Flux Power reports fiscal year 2025 first and second quarter financial results

Flux Power Holdings, Inc. (NASDAQ: FLUX), a developer of advanced lithium-ion energy storage solutions for electrification of commercial and industrial equipment, has reported its financial and operational results for the first fiscal quarter ended September 30, 2024, and the second fiscal quarter ended December 31, 2024.

Key Financial and Operational Highlights and Business Updates

($ millions)	Q1 Comparison					Q2 Comparison
	Q1 2025	Q1 2024 (Restated)	$ Change YoY	% Change YoY		Q2 2025	Q2 2024 (Restated)	$ Change QoQ	% Change QoQ
Revenue	$16.1	$14.8	$1.3	9%		$16.8	$18.2	($1.4)	(8%)
Gross Profit	$5.2	$4.2	$1.0	23%		$5.5	$5.4	$0.1	2%
Gross Margin	32%	29%	$ -	370BPS		33%	30%	$ -	290BPS
Adjusted EBITDA	($0.6)	($1.2)	$0.6	51%		($1.0)	$0.2	($1.2)	(555%)

CEO Commentary

“The first half of FY 2025 was highlighted by sequential revenue and gross margin growth, driven by enhanced sales strategies, better market conditions and growing demand for our innovative suite of products,” said Krishna Vanka, Flux Power’s CEO. “Although we have experienced some recent lumpiness in orders, we expect our momentum to continue as indications reflect potential increasing order flow for the coming quarters. Even more, we maintain a positive long-term outlook, supported by an open order backlog of $19.5 million as of February 28, 2025.

“Gross margins have steadily improved over the last several quarters, increasing from 27% in Q4 FY 2024, to 32% in Q1 FY 2025, and 33% in Q2 FY 2025. Cost reductions and price increases have contributed to this gross margin growth, combined with a focus on strategic supply chain and profitability improvement initiatives, lower costs and higher volume purchasing.”

Key 1H 2025 Takeaways:

• Certain delays of customer orders stretched beyond the second quarter ending December 31, 2024
• Delays linked to forklift deferrals as a result of higher interest rates
• No known lost customers nor lost orders to competition
• Underlying demand remains strong due to continued Lithium adoption by customers
• Actions supporting targeted sales trajectory
• Launched new Private Label program for a second top 10 Forklift original equipment manufacturer (OEM), as highlighted below
• New product launches of heavy-duty models addressing customer demand
• Adding salespeople to support customer demand and expanded coverage
• Increasing marketing resources and initiatives
• Actions supporting increased gross margins
• Focus on supply chain management and reduced component costs through increased supplier competition
• Select pricing increases reflecting our “total value add” to products/customers
• Continued progress to expand technology, innovation, and partnerships
• Telemetry features offered for customer asset management, including recurring revenue
• New partnership aimed at enhancing the recycling process for end-of-life lithium-ion batteries with the largest critical battery components recycling company in the U.S.
• Development of machine learning and AI features for product support of large fleets
• Automation of modularizing battery cells to launch this summer
• Key management changes:
• As part of our long-term succession plan, Krishna Vanka replaced Ron Dutt, whose retirement was previously announced, as CEO. Mr. Vanka most recently held the position as CEO of Fluence Digital, a part of Fluence Energy, a global market leader in energy storage. At Fluence Digital, he was responsible for scalable growth, full P&L, general management, strategic leadership and operational excellence of the company’s recurring revenue businesses, including all of its BESS (battery energy storage solutions) and professional services.
• Kelly Frey appointed Chief Revenue Officer, bringing over 20 years of notable experience as a sales and marketing leader, including strategic roles at organizations ranging from startups to Fortune 100 companies.
• Other developments:
• Announced a strategic partnership with one of the top forklift OEMs to launch a new private label battery program. This collaboration marks a significant milestone for Flux Power’s S-Series line, which now includes products with the coveted UL Type EE certification, which provides added safety and durability capability.

CEO Commentary Continued:

“We have built a strong foundation, and have the strategy in place, to support revenue growth to fuel our path to profitability. Fortune 500 companies and other large fleets are increasingly looking to electrify with lower cost and higher performance lithium-ion battery packs that also support sustainability – and Flux is ideally positioned to meet their needs. With these market drivers, combined with stabilizing interest rates and the end of election uncertainty, we anticipate year-over-year revenue growth in fiscal year 2025.

“Additional initiatives to support growth include expanding our product lines for multiple customer segments, adjacent markets and filling gaps in energy storage offerings. In the coming months we also plan additional heavy duty models to fill a product line gap. We remain excited about our telemetry product, which includes asset management features that offer true value creation to our fleet customers. We continue to focus on meeting the evolving demands of our customers with new and innovative solutions as well as by enhancing our current products and capabilities, with nearly $2.3 million in first half FY 2025 revenue coming from six new customers.

