Fly-E Group, Inc.(FLYE) - 2026 Q1 - Quarterly Results

Fiscal Year 2025 Financial Highlights Fly-E Group, Inc. reported its fiscal year 2025 financial results, highlighting an improved gross margin despite a revenue decline Announcement Fly-E Group, Inc. announced its financial results for the fiscal year ended March 31, 2025, marking a pivotal year with improved gross margin despite a revenue dip - Fly-E Group, Inc. (Nasdaq: FLYE) announced its financial results for the fiscal year ended March 31, 2025[2] CEO's Strategic Overview Mr. Zhou (Andy) Ou, Chairman and CEO, described fiscal year 2025 as pivotal, marked by an improved gross margin of 41.1% due to cost reductions and favorable supplier pricing, particularly for batteries - Gross margin improved to 41.1% in fiscal year 2025, supported by cost reductions and more favorable pricing from suppliers, especially for batteries[4] - The company now offers a broad product portfolio of over 100 models across E-motorcycles, E-bikes, and E-scooters[4] - Rental services are gaining traction in New York City, Toronto, and Los Angeles, with plans to expand to Miami and other markets[4] - Following a successful registered direct public offering in June 2025, the company is well-capitalized to invest in inventory, vehicle production, and working capital[4] - Future strategic focus includes improving product safety, expanding geographic reach, and investing in digital platforms like the Go Fly app[4] Key Financial Summary Fiscal year 2025 saw a 21.0% decrease in net revenues to $25.4 million, leading to a net loss of $5.3 million compared to a net income of $1.9 million in the prior year Key Financial Metrics | Metric | FY2025 (USD) | FY2024 (USD) | Change (%) | | :--------------------- | :----------- | :----------- | :--------- | | Net Revenues | $25.4 million | $32.2 million | -21.0% | | Gross Profit | $10.5 million | $13.1 million | -20.3% | | Gross Margin | 41.1% | 40.7% | +0.4 pp | | Net Income (Loss) | $(5.3) million | $1.9 million | -378.9% | | Basic & Diluted EPS | $(1.10) | $0.43 | -355.8% | Detailed Fiscal Year 2025 Financial Results This section provides an in-depth analysis of Fly-E Group's financial performance for fiscal year 2025, covering revenues, costs, and profitability metrics Net Revenues Net revenues for fiscal year 2025 decreased by 21.0% to $25.4 million, primarily due to a significant 10,846-unit decrease in sales volume, largely driven by reduced retail and wholesale sales Net Revenues and Sales Volume | Metric | FY2025 (USD) | FY2024 (USD) | Change (%) | | :------------- | :----------- | :----------- | :--------- | | Net Revenues | $25.4 million | $32.2 million | -21.0% | | Sales Volume | 58,765 units | 69,611 units | -15.6% | Revenue Breakdown and Drivers Revenue breakdown shows declines in both retail and wholesale sales, partially offset by new rental service revenue Revenue by Type | Revenue Type | FY2025 (USD) | FY2024 (USD) | Change (%) | | :------------------ | :----------- | :----------- | :--------- | | Retail Sales Revenue | $21.7 million | $26.4 million | -17.7% | | Wholesale Revenue | $3.5 million | $5.8 million | -39.3% | | Rental Services Sales | $0.2 million | $0 million | N/A | - Decrease in retail sales revenue was mainly due to recent lithium-battery accidents involving E-Bikes and E-Scooters, leading customers to opt for oil-powered vehicles, and closures/dispositions of retail stores[7] - Decrease in wholesale revenue was primarily driven by the closure of stores by the top two customers in December 2023 due to lack of profitability[7] Cost of Revenues Cost of revenues decreased by 21.6% to $15.0 million, primarily due to more favorable pricing from suppliers, particularly for batteries, and a reduction in sales volume Cost of Revenues and Unit Battery Cost | Metric | FY2025 (USD) | FY2024 (USD) | Change (%) | | :----------------- | :----------- | :----------- | :--------- | | Cost of Revenues | $15.0 million | $19.1 million | -21.6% | | Unit Cost for Battery | $99 | $112 | -11.6% | Gross Profit Gross profit decreased by 20.3% to $10.5 million, aligning with the revenue decline, while gross margin slightly improved to 41.1% from 40.7% Gross Profit