Expion360 Q2 2025 Earnings Report

Expion360 EPS Results

• Actual EPS: -$0.41
• Consensus EPS: -$0.58
• Beat/Miss: Beat by +$0.17
• One Year Ago EPS: N/A

Expion360 Revenue Results

• Actual Revenue: $2.99 million
• Expected Revenue: $2.14 million
• Beat/Miss: Beat by +$854.00 thousand
• YoY Revenue Growth: N/A

Expion360 Announcement Details

• Quarter: Q2 2025
• Date: 8/13/2025
• Time: After Market Closes
• Conference Call Date: Wednesday, August 13, 2025
• Conference Call Time: 4:30PM ET

Expion360 (NASDAQ:XPON), trading under the ticker XPON on the NASDAQ, is a cybersecurity software company that operates through its Leviathan Security Group division. The company’s flagship offering, the Leviathan Platform, delivers a unified risk management solution designed to help organizations identify, assess and remediate cybersecurity vulnerabilities. By consolidating compliance management, threat detection and data protection into a single platform, Expion360 enables enterprises to streamline security workflows and maintain continuous visibility into their cyber risk posture.

The Leviathan Platform encompasses modules for vulnerability scanning, automated compliance mapping to frameworks such as NIST, HIPAA and PCI DSS, real-time threat intelligence and incident response orchestration. These capabilities are accessible via cloud-hosted services or on-premises deployments and integrate with common IT and security infrastructure, including endpoints, cloud workloads and network devices. Professional services teams support customers with deployment, customization, training and ongoing assessments to ensure alignment with evolving regulatory requirements.

Founded in 2018 and headquartered in Tampa, Florida, Expion360 serves organizations across financial services, healthcare, manufacturing and other regulated industries in North America and select international markets. The company completed a business combination in 2022 to become a publicly traded entity, and its leadership team brings together cybersecurity veterans with backgrounds in risk management, threat intelligence and software engineering. Expion360 continues to invest in platform enhancements and strategic partnerships to address the growing demand for integrated, scalable cybersecurity solutions.

Expion360 Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Revenue grew 134% year-over-year to $3.0 million in Q2, marking the company’s sixth consecutive quarter of sequential growth.
• Positive Sentiment: Net loss improved by 38% to $1.4 million, driven by higher sales and a 91-percentage-point reduction in selling, general and administrative expenses as a percentage of revenue.
• Negative Sentiment: Gross margin declined to 21% from 25% due to product mix and tariff uncertainty, though management is mitigating impacts through inventory builds, cost reductions and supply diversification.
• Positive Sentiment: Introduced the HESS home energy storage line with shipments beginning January 2025, targeting residential/commercial solar, AI data center backup markets, and nearing UL certification.
• Positive Sentiment: Expanded distribution to over 300 dealers and OEMs—including Camping World, KZ RV, Scout Campers and Alaskan Campers—strengthening national market penetration.

Presentation

[Operator]

Greetings, and welcome to the XPO360 Second Quarter twenty twenty five Financial Results Conference Call. At this time, all participants are in listen only mode. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded and will be available on the company's Investor Relations website at investors.xpn360.com. Before we begin the formal presentation, I would like to remind everyone that certain statements made on this call and through the webcast are forward looking statements within the meaning of federal securities laws and are subject to considerable risks and uncertainties.

[Operator]

These forward looking statements are intended to qualify for the Safe Harbor from liability established by the Private Securities Litigation Reform Act of 1995. All statements made on this call today other than statements of historical facts are forward looking statements and include statements regarding the company's beliefs, plans, and expectations about its operations, growth prospects, product development and pipeline, ability to execute its long term growth strategy, anticipated timing of commercial availability of its products, market size, and opportunity, the anticipated incremental revenue to be generated from new OEM partnership and distributors, potential partnerships or collaborations with third parties, and the anticipated use of proceeds from the company's public offerings. While these forward looking statements represent management's current beliefs and expectations, they are subject to risks and uncertainties that could cause actual results to differ materially. The company has explained some of these risks and uncertainties in its SEC filings, including the Risk Factors section of its annual report on Form 10 ks. You are cautioned not to place undue reliance on these forward looking statements, which reflect our expectations as of the date of this presentation.

