**What is a reverse stock split? Many companies have followed suit within a month.**

Yesterday, Banzai International announced a 1:10 Reverse split (effective July 8th). In simple terms, this means: your 10 shares will be consolidated into 1 share, and the stock price will rise from $0.50 to around $5, while the ownership ratio remains unchanged.

**Why do it this way?**
- Avoid being delisted by Nasdaq (most common reason)
- Looks more "serious", attracting institutional investors
- Reduce the negative perception of stock prices being too low

This is not new. Since the beginning of this year, Comstock Inc. (effective February), Arrowhead Pharmaceuticals, and China Pharma Holdings have all done this. The basic logic is: the company's stock price falls to the floor price → facing delisting risk → Reverse split to boost stock price → temporarily maintain exchange qualification.

**What should investors be wary of?**
Reverse splitting itself doesn't matter; the key is to look at the company's fundamentals. Don't be misled by "the stock price has risen"—if the finances haven't improved, it's just the same old story. There may be short-term fluctuations, but in the long run, we still need to focus on profits.

In simple terms, Reverse split = the company is "playing people for suckers", not that it's necessarily a bad thing, but it is indeed a signal light. 🚨