and Margin | Metric | FY2025 (USD) | FY2024 (USD) | Change (%) | | :------------- | :----------- | :----------- | :--------- | | Gross Profit | $10.5 million | $13.1 million | -20.3% | | Gross Margin | 41.1% | 40.7% | +0.4 pp | Operating Expenses Total operating expenses increased significantly by 52.5% to $15.0 million, driven by increases in payroll, rent, professional fees, product and software development expenses, and settlement payments Total Operating Expenses | Metric | FY2025 (USD) | FY2024 (USD) | Change (%) | | :----------------- | :----------- | :----------- | :--------- | | Total Operating Expenses | $15.0 million | $9.8 million | +52.5% | Selling Expenses Selling expenses increased by 25.4% to $7.4 million, primarily due to higher payroll and rent expenses, despite a significant decrease in commission expenses Selling Expenses Breakdown | Metric | FY2025 (USD) | FY2024 (USD) | Change (%) | | :----------------- | :----------- | :----------- | :--------- | | Selling Expenses | $7.4 million | $5.9 million | +25.4% | | Payroll Expenses | $3.3 million | $1.6 million | +106.3% | | Rent Expenses | $2.9 million | $2.4 million | +20.8% | | Advertising Expenses | $0.3 million | $0.06 million | +391.7% | | Commission Expenses | $9,980 | $1.1 million | -99.1% | - Increase in payroll expenses was due to more new employees hired in the first three quarters, despite headcount reduction in the last quarter from store closures[10] - Increase in rental expense was due to expansion of retail stores to support business growth[10] - Commission expenses significantly decreased due to discontinuation of marketing referral expenses as of January 1, 2024[10] General and Administrative Expenses General and administrative expenses surged by 94.9% to $7.6 million, driven by increased professional fees, payroll, insurance, software development, and a $1.0 million settlement payment General and Administrative Expenses Breakdown | Metric | FY2025 (USD) | FY2024 (USD) | Change (%) | | :----------------------------------- | :----------- | :----------- | :--------- | | General and Administrative Expenses | $7.6 million | $3.9 million | +94.9% | | Professional Fees | $2.0 million | $1.0 million | +100.0% | | Payroll Expenses | $1.5 million | $1.1 million | +36.4% | | Insurance Expenses | $1.1 million | $0.2 million | +450.0% | | Software Development Fee | $0.5 million | $0.3 million | +66.7% | | Settlement Payments | $1.0 million | N/A | N/A | - Professional fees increased due to audit, consulting, legal, and IR expenses associated with the IPO and ongoing reporting obligations[11] - Insurance expenses rose significantly due to increased general insurance for stores and the purchase of directors and officers liability insurance post-IPO[11] - A $1.0 million settlement payment was made to UL LLC in fiscal year 2025[11] Net Income (Loss) The company reported a net loss of $5.3 million in fiscal year 2025, a significant decline from a net income of $1.9 million in fiscal year 2024, primarily due to decreased revenues and substantially increased operating expenses Net Income (Loss) | Metric | FY2025 (USD) | FY2024 (USD) | Change (USD) | | :-------------- | :----------- | :----------- | :----------- | | Net Income (Loss) | $(5.3) million | $1.9 million | $(7.2) million | Basic and Diluted Earnings (Losses) per Share Reflecting the net loss, basic and diluted losses per share were $1.10 in fiscal year 2025, a reversal from earnings per share of $0.43 in the previous fiscal year Basic and Diluted EPS (LPS) | Metric | FY2025 (USD) | FY2024 (USD) | | :------------------------- | :----------- | :----------- | | Basic and Diluted EPS (LPS) | $(1.10) | $0.43 | EBITDA (Non-GAAP) EBITDA shifted from a positive $3.5 million in fiscal year 2024 to a negative $3.9 million in fiscal year 2025, indicating a significant decline in operational profitability before non-operating items EBITDA | Metric | FY2025 (USD) | FY2024 (USD) | Change (USD) | | :----- | :----------- | :----------- | :----------- | | EBITDA | $(3.9) million | $3.5 million | $(7.4) million | Financial Condition This section details Fly-E Group's financial position, including cash balances and cash flow