[Operator]

Except as required by law or the NASDAQ listing standards, the company expressly disclaims any intent or obligation to publicly update or revise any forward looking statements. Your host today, Brian Schaffner, Chief Executive Officer and Interim Chief Financial Officer, will present the company's results of operations as of and for the second quarter ended 06/30/2025. A press release detailing these results crossed the wire this afternoon at 04:05PM Eastern Time and is available at investors.xpn360.com. At this time, I will turn the call over to Brian.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

Thank you, Arielle, and good afternoon, everyone. I am pleased to welcome you to today's second quarter twenty twenty five financial results conference call. I'd like to start by giving a brief overview of who we are and what we do. XBEYOND three sixty is focused on creating energy storage solutions for our customers, utilizing our core values of safety through third party testing and UL certification, quality, offering an industry leading twelve year warranty and service, providing customer support for the entire energy storage system purchased from us, not just the XBEYOND three sixty built components. XBEYOND three sixty designs, assembles, and sells lithium iron phosphate or LiPo four batteries and supporting accessories for RV, marine, light electric vehicle, and home energy storage applications.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

We believe that our product offerings include some of the most energy dense and minimal footprint batteries available, and we are deploying multiple intellectual property strategies, advanced research and development capabilities, and innovative products to sustain and scale our business. Our customers include dealers, wholesalers, private label customers, and original equipment manufacturers or OEMs who are driving revenue and brand awareness nationally. And we complement our wholesale channel with direct to consumer sales. Our management team and board members are experienced across engineering, technology, and finance. We believe the combination of these factors positions us to execute our long term growth strategies.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

The second quarter included two of our most successful months of sales in company history, marking our sixth consecutive quarter of sequential revenue growth and sustained momentum. Revenue grew 134% year over year to three million and forty 6% sequentially from the 2025. And if you can't tell, I am proud of the progress we have made and remain excited about our future. Our E360 product line continues to be a preferred conversion solution for lead acid batteries as demonstrated by its strong sales growth. We now have more than 300 customers nationwide and maintain sales relationships with major RV retailers and distributors, including Camping World, KZ Recreational Vehicles, a subsidiary of Thor Industries and Meijer Distributing Inc.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

We continue to work towards additional OEM market penetration with new major partners, including Scout Campers and Alaskan Campers. We believe we have a strong reputation in the lithium battery space, and we can plan to continue leveraging that to broaden our distribution channels. To highlight some of our operational accomplishments and milestones in the second quarter, We have advanced our home energy storage solutions or HESS vertical with shipments beginning in January 2025. We believe the Hess product line will benefit from a fast growing battery energy storage market and consumer update can rapidly scale with the introduction of products like Hess to improve price, flexibility and integration. We are exploring opportunities to expand Hess into the AI data center storage and backup market.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

We are actively pursuing a tariff exclusion request and working with our resources in Washington DC to minimize potential impacts on our business and growth. We implemented both short and long term mitigation strategies, including building six to twelve months of inventory ahead of the tariff changes, reducing our costs in the current battery line and diversifying our supply sources. Longer term, our goal is to onshore manufacturing of key components such as BMS, sales communications and cases, which would reduce tariff exposure and allow us to pursue opportunities in the government and defense space. Our reputation for quality in the recreational and LED markets is the driving force behind our development of home energy solutions, which we expect will be the foundation for our future growth. As mentioned, we pride ourselves on servicing the entire system sold to a customer, not just the battery, and we are also a master Victron distributor.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