“To further emphasize our commitment to innovation and excellence in the material handling industry, we recently partnered with one of the top forklift OEMs to launch a new private label battery program. We also partnered with the largest critical battery components recycling company in the U.S. to enhance the recycling process for end-of-life lithium-ion batteries. Through this collaboration, our recycling partner has commenced recycling these cells and modules, marking a major milestone in our sustainability efforts. We will continue to identify and build partnerships like these, demonstrating flexibility and creativity to enhance customer relationships and drive sustainability.

“We also made two important additions to our team with the appointment of Kelly Frey as Chief Revenue Officer and Mark Barmettler as our new Senior Head of Engineering. Kelly brings over 20 years of experience as a sales and marketing leader, including roles ranging from startups to Fortune 100 companies. Kelly is focused on elevating our revenue generation, expanding relationship sales, expanding our market reach, and improving customer retention, playing a key leadership role in maximizing revenue potential and sustaining long-term growth. Mark brings over 10 years in engineering leadership roles covering telecommunications and test equipment incorporating firmware, software, and cloud solutions. Mark will be addressing new product innovation, cost reductions, and telemetry.

“Taken together, we believe we are well positioned to achieve sustainable positive cash flow this calendar year with a focused strategy and innovative product set. We look forward to providing further updates in the months to come as we return to a regular cadence of financial and operational reporting for our shareholders,” Vanka concluded.

Quarterly Orders and Shipments:

The backlog status is a point in time measure but in total reflects the underlying pacing of orders:

Fiscal Quarter Ended			Beginning Backlog			New Orders			Shipments			Ending Backlog
September 30, 2023		$	28,393,000		$	8,102,000		$	14,787,000		$	21,708,000
December 31, 2023		$	21,708,000		$	26,552,000		$	18,203,000		$	30,057,000
March 31, 2024		$	30,057,000		$	4,030,000		$	14,457,000		$	19,630,000
June 30, 2024		$	19,630,000		$	11,614,000		$	13,377,000		$	17,867,000
September 30, 2024		$	17,867,000		$	19,451,000		$	16,125,000		$	21,193,000
December 31, 2024		$	21,193,000		$	13,116,000		$	16,830,000		$	17,479,000

As of February 28, 2025, order backlog was approximately $19.5 million.

Q1’25 Financial Results

Revenue for the fiscal first quarter of 2025 was $16.1 million, an increase of 9% compared to $14.8 million in the fiscal first quarter of 2024, primarily driven by an increase in shipments into the Ground Support Equipment market at higher average selling prices compared to the same period in the prior year. This was partially offset by a reduction in shipments to the Material Handling market. Revenue in the immediately preceding fiscal Q4 2024 was $13.4 million.

Gross Profit for the first fiscal quarter of 2025 increased 23% to $5.2 million compared to gross profit of $4.2 million in the fiscal first quarter of 2024. Gross margin increased to 32% in the fiscal first quarter of 2025 as compared to 29% in the fiscal first quarter of 2024. Gross profit margin increased by 370 basis points driven by an increase in average selling prices partially offset by an increase in warranty costs.

Adjusted EBITDA was a loss of $0.6 million in the fiscal first quarter of 2025 as compared to a loss of $1.2 million in the fiscal first quarter of 2024.

Selling & Administrative expenses increased to $5.1 million in the fiscal first quarter of 2025 as compared to $4.7 million in fiscal first quarter of 2024, primarily attributable to stock-based compensation and professional services associated with the restatement of previously issued financial statements.

Research & Development expenses were flat at $1.3 million in both first fiscal quarters of 2025 and 2024.

Net Loss for the first fiscal quarter of 2025 was $1.7 million, compared to a loss of $2.2 million in the first fiscal quarter of 2024, primarily attributable to increased gross profit, which was partially offset by increases in operating expenses and interest expense.

Q2’25 Financial Results

Revenue for the second fiscal quarter of 2025 decreased 8% to $16.8 million compared to $18.2 million in the second fiscal quarter of 2024, driven by lower demand in the material handling market and lower average selling prices due to product mix.

Gross Profit for the second fiscal quarter of 2025 increased 2% to $5.5 million compared to a gross profit of $5.4 million in the second fiscal quarter of 2024. Gross margin increased to 33% in the second fiscal quarter of 2025 as compared to 30% in the second fiscal quarter of 2024. Gross profit margin increased by 290 basis points as a result of a decrease in average costs partially offset by an increase in warranty costs.

