related to autonomous vehicles. 

Why It Matters: Wood's Ark Innovation ETF ARKK and Ark Autonomous Technology & Robotics ETF ARKQ held 11 million shares, worth $146.7 million in TuSimple, ahead of Friday’s trade.

Ark Invest counts Tesla Inc TSLA among its largest bets and has also been buying shares in Chinese electric vehicle maker Xpeng Inc XPEV. 

Price Action: TuSimple stock closed 13.3% lower at $11.5 a share on Friday. The stock is down 68.4% YTD.

Photo Courtesy: TuSimple