Executive Summary

Revenue fell 4% YoY to $12.64M as New York residential and service softness outweighed strong commercial growth; gross margin held at 35.1% (36.4% LY) and adjusted EBITDA was roughly flat at $(1.46)M .
Cost actions and deleveraging showed through: SG&A fell 9% to $6.04M, interest expense declined 25% to $0.57M, cash rose to $1.45M, and total debt was reduced ~51% to $9.2M vs. 12/31/24 (includes earnout) .
Management introduced FY25 guidance: sales $65–$70M and adjusted EBITDA $0.5–$0.7M, citing improving demand, a >30% YoY increase in NY commercial backlog, and benefits from restructuring and debt payoff .
Potential catalysts/risks: execution on rising commercial and residential backlog into Q2/Q4 seasonally stronger periods; policy/tariff/ITC uncertainty and mix (battery attachment) pressure near-term pricing in Hawaii; deleveraging and cost discipline support multiple re-rating if guidance is met .

What Went Well and What Went Wrong

What Went Well
- Cost discipline and deleveraging: SG&A down 9% to $6.04M; interest expense down 25% to $0.57M; total debt reduced to $9.2M from $19.1M at 12/31/24; cash rose to $1.45M .
- Commercial momentum and backlog: SUNation commercial revenue +28% YoY; commercial backlog ~$7.4M (+32% YoY) as of Q1 (and “rose more than 30%” YoY per release) .
- Initial transformation impact: CEO highlighted “cost containment, operating efficiencies, improved cash position, and debt reduction”; CFO reiterated SG&A and interest savings, and guidance confidence .
- Quote (CEO): “Our results for Q1 2025 reflect the initial successes associated with our corporate transformation activities...” .
- Quote (CFO): “The restructuring and debt reduction initiatives… significantly reduced monthly cash burn, enhanced cash flows, and stabilized our financial profile” .
What Went Wrong
- Revenue down 4% YoY to $12.64M; consolidated gross margin down ~130 bps to 35.1%; New York residential and service weakness (seasonality/poor weather) and Hawaii revenue decline weighed on results .
- Net loss of $(3.50)M vs. +$1.20M LY driven by lack of prior-year non-cash gains (e.g., warrant remeasurement) and financing fees; operating loss roughly flat YoY .
- Hawaii softness: HEC revenue declined 11% to $3.09M on lower battery kilowatts (incentives resumed mid-May), pressuring mix and per-watt pricing .
- Analyst concerns (tone): management cited policy/tariff and incentive uncertainty; residential seasonality and battery attachment mix affecting per-watt pricing; margin pressure on larger commercial projects due to higher unanticipated costs .

Financial Results

Consolidated performance

Metric	Q1 2024	Q1 2025
Revenue ($)	$13,219,197	$12,636,638
Gross Profit ($)	$4,805,448	$4,431,325
Gross Margin (%)	36.4%	35.1%
SG&A ($)	$6,629,027	$6,039,298
Operating Loss ($)	$(2,182,954)	$(2,167,348)
Interest Expense ($)	$764,870	$571,240
Net (Loss) Income ($)	$1,202,651	$(3,496,432)
Diluted EPS ($)	$(38,414.84) (split-adjusted)	$(106.71)
Adjusted EBITDA ($)	$(1,509,570)	$(1,464,215)

Balance sheet and liquidity (period-end unless noted)

Metric	12/31/2024	3/31/2025
Cash & Cash Equivalents ($)	$839,268	$1,447,329
Restricted Cash ($)	$312,080	$292,901
Total Debt ($)	$19,100,000 (incl. earnout)	$9,200,000 (incl. earnout)
Accounts Payable ($)	$8,032,769	$6,514,331
Stockholders’ Equity ($)	$8,547,416	$14,806,897

Segment revenue and mix

Segment	Q1 2024 Revenue ($)	Q1 2025 Revenue ($)
SUNation (NY/FL): Residential	$8,131,708	$7,896,122
SUNation (NY/FL): Commercial	$997,193	$1,275,888
SUNation (NY/FL): Service	$624,069	$372,544
HEC (Hawaii): Residential	$3,227,879	$2,738,800
HEC (Hawaii): Service	$238,348	$353,284
Total Consolidated	$13,219,197	$12,636,638

Margins and KPIs

KPI	Q1 2024	Q1 2025
Consolidated Gross Margin (%)	36.4%	35.1%
SUNation Gross Margin (%)	40.5%	38.5%
HEC Gross Margin (%)	24.6%	24.5%
Commercial Backlog ($)	$5.6M (derived from +32% YoY to $7.4M)	$7.4M

Notes: EPS and share metrics reflect multiple reverse stock splits (1-for-15 in June 2024, 1-for-50 in Oct 2024, 1-for-200 in Apr 2025) .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Sales ($)	FY 2025	None	$65M–$70M	Introduced
Adjusted EBITDA ($)	FY 2025	None	$0.5M–$0.7M	Introduced

Earnings Call Themes & Trends

Note: We did not find prior-quarter (Q4’24, Q3’24) earnings documents to extract themes; trend view below centers on Q1’25 commentary [ListDocuments 2024 returned none].

