Dragonfly Energy(DFLI) - 2025 Q3 - Quarterly Results

Preliminary Third Quarter 2025 Financial Results Preliminary Q3 2025 financial results exceeded guidance for Net Sales and Adjusted EBITDA, with a cautionary note on data finalization Highlights of Preliminary Results Preliminary Q3 2025 Net Sales and Adjusted EBITDA exceeded guidance, with strong year-over-year growth and reduced loss Preliminary Q3 2025 Financial Highlights | Metric | Preliminary Q3 2025 | Guidance | YoY Growth/Change | | :-------------------- | :------------------ | :--------- | :------------------ | | Net Sales | $16.0 million | $15.9 million | 26% Growth | | Adjusted EBITDA | $(2.2) million | $(2.7) million | $3.3 million reduction in loss | CEO Commentary on Performance CEO highlighted preliminary results exceeding guidance, attributing continued Net Sales growth and Adjusted EBITDA improvement to strategic actions - Preliminary Q3 Net Sales and Adjusted EBITDA exceeded guidance, showing continued year-over-year Net Sales growth and Adjusted EBITDA improvement[3] - Results underscore a focus on driving near-term revenue growth and executing strategic actions, such as a recent equity raise, to enhance financial flexibility and potential for sustained net sales growth and profitability[3] Cautionary Note on Preliminary Data The reported Q3 2025 financial data is preliminary and subject to finalization and potential material adjustments during Form 10-Q preparation - Preliminary Q3 2025 Net Sales and Adjusted EBITDA are subject to finalization and adjustment during the preparation of the Company's Quarterly Report on Form 10-Q[4] - Investors should exercise caution in relying on this preliminary information, as material adjustments may be identified[4] Company Overview and Investor Information This section provides an overview of Dragonfly Energy's business and details for its third quarter 2025 webcast About Dragonfly Energy Dragonfly Energy is a leading lithium battery technology company specializing in cell manufacturing, battery pack assembly, and full system integration - Dragonfly Energy is a comprehensive lithium battery technology company specializing in cell manufacturing, battery pack assembly, and full system integration[7] - The company's Battle Born Batteries® brand is a frontrunner in the lithium battery industry, with hundreds of thousands of reliable battery packs deployed[7] - Dragonfly Energy's mission is the future deployment of its proprietary, nonflammable, all-solid-state battery cells, utilizing a patented dry electrode manufacturing process[7] Third Quarter 2025 Webcast Details Dragonfly Energy will host a conference call on November 14, 2025, to discuss its Q3 2025 financial and operational results - A conference call to discuss Q3 2025 financial and operational results will be held on Friday, November 14, 2025, at 4:30 PM Eastern Time[5] - The call can be accessed live via webcast or telephone, with specific dial-in numbers and a conference ID provided[5] - An archive of the webcast will be available shortly after the call on the Investor Relations section of Dragonfly Energy's website[6] Disclosures and Non-GAAP Measures This section outlines forward-looking statements and the use of non-GAAP financial measures, including their definitions, rationale, limitations, and reconciliation Forward-Looking Statements This press release contains forward-looking statements subject to various risks and uncertainties that could cause actual results to differ materially - The press release includes forward-looking statements concerning future results, operations, and financial position, subject to risks and uncertainties[9] - Factors such as market recovery, ability to penetrate new markets, supply chain, intellectual property, and competition could cause actual results to differ materially[10] - The Company undertakes no obligation to update these statements to reflect events or circumstances occurring after their original date, except as required by law[11] Use of Non-GAAP Financial Measures Dragonfly Energy uses non-GAAP financial measures like EBITDA and Adjusted EBITDA to supplement GAAP information and enhance understanding of financial performance - Non-GAAP financial measures like EBITDA and Adjusted EBITDA are provided to supplement GAAP information and enhance understanding of financial performance[12] - These non-GAAP measures should be considered as a supplement to, not a substitute for, financial information prepared on a GAAP basis[12] Definition and Rationale for Adjusted EBITDA Adjusted EBITDA is a non-GAAP measure used by management to evaluate operating performance by excluding specific non-cash and non-recurring items - Adjusted EBITDA is a non-GAAP measure calculated by adjusting EBITDA to exclude stock-based compensation expense and changes in fair market value of warrant liabilities[13] - It is a key measure used by management to evaluate operating performance, generate future operating plans, and make strategic decisions, highlighting trends in core operating results[14] Limitations of Adjusted EBITDA Adjusted EBITDA has analytical limitations as it does not reflect cash expenditures, tax expenses, or cash requirements for asset replacements - Adjusted EBITDA does not reflect cash expenditures, future capital expenditure requirements, contractual commitments, or changes in working capital needs[16] - It does not reflect tax expense or cash requirements to pay taxes, nor does it account for cash requirements for asset replacements despite depreciation and amortization being non-cash charges[16] - The usefulness of Adjusted EBITDA as a comparative measure is limited because other companies in the industry may calculate it differently[16] Reconciliation of GAAP to Non-GAAP Measures A reconciliation table details the calculation of EBITDA and Adjusted EBITDA from Net (Loss) Income Before Taxes for Q3 2025 and Q3 2024 Reconciliation of GAAP to Non-GAAP Measures (Unaudited) (U.S. Dollars in Thousands) | | Three Months Ended | | | :---------------------------------- | :------------------ | :------------------ | | | Sep 30, 2025 | Sep 30, 2024 | | EBITDA Calculation | | | | Net (Loss) Income Before Taxes | $(11,089) | $(6,779) | | Interest Expense | 6,409 | 5,615 | | Depreciation and Amortization | 502 | 327 | | EBITDA | $(4,178) | $(837) | | Adjustments to EBITDA | | | | Stock - Based Compensation | 168 | 256 | | Separation Agreement Expense | 35 | - | | Lease Impairment | 555 | - | | Preferred Stock Financing expenses | 13 | - | | Debt Restructure Expense | 354 | - | | Change in fair market value of warrant liability | 883 | (4,875) | | Adjusted EBITDA | $(2,170) | $(5,456) |