Executive Summary

Q2 FY2025 delivered revenue of $6.82M and gross margin of 42.6%, but operating expenses (+54.5% YoY) drove a net loss of $1.14M and negative EBITDA of $1.19M .
Retail ($5.9M) held up better than wholesale ($0.9M), as wholesale declined on the closure of two major customer stores; retail demand was pressured by NYC lithium-battery incidents, which management cited as a key headwind .
Management emphasized margin resiliency (H1 FY2025 GM 40.9% vs. 39.0% LY) helped by better battery pricing, while opex increased with expansion, IPO-related costs, and rental/app investments .
No formal guidance was provided in the Q2 press release/8-K; Wall Street consensus (S&P Global) for Q2 was unavailable, so estimate beat/miss cannot be assessed (values unavailable; S&P Global) .
Near-term catalysts: regulatory safety narrative in NYC and adoption of UL-certified products/rental services; expansion to Miami/LA/Toronto and new e-motorcycle models could support retail mix and brand engagement .

What Went Well and What Went Wrong

What Went Well

Maintained gross margin stability despite revenue pressure: Q2 GM 42.6% (vs. 42.9% LY); H1 GM improved to 40.9% (vs. 39.0% LY), driven by better battery pricing and unit cost reductions .
Strategic initiatives advancing: launch of e-bike Rental Service and ongoing development of mobile apps to enhance customer convenience and engagement .
Product lineup broadened and well-received: 11 models showcased at Electrify Expo (1,500+ test rides), with three new e-motorcycle models (DT, EK, DP) drawing strong feedback .

What Went Wrong

Topline contraction and mix shift: Q2 revenue fell 22.1% YoY to $6.82M on a 5,850 unit decline (15,056 vs. 20,906), with wholesale -54.8% and retail -12.5% .
Operating expenses surged 54.5% YoY to $4.14M, reflecting payroll, rent, advertising, professional fees, and insurance associated with expansion and public-company obligations .
Profitability deteriorated: net loss of $1.14M (vs. $0.75M income LY), EPS -$0.05 (vs. $0.03 LY), EBITDA -$1.19M (vs. $1.25M LY), with EBITDA margin -17.5% .

Financial Results

Consolidated P&L Snapshot (YoY, QoQ, and current)

Metric	Q2 FY2024	Q1 FY2025	Q2 FY2025
Revenue ($USD Millions)	$8.76	$7.87	$6.82
Gross Profit ($USD Millions)	$3.76	$3.10	$2.90
Gross Margin %	42.9%	39.4%	42.6%
Total Operating Expenses ($USD Millions)	$2.68	$3.15	$4.14
Net Income ($USD Millions)	$0.75	-$0.18	-$1.14
EPS ($USD)	$0.03	-$0.01	-$0.05
EBITDA ($USD Millions)	$1.25	$0.06	-$1.19
EBITDA Margin %	14.3%	0.7%	-17.5%

Segment Revenue Mix

Segment	Q2 FY2024 ($M)	Q1 FY2025 ($M)	Q2 FY2025 ($M)
Retail	$6.8	$6.9	$5.9
Wholesale	$2.0	$1.0	$0.9

KPIs

KPI	Q2 FY2024	Q1 FY2025	Q2 FY2025
Units Sold (EVs)	20,906	10,300	15,056
Gross Margin %	42.9%	39.4%	42.6%
EBITDA Margin %	14.3%	0.7%	-17.5%
Cash And Equivalents ($M)	N/A	$4.47	$1.27

Notes:

Battery unit cost decreased in H1 FY2025 to $75 from $117 (36% reduction), contributing to margin support .
Wholesale decline tied to two top customers closing stores; retail demand affected by NYC lithium-battery incidents .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY/Q2 FY2025	None provided	None provided	Maintained (no formal guidance)
Gross Margin %	FY/Q2 FY2025	None provided	None provided	Maintained (no formal guidance)
OpEx	FY/Q2 FY2025	None provided	None provided	Maintained (no formal guidance)
Other (OI&E, tax rate, dividends)	FY/Q2 FY2025	None provided	None provided	Maintained (no formal guidance)

Earnings Call Themes & Trends

No Q2 FY2025 earnings call transcript was available, so themes reflect management commentary across documents.

