Dragonfly Energy(DFLI)2025-05-15 21:30Financial Data and Key Metrics Changes - The company reported a revenue growth of 6.8% in Q1 2025, marking the second consecutive quarter of year-over-year revenue growth [5][18] - First quarter net sales reached $13.4 million, with OEM net sales increasing by 10.8% to $8.1 million, while DTC segment revenue declined by approximately 3.6% to $5 million [18] - Gross profit increased by 12.5% to $3.9 million, and gross margin improved by 500 basis points to 29.4% [19] - The net loss for the quarter was $6.8 million, with a diluted loss per share of $0.93, compared to a net loss of $10.4 million and a diluted loss per share of $1.55 in the prior year [19] - Adjusted EBITDA improved to a loss of $3.6 million from a loss of $5.2 million year-over-year [19] Business Line Data and Key Metrics Changes - The OEM channel showed strong growth with a 10.8% increase in net sales, driven by broader integration of solutions at the factory level [5][18] - The DTC segment faced challenges, reflecting macroeconomic pressures that led to a decline in net sales [5][18] Market Data and Key Metrics Changes - The company highlighted its competitive advantage due to growing US-based production capabilities, which are crucial amid the volatile tariff landscape [9][10] - The strategic position is further enhanced by a lithium supply agreement with Pioneer, which supports the localization of the critical mineral supply chain [11] Company Strategy and Development Direction - The company is focusing on long-term growth through the OEM channel while optimizing its operations for near-term revenue generation [6][18] - A corporate optimization program has been launched to enhance operational efficiency and prioritize product development with immediate revenue potential [6][7] - The company aims to transition select components to North American sourcing and expand its domestic footprint as market conditions evolve [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating ongoing market volatility while delivering high-quality energy storage solutions [19] - The company anticipates net sales of approximately $14.8 million in Q2 2025, representing a year-over-year growth of 12% [19] - Management emphasized the importance of returning to cash flow positive status to support future developments, including dry electrode and solid-state technologies [30] Other Important Information - The company has implemented several targeted enhancements across manufacturing operations, resulting in increased production capacity without additional headcount [7] - The focus on domestic manufacturing allows the company to better absorb tariff-related impacts and maintain quality control [10][12] Q&A Session Summary Question: Updates on dry electrode manufacturing technology commercialization opportunities - Management confirmed ongoing development and interest from commercial partners, but emphasized a focus on near-term revenue and profitability [25][26] Question: Thoughts on cash balance and EBITDA guidance - Management indicated that the recent preferred equity deal has strengthened the cash position, allowing for a focus on near-term revenue growth [28][29] - The expected EBITDA loss in Q2 is attributed to continued investments in product development and the impact of tariffs [31][32]