Reddit Traders Are Chasing a Squeeze on RR, Not Its Fundamentals

Quick Read

Richtech Robotics (RR) fell 50% after allegedly misrepresenting its Microsoft relationship. Eight law firms filed class action suits.
Retail sentiment jumped on squeeze speculation despite Richtech revenue falling 42% and operating losses hitting $17.9M.
Richtech holds $328.5M in cash but burns $11.8M quarterly in SG&A against just $1.1M in revenue.
Finally! You can open a SoFi Crypto account and access 25 plus cryptocurrencies without juggling apps or logins.

Follow 24/7 Wall St. on Google

By David Beren Published Feb 28, 1:06PM EST

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Reddit Traders Are Chasing a Squeeze on RR, Not Its Fundamentals — © Alexander Supertramp / Shutterstock.com

Richtech Robotics (NASDAQ:RR), a company that specializes in developing, manufacturing, and deploying robotic solutions for automation, is currently trading at $2.74, down 28% over the past month after a January scandal exposed what multiple law firms allege was a misrepresentation of the company’s relationship with Microsoft. Retail sentiment on Reddit has climbed from a quarterly average of 77.6 to 84.8 in the past week, a split that captures the central tension: does the post-crash price reflect a genuine reassessment of fundamentals, or does the stock reflect a business that was always more narrative than substance?

On January 29, 2026, Hunterbrook Media alleged Richtech mischaracterized what Microsoft called a “standard, non-commercial customer program” as a close commercial collaboration. Shares fell by more than 29% over two days on the news, and at least eight law firms have since filed class-action suits, with a lead plaintiff deadline of April 3, 2026.

Retail Traders Are Betting on a Squeeze, Not the Business

Discussion is concentrated in r/options, driven by a thread about a trader who purchased 11,470 $3 call options expiring Friday, which has accumulated 50 upvotes and 57 comments over 48 hours. The original post read: “11470 $3 calls expiring this Friday bought today on $RR Richtech Robotics.”

An infographic titled 'RICHTECH ROBOTICS (RR) SNAPSHOT' on a blue and dark gray background. The top section, 'INVESTMENT FOCUS', shows a robotic arm and gear icon, with text stating 'ROBOTICS & AUTOMATION SOLUTIONS', 'Nasdaq: RR', and 'Sector: Robotics'. The middle section, 'CURRENT SOCIAL SENTIMENT SCORE', features a large green circle with '84.8' inside, an upward green arrow, and the text 'VERY BULLISH (Week/Month Avg)'. Below this, the trend is described as 'Notable upward shift from 77.6 (Quarter Avg)'. The bottom section, 'PRIMARY SCORE DRIVER: OPTIONS SQUEEZE SPECULATION', has an icon of a magnifying glass over a bar chart labeled 'CALLS'. Bullet points explain the driver: 'Driven by r/options activity', 'Focus on 11,470 $3 call options expiring Friday', and 'Key Post: “11470 $3 calls expiring this Friday bought today on $RR Richtech Robotics”'. The source '24/7 Wall St. Data, Friday, Feb 27, 2026' is at the bottom right. — This infographic details Richtech Robotics’ (RR) current social sentiment, which is rated ‘Very Bullish’ at 84.8, primarily driven by options squeeze speculation around 11,470 call options expiring today, February 27, 2026.

11470 $3 calls expiring this Friday bought today on $RR Richtech Robotics
by u/[OP] in r/options

One commenter framed the bull case: “Richtech currently has approximately $330M in cash, virtually no debt, and a market capitalization near $612M, with short interest exceeding 25%.” That is a short-squeeze setup, not a fundamental thesis.

Revenue has fallen 42% from its FY2023 peak of $8.76M to $5.05M in FY2025, while SG&A tripled to $17.5M, producing an operating loss of $17.9M.
The three-pillar model (hardware, RaaS, data services) generates only $0.3M in RaaS revenue per quarter, with no disclosed figures for data services.
Short interest sits at 25.28% of float, roughly 4.6 times the peer group average of 5.43%.

Strong Balance Sheet, Unsustainable Burn

Looking at the numbers as the company moves deeper into 2026, Richtech closed Q1 FY2026 with $328.5M in liquid assets and just $730,000 in total debt. The problem is that the cash funds: Q1 FY2026 SG&A alone hit $11.8M against $1.1M in revenue. HC Wainwright maintains a Buy rating with a $6 price target, implying over 100% upside, but that call predates the Microsoft dispute. The April 3 lead plaintiff deadline is the next meaningful catalyst, as consolidated litigation could pressure the stock regardless of the business trajectory.