10 Worst Augmented Reality (AR) Stocks According to Short Sellers

4. Vuzix Corporation (NASDAQ:VUZI)

Number of Hedge Fund Holders: 11

Short Interest: 13.8%

Vuzix Corporation (NASDAQ:VUZI) is an information technology company that manufactures smart glasses and AR tech. It is based in West Henrietta, New York.

Many investors are avoiding this stock in light of its second-quarter earnings report, which highlighted disappointing results. Company management noted that the $1.1 million revenue for the second quarter was down substantially year-over-year, coupled with an overall gross loss of $0.3 million for the three months ended June 30. The main reason behind such a loss was that Vuzix Corporation (NASDAQ:VUZI) was unable to generate enough revenue to absorb its fixed manufacturing and plant overhead costs.

Manufacturing and overhead costs rose by 42% year-over-year in the second quarter, which is a significant increase from the 8% figure quoted in the second quarter of 2023. Research and development expenses of $2.4 million may also be partially to blame for the loss observed by Vuzix Corporation (NASDAQ:VUZI) in the second quarter. All in all, the company seems to be unable to keep up with its expenses at present, which makes it an incredibly risky stock that should be avoided at present.

In total, 11 hedge funds were long Vuzix Corporation (NASDAQ:VUZI) in the second quarter, with a total stake value of $8.8 million.