Dragonfly Energy, a leader in energy storage solutions, has announced significant corporate actions alongside its preliminary financial results for the fourth quarter and full year of 2025. The company reported a 16% increase in overall revenue, driven largely by a remarkable 34% growth in Original Equipment Manufacturer (OEM) sales. This surge reflects the company's expanding partnerships and ongoing demand for its products.
In a move aimed at enhancing its financial health, Dragonfly Energy revealed plans to reduce expenses and improve its cost structure. The company is targeting positive adjusted EBITDA at a $70 million annual revenue run rate, providing a clearer alignment with shareholder interests. This strategic shift is expected to lay a solid foundation for long-term profitability. Learn more on Investopedia.
Fourth Quarter 2025 Financial Performance
For the fourth quarter of 2025, Dragonfly Energy reported net sales of $13.1 million, reflecting a 6.9% increase from the previous year. The OEM segment was a standout performer, with sales climbing 30.1% to $8.1 million, driven by strong uptake of Dragonfly's products in factories. However, direct-to-consumer (DTC) sales experienced a decline, dropping to $4.7 million from $5.7 million due to ongoing macroeconomic challenges and a diminished focus on DTC sales.
The company's gross profit was recorded at $2.4 million, resulting in a gross margin of 18.2%. This marks a slight decline from a gross profit of $2.5 million and a gross margin of 20.8% in the prior year, attributed to a year-end inventory adjustment and reduced sales volumes. Operating expenses surged to $12.6 million, compared to $9.7 million the previous year, largely due to one-time expenses linked to debt restructuring and lease impairments.
Full Year 2025 Overview
Over the entire year, Dragonfly Energy's net sales reached $58.6 million, an increase of 15.8% year-over-year. OEM net sales for the year totaled $36.9 million, marking a 34% growth that underscores the increasing demand within the energy sector. The company's gross margin for the full year improved to 26.7%, contributing to a gross profit of $15.6 million.
Despite these gains, Dragonfly faced a net loss of $(69.9) million for the year, or $(14.92) per diluted share, compared to a net loss of $(45.0) million, or $(13.89) per diluted share in the prior year. The adjusted EBITDA, which excludes stock-based compensation and one-time charges, was $(11.8) million, reflecting an increase in losses compared to $(3.8) million the previous year. The year-over-year declines highlight the ongoing challenges the company is addressing as it strives for operational efficiency.
Strategic Cost Realignment Initiative
As part of its ongoing commitment to improving financial stability, Dragonfly Energy implemented a strategic cost realignment in March 2026. This initiative aims to streamline operations and reduce annual operating expenses by approximately $8.9 million. The focus of this realignment is to better align the company's incentives with those of its shareholders and to sharpen its focus on commercial channels, particularly within the OEM, trucking, and industrial markets.
"As we approach the second quarter of 2026, we remain focused on expanding OEM relationships, improving operational efficiency, and strengthening our financial foundation to support our path to sustainable profitability," said a company spokesperson. This proactive approach is expected to enhance Dragonfly's market position and set the stage for future growth.
Overall, Dragonfly Energy's preliminary results for 2025 indicate a company in transition, navigating challenges while seizing growth opportunities. With a strategic focus on cost management and an eye toward profitability, the company is poised for an optimistic future as it works to solidify its standing in the energy storage market.
Originally reported by Benzinga. View original.