activities for the fiscal year 2025 Cash and Cash Flows As of March 31, 2025, cash decreased to $0.8 million from $1.4 million, with operating activities consuming $10.1 million, investing activities using $2.9 million, and financing activities providing $12.5 million Cash and Cash Flow Summary | Metric | FY2025 (USD) | FY2024 (USD) | | :----------------------------------- | :----------- | :----------- | | Cash (as of March 31) | $0.8 million | $1.4 million | | Net cash (used in) provided by operating activities | $(10.1) million | $4.3 million | | Net cash used in investing activities | $(2.9) million | $(3.2) million | | Net cash provided by (used in) financing activities | $12.5 million | $(0.05) million | Company Information and Disclosures This section provides essential information about Fly-E Group, including its business, non-GAAP financial measures, forward-looking statements, and investor contacts About Fly-E Group, Inc. Fly-E Group, Inc. is an electric vehicle company focused on designing, installing, selling, and renting smart electric motorcycles, bikes, and scooters under the 'Fly E-Bike' brand - Fly-E Group, Inc. is an electric vehicle company engaged in designing, installing, selling, and renting smart electric motorcycles, electric bikes, and electric scooters under the 'Fly E-Bike' brand[17] - The company's mission is to encourage eco-friendly transportation and contribute to a more environmentally friendly future[17] Non-GAAP Financial Measures The company uses EBITDA as a non-GAAP financial measure to supplement U.S. GAAP results, providing additional insight into operating performance by excluding interest, taxes, depreciation, and amortization - The Company uses EBITDA (earnings before interest, taxes, depreciation, and amortization) as a non-GAAP financial measure[19] - EBITDA provides additional insight into underlying operating performance and facilitates year-to-year comparisons by excluding the earnings impact of interest, tax, depreciation, and amortization[19] - Non-GAAP measures should be viewed in addition to, not as an alternative to, U.S. GAAP measures[18] Definition and Rationale for EBITDA EBITDA is reconciled to net income, the most directly comparable U.S. GAAP measure, and is believed to highlight business trends not apparent from U.S. GAAP alone - EBITDA is reconciled to net income, the most directly comparable U.S. GAAP measure, and includes adjustments for income taxes, interest income/expense, depreciation, and amortization[20] - The company believes EBITDA highlights business trends not apparent from U.S. GAAP alone and eliminates items less bearing on operating performance[20] Forward-Looking Statements The report contains forward-looking statements based on current expectations, which involve known and unknown risks and uncertainties, with actual results potentially differing materially from anticipated outcomes - Forward-looking statements involve known and unknown risks and uncertainties, based on current expectations about future events[21] - Actual results may differ materially from anticipated results, and investors are referred to the 'Risk Factors' section of the company's Form 10-K[21] - The company undertakes no obligation to update or revise publicly any forward-looking statements, except as required by law[21] Investor and Media Inquiries Contact information is provided for investor and media inquiries, including direct company investor relations and an external investor relations firm - Contact information for investor and media inquiries is provided for Fly-E Group, Inc. Investor Relations Department and Ascent Investor Relations LLC[22] Consolidated Financial Statements This section presents Fly-E Group's consolidated financial statements, including balance sheets, statements of operations, cash flows, and EBITDA reconciliation Consolidated Balance Sheets As of March 31, 2025, total assets increased to $33.7 million from $29.0 million, driven by higher current assets and property and equipment, while total liabilities also rose to $23.9 million Consolidated Balance Sheet Summary | Metric (USD) | March 31, 2025 | March 31, 2024 | | :------------------------------- | :------------- | :------------- | | ASSETS | | |\ | Cash | $840,102 | $1,403,514 |\ | Accounts receivable | $466,187 | $212,804 |\ | Inventories, net | $6,397,274 | $5,364,060 |\ | Prepayments and other receivables | $3,676,986 | $588,660 |\ | Assets held for sale | $2,462,502 | — |\ | Total Current Assets | $14,000,516 | $8,136,208 |\ | Property and equipment, net | $7,287,213 | $1,755,022 |\ | Operating lease right-of-use assets | $10,933,068 | $16,000,742 |\ | Total Assets | $33,706,675 | $28,976,334 |\ | LIABILITIES | | |\ | Accounts payable | $1,272,305 | $1,180,796 |\ | Short-term loan payables | $5,191,058 | — |\ | Total Current Liabilities | $12,701,375 | $7,794,816 |\ | Total Liabilities | $23,873,343 | $22,194,512 |\ | STOCKHOLDERS' EQUITY | | |\ | Total Stockholders' Equity | $9,833,332 | $6,781,822 | Consolidated Statements of Operations and Comprehensive (Loss) Income The consolidated statement of operations shows a shift from a net income of $1.9 million in FY2024 to a net loss of $5.3 million in FY2025, driven by decreased revenues and increased operating expenses Consolidated Statements of Operations Summary | Metric (USD) | FY2025 | FY2024 | | :------------------------------- | :------------- | :------------- | | Revenues | $25,427,163 | $32,205,666 |\ | Cost of Revenues | $14,976,266 | $19,099,120 |\ | Gross Profit | $10,450,897 | $13,106,546 |\ | Selling Expenses | $7,403,374 | $5,914,786 |\ | General and Administrative Expenses | $7,607,489 | $3,931,203 |\ | Total Operating Expenses | $15,010,863 | $9,845,989 |\ | Income (Loss) from Operations | $(4,559,966) | $3,260,557 |\ | Net Income (Loss) | $(5,291,159) | $1,895,222 |\ | Earnings (Losses) per Share | $(1.10) | $0.43 | Consolidated Statements of Cash Flows Cash flows from operating activities shifted from a positive $4.3 million in FY2024 to a negative $10.1 million in FY2025, while financing activities provided $12.5 million, primarily from common stock issuance Consolidated Statements of Cash Flows Summary | Metric (USD) | FY2025 | FY2024 | | :----------------------------------------- | :------------- | :------------- | | Net cash (used in) provided by operating activities | $(10,059,466) | $4,308,920 |\ | Net cash used in investing activities | $(2,901,272) | $(3,200,843) |\ | Net cash provided by (used in) financing activities | $12,486,104 | $(49,628) |\ | Cash at beginning of the year | $1,403,514 | $358,894 |\ | Cash at the end of the year | $840,102 | $1,403,514 | - Net proceeds from issuance of common stock (IPO) contributed $9,154,500 to financing activities in FY2025[29] Supplemental Non-Cash Activities The company disclosed several non-cash investing and financing activities, including significant purchases of vehicles and offices funded by loans, and the use of previous prepayments for software and property Supplemental Non-Cash Activities Summary | Non-Cash Activity | FY2025 (USD) | FY2024 (USD) | | :-------------------------------------------------- | :----------- | :----------- | | Purchase of vehicle funded by loan | $224,638 | $34,974 |\ | Purchase of office funded by loan | $1,800,000 | — |\ | Purchase software and office by using previous prepayments | $1,729,000 | — |\ | Right-of-use assets obtained in exchange for operating lease liabilities | $2,490,547 | $10,771,688 | EBITDA Reconciliation The reconciliation shows EBITDA moving from a positive $3.5 million in FY2024 to a negative $3.9 million in FY2025, a 209.9% decrease, driven by the shift from operating income to loss and increased expenses EBITDA Reconciliation Summary | Metric (USD) | FY2025 | FY2024 | Change (USD) | Percentage Change | | :------------------------ | :------------- | :------------- | :------------- | :---------------- | | (Loss) Income from Operations | $(5,291,159) | $1,895,222 | $(7,186,381) | (379.2)% |\ | Income Tax provision | $336,166 | $1,182,933 | $(846,767) | (71.6)% |\ | Depreciation | $631,280 | $272,708 | $358,572 | 131.5% |\ | Interest Expenses | $405,615 | $152,050 | $253,565 | 166.8% |\ | Amortization | $65,091 | $1,648 | $63,443 | 3849.7% |\ | EBITDA | $(3,853,007) | $3,504,561 | $(7,357,568) | (209.9)% |\ | Percentage of Revenue | (15.2)% | 10.9% | | (26.1)% |