8-K: Dragonfly Energy Exceeds Q3 Guidance with 26% Sales Growth

Dragonfly Energy Holdings Corp. announced preliminary third quarter 2025 results, exceeding guidance for Net Sales and Adjusted EBITDA with 26% year-over-year sales growth.

Summary

• Preliminary third quarter 2025 Net Sales are anticipated to be $16.0 million, surpassing the company's guidance of $15.9 million.
• Preliminary third quarter 2025 Adjusted EBITDA is anticipated to be $(2.2) million, which is better than the guidance of $(2.7) million.
• Anticipated Net Sales represent a 26% year-over-year growth compared to the prior year's third quarter.
• The Adjusted EBITDA loss for Q3 2025 shows an approximate $3.3 million reduction compared to the prior year.
• The company attributes these results to a continued focus on driving near-term revenue growth and executing strategic actions, including a recent equity raise.
• These preliminary financial results are subject to finalization and adjustment in connection with the preparation of the Quarterly Report on Form 10-Q.

Sentiment

Score: 7

Explanation: The company exceeded its own guidance for both Net Sales and Adjusted EBITDA, demonstrating strong year-over-year sales growth (26%) and a significant reduction in EBITDA loss. This indicates positive operational momentum and effective strategic execution, including a recent equity raise to bolster financial flexibility. However, the company is still reporting an Adjusted EBITDA loss, and the results are preliminary, warranting some caution.

Positives

• Preliminary Q3 2025 Net Sales of $16.0 million exceeded the company's guidance of $15.9 million.
• Preliminary Q3 2025 Adjusted EBITDA of $(2.2) million was better than the company's guidance of $(2.7) million.
• Net Sales grew by 26% year-over-year, demonstrating strong revenue momentum.
• Adjusted EBITDA loss was reduced by approximately $3.3 million year-over-year, indicating improved operational efficiency.
• A recent equity raise has enhanced financial flexibility and is expected to position the company for sustained net sales growth and profitability.

Negatives

• The company still reported a preliminary Adjusted EBITDA loss of $(2.2) million, indicating continued unprofitability.
• The preliminary financial results are subject to finalization and adjustment, and investors are cautioned against drawing inferences from this information.

Risks

• The ability to successfully achieve thresholds for additional funding from offerings.
• The potential impact of offerings and the conversion and sale of common stock on the company's stock price.
• The need for improved recovery in core markets, including the RV market.
• The ability to successfully increase market penetration into target markets and penetrate new markets like heavy-duty trucking.
• The ability to retain members of its senior management team and other key personnel.
• The ability to maintain relationships with key suppliers, including those in China, and key customers.
• The ability to protect its patents and other intellectual property.
• The ability to successfully utilize its patented dry electrode battery manufacturing process and optimize solid-state cells, including producing commercially viable solid-state cells in a timely manner or at all, and scaling to mass production.
• The ability to timely achieve the anticipated benefits of its licensing arrangement with Stryten Energy LLC and customer arrangements with THOR Industries.
• The ability to maintain the listing of its common stock and public warrants on the Nasdaq Capital Market.
• The impact of geopolitical conflicts, such as the Russian/Ukrainian conflict.
• The ability to generate revenue from future product sales and achieve and maintain profitability.
• The ability to compete with other manufacturers in the industry and successfully engage target customers.

Future Outlook

The company anticipates sustained net sales growth and profitability, driven by a continued focus on near-term revenue growth and strategic actions, including a recent equity raise. They also aim for the future deployment of their proprietary, nonflammable, all-solid-state battery cells.

Management Comments

• "Preliminary third quarter Net Sales and Adjusted EBITDA exceeded our guidance, marking another quarter of year-over-year Net Sales growth and Adjusted EBITDA improvement."
• "These results underscore our continued focus on driving near-term revenue growth and executing strategic actions, including a recent equity raise, that we believe enhance our financial flexibility and have the potential to position us for sustained net sales growth and profitability."

Industry Context

Dragonfly Energy operates in the rapidly evolving energy storage and battery technology sector, specializing in lithium batteries. The company highlights its leadership in the industry with its Battle Born Batteries brand and its patented dry electrode manufacturing process, which positions it for growth in energy storage systems, electric vehicles, and consumer electronics. The focus on nonflammable, all-solid-state battery cells indicates a strategic move towards advanced, safer battery technologies, aligning with broader industry trends for improved performance and safety and addressing critical market demands.

Comparison to Industry Standards

• The filing does not provide specific comparable companies, projects, or results to global benchmarks, limiting a direct industry-wide comparison.
• The 26% year-over-year Net Sales growth is a strong indicator within the energy storage sector, which is experiencing significant demand and growth. This rate suggests the company is capturing market share or benefiting from overall market expansion.
• The continued Adjusted EBITDA loss, while improved, suggests the company is still in a growth and investment phase, which is common for technology companies developing advanced solutions like solid-state batteries. This contrasts with more mature, profitable companies in established segments of the battery market.

Stakeholder Impact

• Shareholders: Positive preliminary results exceeding guidance and strong sales growth could lead to increased investor confidence. The recent equity raise and potential impact on stock price are noted risks.
• Customers: Continued growth and focus on advanced battery technology (solid-state) suggest ongoing product development and supply, potentially benefiting customers.
• Employees: Continued growth and strategic focus may indicate stability and future opportunities.
• Suppliers: Maintaining relationships with key suppliers, including those in China, is identified as a risk, indicating their importance to operations.

Next Steps

• Finalization and adjustment of preliminary financial results for the three months ended September 30, 2025.
• Preparation of the Quarterly Report on Form 10-Q for the three months ended September 30, 2025.
• Host a conference call on November 14, 2025, at 4:30 PM Eastern Time to discuss Q3 2025 financial and operational results.
• Continued focus on driving near-term revenue growth and executing strategic actions.
• Future deployment of proprietary, nonflammable, all-solid-state battery cells.

Key Dates

Recommendation

The company delivered preliminary Q3 2025 results that exceeded its own guidance for both Net Sales and Adjusted EBITDA, coupled with strong 26% year-over-year sales growth. This indicates positive operational momentum and effective strategic execution, including a recent equity raise to bolster financial flexibility. However, the company is still operating at an Adjusted EBITDA loss, and the results are preliminary, subject to finalization. While the growth is encouraging, the continued unprofitability and the preliminary nature of the results suggest a 'hold' position until the full audited financials are released and a clearer path to sustained profitability is demonstrated. The long-term potential in solid-state battery technology is promising but carries significant execution risks.

Keywords

Dragonfly Energy, DFLI, Lithium Battery, Energy Storage, Battery Technology, Preliminary Results, Net Sales, Adjusted EBITDA, Q3 2025, Battle Born Batteries, Dry Electrode, Solid-State Battery, SEC Filing, 8-K