Topic	Previous Mentions (Q-2, Q-1)	Current Period (Q1 2025)	Trend
Cost discipline & deleveraging	N/A	SG&A ↓9%; interest ↓25%; debt reduced ~51%; cash ↑	Improving financial profile
Commercial backlog	N/A	NY commercial backlog +32% YoY to ~$7.4M; >30% cited in PR	Strengthening pipeline
Residential demand & seasonality	N/A	NY resi slowed by seasonality/weather in Feb; spring pickup underway	Rebound into Q2 seasonality
Hawaii incentives/battery mix	N/A	HEC softer on battery mix; incentives resumed May 15, 2025	Tailwind returning mid-Q2
Tariffs/ITC policy uncertainty	N/A	Monitoring tariffs and residential ITC debate; prepared to pivot	Policy risk managed via flexibility
Capital structure & liquidity	N/A	Elimination/restructure of expensive debt; new $1.0M LOC unused	Flexibility improved

Management Commentary

Prepared remarks (CEO): “Our results for Q1 2025 reflect the initial successes associated with our corporate transformation activities, most notably in… cost containment, operating efficiencies, improved cash position, and debt reduction.”
Prepared remarks (CFO): “Q1 2025 selling, general and administrative expenses declined by 9%… and interest expense decreased by 25%… We improved our cash position and lowered our debt by more than 50% from December 31, 2024.”
New York market: “SUNation’s Commercial backlog as of March 31, 2025 rose more than 30%… While our New York Residential business experienced typical seasonal headwinds… we are addressing pent up demand… stronger than usual Springtime push.”
Hawaii market: “Residential business in Hawaii… expected to rebound from a sluggish 2024 due to solar and battery incentives that took effect in May 2025.”
Strategy: “We are pursuing… organic and acquisition-based initiatives… evolve our model into a one-stop shop for solar and storage related needs.”

Q&A Highlights

Path to positive EBITDA: Management declined to give quarterly guidance but reiterated seasonal pattern (Q1 lower; ramp in Q2–Q4) and FY25 adjusted EBITDA of $0.5–$0.7M .
Operating costs outlook: Further streamlining opportunities remain, including through roll-up strategy that can lower overlapping costs across acquired companies .
Acquisition criteria: Target regional operators >$20M revenue, EBITDA positive, diversified revenue streams (residential/commercial/service), strong customer reviews to lower CAC .
Tariffs/batteries: Monitoring tariff volatility; partners have absorbed some battery tariff cost; not in “panic mode” but prepared to pivot as policy evolves .
Bitcoin treasury: Framework in place but awaiting “excess cash” (6 months forward cash needs first); potential later in year given seasonal cash build .

Estimates Context

S&P Global shows no published Wall Street consensus for Q1 2025 EPS, revenue, or EBITDA for SUNE; therefore, we benchmarked results against prior-year comps and company guidance. Values retrieved from S&P Global*.

Key Takeaways for Investors

Cost actions are taking hold: SG&A down, interest down, and debt halved vs. year-end; these should support operating leverage as volumes normalize in Q2–Q4 .
Demand visibility improving: NY commercial backlog +32% YoY and spring residential demand recovery support FY sales ramp; Hawaii incentives should lift battery attachment later in 2025 .
Guidance sets a bar: FY25 $65–$70M revenue and $0.5–$0.7M adjusted EBITDA provide a tangible yardstick; execution on backlog conversion and margin discipline are the swing factors .
Policy and mix risks remain: Battery attachment in Hawaii and tariff/ITC headlines can swing per-watt pricing and resi conversion; management signaled flexibility to pivot (TPO/financing models) .
Balance sheet cleaner: Reduced debt and interest burden, plus improved cash, lower the break-even and provide optionality for targeted M&A to diversify and smooth cyclicality .
Near-term trading: Positive surprises would be faster-than-expected backlog conversion and sustained gross margins in NY; watch for updates on resi demand cadence, commercial project timing, and incentive/tariff developments .
Medium-term thesis: Regional leader with diversified revenue streams pursuing consolidation; if management hits guidance and maintains cost rigor, multiple re-rating potential increases .

Supplementary detail

Q1 2025 Financial Results Overview (per press release and 10-Q): revenue $12.64M (–4% YoY), gross profit $4.43M (35.1%), SG&A $6.04M (–9%), interest expense $0.57M (–25%), net loss $(3.50)M (vs. +$1.20M LY largely due to prior-year non-cash gains), adjusted EBITDA $(1.46)M (flat YoY) .
Financial condition: cash & equivalents $1.45M; restricted cash $0.29M; total debt $9.2M including $2.1M earnout; AP down by $1.5M; current liabilities down by $6.9M; stockholders’ equity up by $6.3M vs 12/31/24 .
Guidance (FY 2025): total sales $65–$70M (+14% to +23% vs. 2024’s $56.9M); adjusted EBITDA $0.5–$0.7M (improvement from 2024 loss) .

* S&P Global estimates note: No Q1’25 consensus values were available; statement based on S&P Global platform retrieval (GetEstimates).

SUNation Energy, Inc. (SUNE)·Q1 2025 Earnings Summary