TLDR
- Dragonfly Energy stock jumps 4.85% after positive Q3 results and strong OEM sales.
- Q3 OEM sales soar 44%, driving Dragonfly’s 25.5% net sales growth.
- Dragonfly Energy’s debt restructuring boosts financial flexibility and growth.
- Despite losses, Dragonfly Energy shows improved margins and operational efficiency
- Dragonfly Energy projects 7% growth in Q4 net sales, positioning for long-term success.
Dragonfly Energy Holdings Corp. (DFLI) saw a surge in stock value, closing at $0.8103, marking a 4.85% increase.
Dragonfly Energy Holdings Corp., DFLI
This positive performance follows the company’s third-quarter results, which exceeded projections in key financial metrics. Net sales and adjusted EBITDA surpassed guidance, driven primarily by a significant 44% growth in OEM sales. Dragonfly Energy’s strategic financial actions, including public offerings and debt restructuring, have also contributed to strengthening its financial position.
Strong OEM Sales Propel Q3 Net Sales Growth
Dragonfly Energy’s third-quarter net sales hit $16.0 million, a 25.5% increase compared to the same period last year. The company’s OEM sales were the standout contributor, growing 44.3% to $10.7 million. This growth reflects the growing adoption of Dragonfly’s products among RV manufacturers, who are increasingly incorporating its solutions as standard equipment. Direct-to-consumer (DTC) sales remained steady, although slightly down by 2.2% at $5.0 million, amid ongoing macroeconomic challenges. Licensing fees also saw a notable increase, rising by 49.7%.
The company’s gross profit surged 65.0% year-over-year, reaching $4.7 million. Gross margin improved by 710 basis points, from 22.6% to 29.7%, driven by higher sales volume and favorable product mix. Additionally, Dragonfly benefitted from cost optimization initiatives, contributing to its improved financial performance.
Adjusted EBITDA Improves, Reflecting Strong Operational Execution
Adjusted EBITDA for the third quarter stood at $(2.1) million, a marked improvement from $(5.5) million last year. While still in the negative, the adjusted figure highlights Dragonfly’s strong operational execution, even as the company continues to invest in its growth. The company’s net loss increased to $(11.1) million, up from $(6.8) million a year ago. This increase was driven by ongoing investment in scaling operations and research, reflecting Dragonfly’s long-term growth ambitions.
Dragonfly’s progress in improving its gross margin and reducing operating expenses provides a solid foundation for future growth. Operating expenses for the quarter declined to $8.5 million, down from $8.9 million last year, with R&D expenses contributing to the savings. This performance demonstrates the company’s ability to maintain efficient operations while driving revenue growth.
Financial Position Strengthened with Debt Restructuring and Public Offerings
Dragonfly Energy has made significant moves to strengthen its financial position in recent months. The company completed three public offerings, raising approximately $90 million in gross proceeds. These efforts, combined with a comprehensive debt restructuring agreement, have reduced outstanding debt and increased liquidity. As a result, Dragonfly now has greater financial flexibility, enabling it to pursue strategic opportunities and further investments in energy storage and battery technology.
CEO Dr. Denis Phares emphasized that these steps are crucial to positioning the company for long-term success. “These capital actions have created a solid foundation for sustained growth,” he stated. With its financial position significantly improved, Dragonfly Energy is now poised for continued expansion in its core markets and beyond.
Outlook for Fourth Quarter 2025
Dragonfly Energy expects fourth-quarter net sales to reach approximately $13.0 million, representing a 7% increase year-over-year. The company forecasts an adjusted EBITDA of $(3.3) million for the quarter. While the company remains in a loss position, it is confident that its strategic actions will lead to future profitability. The improvement in its financial performance and operational execution positions Dragonfly Energy for a successful future, despite the challenges that lie ahead.
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