Short Seller Targets Gorilla Technology Group Stock, Investors Take Profits

Gorilla Technology Group Inc GRRR shares are tanking Thursday after The Bear Cave released a short report on the company. Here’s what investors need to know.

What To Know: Short seller The Bear Cave released a bearish report on Gorilla Technology Thursday morning in response to the stock’s approximately 1,200% rise over the past six months, driven by retail investor enthusiasm surrounding recent partnership announcements.

“The Bear Cave believes recent retail investor enthusiasm for the company may be premature,” the short seller said.

The Bear Cave pointed out several red flags at Gorilla Technology including the company’s aggressive pivot to AI technology, its revenue streams, unconventional partnerships and controls over financial reporting.

Benzinga has reached out to Gorilla Technology Group for comment on The Bear Cave report.

The Bear Cave noted that Gorilla Technology was founded in 2001 as a video analytics company. The company recently pivoted its focus to AI technology under current chairman and CEO Jay Chandan, who also led the special purpose acquisition company (SPAC) that brought Gorilla public in 2022.

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The short seller highlighted a myriad of trendy technologies that Gorilla says it focuses on including smart cities, blockchain technology, AI and the Internet of Things. The Bear Cave also noted that in the company’s most recent annual report, it disclosed that approximately 94% of revenue came from two customers: the Government of Egypt and the Criminal Investigation Bureau of Taiwan.

Despite the underwhelming financials, retail investors have bid up the stock on the back of a series of optimistic announcements including a deal with ONE Amazon to power the “Internet of Forests” in the Amazon Rainforest.

The Bear Cave also raised questions around the company’s financial reporting, noting that the company’s former CFO resigned with “no apparent notice” in September 2024 and was replaced by a CFO who appears to have limited experience.

“Even for the most trusting investor, some of Gorilla’s statements seem to be a stretch,” the short seller said.

Gorilla Technology’s longtime auditor was also dismissed last year after the company disclosed material weaknesses in its internal control over financial reporting. The company engaged an auditor from Marcum Asia who has served as an audit engagement partner for several other companies, all of which have performed poorly in public markets, according to The Bear Cave.

GRRR Price Action: Gorilla Technology shares were down 22.5% at $32.24 at the time of publication Thursday, according to Benzinga Pro.

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This illustration was generated using artificial intelligence via Midjourney.