Expion360 Inc. (XPON)·Q2 2025 Earnings Summary

Executive Summary

• Net sales grew 134% year over year to $3.00M and 46% sequentially, marking the sixth consecutive quarter of growth; gross margin compressed to 21% due to tariff uncertainty and mix shift to lower-margin pass-through accessories .
• Net loss improved 38% YoY to $1.37M; SG&A was flat in dollars but fell to 66% of sales from 157% in Q2 2024, reflecting operating leverage and cost controls .
• Management highlighted momentum in Home Energy Storage Solutions (HESS), with one product achieving UL9540 and another near approval; pursuing tariff exclusions and diversifying supply chain including onshoring components over time .
• Catalysts: regained Nasdaq bid-price compliance, strong OEM/dealer demand, and HESS certification progress; tariff policy and sales mix remain key swing factors for margins .

What Went Well and What Went Wrong

What Went Well

• Sixth straight quarter of sequential revenue growth; two of the most successful monthly sales periods in company history .
• Operating efficiency: SG&A flat YoY in dollars and down ~91 percentage points as a percentage of sales; net loss improved 38% YoY .
• HESS commercialization advancing: one product UL9540-certified, second nearing UL approval; management sees strong distribution and technology roadmap (Edge battery, SmartTalk Bluetooth, CAN bus) .

What Went Wrong

• Gross margin fell from 24% in Q1 to 21% in Q2 on tariff uncertainty and higher accessory mix; margins remain sensitive to mix and policy .
• Cash balance ended Q2 at $0.685M, down from $1.093M at Q1; inventory levels remain high, requiring working-capital discipline .
• Consensus estimates appear unavailable; limited external benchmarks reduce clarity on beat/miss and may dampen investor conviction in near-term [GetEstimates: Q2 2025, values retrieved from S&P Global]*.

Financial Results

Notes:

• Year-over-year: Revenue +134% to $3.00M; gross profit +91% to ~$0.62M; net loss improved from $2.22M to $1.37M .
• Sequential: Revenue +46%; gross margin down 300 bps due to tariff uncertainty and pass-through accessory mix .

KPIs and Balance Sheet/CF

Segment breakdown: Company does not report revenue by segment; growth driven by RV market and accessory sales via integrator partners .

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “The second quarter of 2025 was highlighted by two of the most successful sales months in our history… Net sales grew 134% year over year to $3.0 million, and sequentially for a sixth consecutive quarter…” — Brian Schaffner, CEO & Interim CFO .
• “Gross margin was adversely affected by ongoing tariff uncertainty… decreasing from 24% in Q1 2025 to 21% in Q2 2025… We are… diversifying our supply chain and… transitioning certain products to U.S.-based manufacturers… Our long-term goal is to onshore manufacturing of most of our components and assemblies.” .
• “Of our two home energy product options, one has achieved UL9540 certification, and the second is in the final stages of UL approval.” .
• “We believe we are well positioned to execute on our key growth initiatives, including adding OEM partnerships and distributors, further developing HESS, and introducing new technologies and batteries.” .

Q&A Highlights

• Tariff outlook: Management “feels confident” in lobbying efforts for an exclusion; benefited from preloading inventory in late 2024 .
• Inventory depth: Over $5.0M in inventory available for sale represents the majority of prebuilt stock; actively planning replacement heading into 2026 .
• Margin trajectory: Accessory share weighed on margins in Q2; expects battery mix to support a stronger margin profile in Q3 .

Estimates Context

• Q2 2025 consensus (S&P Global): No published Wall Street consensus for revenue or EPS; S&P shows actual revenue of $2.99M and actual EBITDA of $(1.32)M, with no EPS or estimate counts available for the quarter [GetEstimates: Q2 2025, values retrieved from S&P Global]*.
• Implication: With limited external coverage, the stock may trade more on company-reported momentum (sequential growth, HESS certification, listing compliance) and qualitative updates on tariffs/mix than on beat/miss optics.

*Values retrieved from S&P Global.

Key Takeaways for Investors

• Revenue momentum is real: six straight sequential increases, +46% QoQ and +134% YoY in Q2, driven by RV demand and accessory sales; watch for battery mix normalization to support margins in Q3 .
• Margin sensitivity persists: Q2 gross margin fell to 21% due to tariffs and mix; progress in supply-chain diversification and onshoring could be medium-term margin levers .
• HESS is gaining regulatory footing: one UL9540-certified product, second near approval—key for California incentives; this vertical can diversify revenue and margin profile .
• Operating leverage improving: SG&A down sharply as a % of sales and net loss improved 38% YoY; continue monitoring cash discipline with ~$0.685M cash at quarter-end and inventory working-capital needs .
• OEM/channel breadth: >300 customers and named OEMs (Scout, Alaskan, KZ RV) create durability; tracking conversion to sustained higher battery mix is crucial for gross margin .
• Listing/compliance: Nasdaq minimum bid price compliance regained—reduces overhang; investor focus likely shifts back to execution and margin recovery .
• Estimates scarcity: With limited Street coverage, narrative/margin trajectory and policy developments (tariffs) may be primary drivers of stock reaction rather than consensus beats/misses [GetEstimates: Q2 2025, values retrieved from S&P Global]*.

Citations:

• Q2 2025 press release:
• Q2 2025 8-K (Item 2.02 and exhibits):
• Q2 2025 earnings call transcript:
• Q1 2025 press release/8-K:
• Q4 2024 press release/8-K:
• Estimates: [GetEstimates: Q2 2025, values retrieved from S&P Global]*