Adjusted EBITDA was a loss of $1.0 million in the fiscal second quarter of 2025 as compared to a gain of $0.2 million in the fiscal second quarter of 2024.

Selling & Administrative expenses increased to $6.0 million in the second fiscal quarter of 2025 as compared to $4.6 million in second fiscal quarter of 2024, primarily attributable to variable incentive compensation, severance, and professional fees associated with the multi-year restatement of previously filed financial statements.

Research & Development expenses decreased to $1.0 million in the second fiscal quarter of 2025 compared to $1.2 million in the second fiscal quarter of 2024, mainly driven by lower salaries and stock based compensation.

Net Loss for the second fiscal quarter of 2025 was $1.9 million, compared to a loss of $0.9 million in the second fiscal quarter of 2024, primarily attributable to an increase in operating expenses.

Cash was $0.9 million on December 31, 2024, as compared to $0.6 million at June 30, 2024, reflecting changes in working capital management. Available working capital includes: our line of credit as of December 31, 2024, under our $16.0 million credit facility from Gibraltar Business Capital (“Gibraltar”), with a remaining available balance of $6.3 million subject to borrowing base limitations and satisfaction of certain financial covenants; and $1.0 million available under the subordinated line of credit with Cleveland Capital. Our credit line with Gibraltar, subject to eligible accounts receivables and inventory borrowing base, provides for expansion up to $20 million.

First & Second Quarter Fiscal Year 2025 Results Conference Call

Flux Power CEO Krishna Vanka, Senior Advisor and former CEO Ron Dutt, and CFO Kevin Royal will host a conference call, followed by a question-and-answer session. The conference call will be accompanied by a presentation, which can be viewed during the webcast or accessed via the investor relations section of the Company’s website here.

To access the call, please use the following information:

Date:	March 20, 2025
Time:	4:30 p.m. Eastern Time, 1:30 p.m. Pacific Time
Toll-free dial-in number:	1-877-407-4018
International dial-in number:	1-201-689-8471
Conference ID:	13751845

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact MZ Group at 1-949-491-8235.

The conference call will be broadcast live and available for replay at https://viavid.webcasts.com/starthere.jsp?ei=1708568&tp_key=02a5eca95eand via the investor relations section of the Company's website here.

A replay of the webcast will be available after 7:30 p.m. Eastern Time through June 20, 2025.

Toll-free replay number:	1-844-512-2921
International replay number:	1-412-317-6671
Replay ID:	13751845

Note about Non-GAAP Financial Measures

A non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with accounting principles generally accepted in the United States of America, or GAAP. Non-GAAP measures are not in accordance with, nor are they a substitute for, GAAP measures. Other companies may use different non-GAAP measures and presentation of results.

In addition to financial results presented in accordance with GAAP, this press release presents adjusted EBITDA, which is a non-GAAP measure. Adjusted EBITDA is determined by taking net loss and adding interest, taxes, depreciation, amortization, and stock-based compensation expenses. The company believes that this non-GAAP measure, viewed in addition to and not in lieu of net loss, provides additional information to investors by providing a more focused measure of operating results. This metric is an integral part of the Company’s internal reporting to evaluate its operations and the performance of senior management. A reconciliation of adjusted EBITDA to net loss, the most comparable GAAP measure, is available in the accompanying financial tables below. The non-GAAP measure presented herein may not be comparable to similarly titled measures presented by other companies.

US-GAAP NET INCOME (LOSS) TO ADJUSTED EBITDA RECONCILIATION
(Unaudited)

	Three months ended September 30,
		2024			2023
Net loss	$	(1,669,000)		$	(2,188,000)
Add/Subtract:
Interest, net		457,000			403,000
Income tax provision		-			-
Depreciation and amortization		252,000			261,000
EBITDA		(960,000)			(1,524,000)
Add/Subtract:
Stock-based compensation		347,000			276,000
Adjusted EBITDA	$	(613,000)		$	(1,248,000)

US-GAAP NET INCOME (LOSS) TO ADJUSTED EBITDA RECONCILIATION
(Unaudited)

	Three months ended December 31,						Six months ended December 31,
		2024			2023			2024			2023
Net loss	$	(1,887,000)		$	(896,000)		$	(3,556,000)		$	(3,084,000)
Add/Subtract:
Interest, net		408,000			449,000			865,000			852,000
Income tax provision		-			-			-			-
Depreciation and amortization		250,000			262,000			502,000			523,000
EBITDA		(1,229,000)			(185,000)			(2,189,000)			(1,709,000)
Add/Subtract:
Stock-based compensation		278,000			394,000			625,000			670,000
Adjusted EBITDA	$	(951,000)		$	209,000		$	(1,564,000)		$	(1,039,000)