Topic	Previous Mentions (Q-2: FY2024)	Previous Mentions (Q-1: Q1 FY2025)	Current Period (Q2 FY2025)	Trend
Safety/Regulatory (NYC lithium incidents, UL-certified)	Emphasis on brand, channel expansion; no specific safety incidents highlighted	Launch of rental program aligned with UL-certified e-bikes; app development for rentals	Retail demand pressure from NYC lithium-battery incidents; focus on UL-certified products and trade-in program participation	Heightened regulatory/safety focus
Rental Program & App (GO FLY)	Investment in Fly E-Bike app; scaling sales network	Rental service launched; GO FLY app in development	Rental service expansion; ongoing mobile app development to enhance convenience	Program scaling
Product & R&D	Product upgrades driving ASP/margin improvements	Higher ASP and gross margin; store additions	11-model lineup; three new e-motorcycles (DT, EK, DP); strong event feedback	Portfolio expansion
Supply Chain/Costs	Logistics costs up with imported parts; margin improved YoY	Battery unit cost down to $69, aiding COGS	Battery unit cost lower in H1; margin stable	Cost tailwinds continue
Geographic Expansion	Online/territory expansion	Store expansion drove retail growth	Expansion to Miami, Los Angeles, Toronto	Broader footprint
Wholesale Concentration	Not highlighted	Top-two customers closed stores; wholesale decline	Continued wholesale decline from customer store closures	Structural headwind

Management Commentary

“In the second quarter of fiscal year 2025, we held a stable gross margin above 40%, even as operating expenses increased with our efforts to add e-bike rental business. For the first half of fiscal 2025, our gross margin improved to 40.9%, up from 39.0% last year” — Zhou (Andy) Ou, CEO .
“The launch of our e-bike Rental Service offers customers a flexible, affordable way to experience our products… we’re expanding into key markets like Miami, Los Angeles and Toronto” .
“Our involvement in New York City’s Trade-in Program for e-bikes and batteries is aligned with our commitment to setting high safety standards… helping provide UL-certified e-bikes for delivery workers” .
Prior quarter tone: “Gross profit increase of 13.8%… driven by increased average sales price per EV and decreased cost of revenue via supplier cooperation for battery pricing” .

Q&A Highlights

No Q2 FY2025 earnings call transcript was found; therefore, Q&A highlights and any guidance clarifications are unavailable [ListDocuments earnings-call-transcript returned 0].

Estimates Context

Wall Street consensus (S&P Global) for Q2 FY2025 EPS and revenue was unavailable due to data limitations; as a result, we cannot determine a beat/miss versus consensus at this time (values unavailable; S&P Global).
Investors should monitor future filings/calls for formal guidance or analyst estimate revisions .

Key Takeaways for Investors

Margin resilience offset some demand headwinds: Q2 GM 42.6% and H1 GM 40.9% benefited from lower battery costs, despite revenue decline and elevated OpEx .
Demand headwinds are real in NYC: management directly tied retail softness to lithium-battery incidents; positioning UL-certified offerings and trade-in programs is pivotal to restore confidence .
Wholesale channel risk persists: store closures among top customers materially reduced wholesale revenue; channel diversification and retail emphasis remain pragmatic .
Strategic levers in motion: rental program + app ecosystem, new e-motorcycle models, and geographic expansion (Miami/LA/Toronto) could drive retail mix, brand engagement, and potentially stabilize volumes .
Operating cost control is a watch item: opex rose 54.5% YoY in Q2 amid expansion and public-company costs; focus on ROI from new initiatives will be crucial to restore profitability .
Liquidity trend: cash was $1.27M at 9/30/2024 vs. $4.47M at 6/30/2024; financing inflows in H1 offset operating/investing outflows, but working capital and capex plans warrant monitoring .
Next steps: With no formal guidance and estimates unavailable, track subsequent disclosures for demand normalization in NYC, rental uptake, and margin trajectory; assess whether retail gains can offset wholesale structural pressures .

Sources: Q2 FY2025 press release/8-K and related exhibits ; Q1 FY2025 press release/8-K ; FY2024 press release/8-K (context) .

Fly-E Group, Inc. (FLYE)·Q2 2025 Earnings Summary