We believe we have strategically positioned our battery portfolio across the five markets we serve, each of which I will touch on. The RV market is recovering with healthy momentum driven by interest in outdoor activities and demand for vehicles that depend on batteries to power their systems. Our lithium batteries support RV systems and appliances while replacing noisy generators for off grid power and can be charged by the engine or by solar. Our EDGE battery, which is now commercially available, features a custom form factor incorporating our patent pending innovations and recently developed IP, including VHC heating technology, SmartTalk Bluetooth and CAN bus communications. We began shipping the Edge to customers in the 2024.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

Our solutions are also employed in the marine market to support trolling motors and operating cabin electronics. The third established market we serve is the light electric vehicle market or LEV, such as golf carts, which are undergoing a transition from lead acid to lithium and require the power generation and reliability that our batteries can provide. The fourth and newest market we serve is the home energy storage market, including both home and commercial solar power storage solutions. I'll expand on our opportunity in home energy shortly. Finally, we see the industrial applications market as a future growth vertical for us, driven by demand for additional capabilities for electric forklift and industrial material handling.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

We are building a robust IP portfolio across all five of these markets, and we currently have 11 patents pending. Now, I'll focus on our market expansion within the E360 Home Energy Storage Solutions or Hess. With the introduction of our two LiPo four battery solutions to support home energy storage, we are targeting home and small commercial solar users and installers who are interested in a high performance, modular system with straightforward installation. The company accelerated its home energy development timeline in response to the downturn in RV sales in 2023. Despite increasing our market share during that period, we recognize that home energy represented a critical growth opportunity for our future.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

Of our two existing home energy product options, one has received certification and the other is in final stages of UL approval. A requirement in states such as California that require UL 90 fiveforty certification of the battery and inverter to qualify for tax credits. Battery storage systems offer a way to capture ROI for a consumer outside of a traditional solar system, utilizing the draw of power into the system during off discharge during peak hours. Our solutions provide scalability and versatility across market channels, including solar installers, electrical contractors, residential and commercial builders, and energy service providers. A view of our home energy solutions can be found on our website.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

We think the home energy market provides complementary economics to our business model, with an opportunity to generate recurring revenue streams while enabling margin expansion in a market that is expected to surpass $123,000,000,000 globally by 2029 according to market data forecasts. Supported by incentives such as California's self generation incentive program and federal tax credits available through the inflation reduction act. We are using proceeds from our public offerings to provide necessary funding to further develop our new E360 home energy storage solutions, including finishing our UL testing and certification process in addition to other requirements required for various authorities having jurisdiction. I will now discuss our second quarter twenty twenty five financial results. Revenue in the second quarter totaled $3,000,000 an increase of 134% from $1,300,000 in the prior year period.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

The increase in net sales was primarily attributable to sales growth in the RV market along with accessory sales growth through integrator partners. Gross profit totaled $600,000 or 21% of revenue as compared to $300,000 or 25% of revenue in the prior year period. The decrease in gross margin percentage was primarily attributable to the product mix sold in the different periods. Gross margin was affected by ongoing tariff uncertainty and a higher mix of lower margin pass through product sales. We mitigated some of this impact through early inventory builds, cost reduction in our battery line and supply chain diversification to free trade countries such as South Korea.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

Long term, our strategy includes onshoring manufacturing of key components. Our selling and administrative expenses were $2,000,000 which was flat compared to the prior year period and a decrease as a percentage of sales of 91 percentage points from 157% of sales in the 2024 to just 66% of sales in the 2025. The decrease was primarily due to the reduced cost of rent related expenses and offset by smaller increases in travel expense, research and development and other expenses. Net loss in the second quarter totaled $1,400,000 a 38% improvement over a net loss of $2,200,000 in the prior year period. The decrease in net loss was primarily a result of a higher net sales for the period ending 06/30/2025, combined with our decreases in selling, administrative and general expenses.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

Turning to the first half twenty twenty five results. For six months ended 06/30/2025, net sales totaled $5,000,000 a 124% increase from $2,200,000 in the prior year period. The increase in net sales was primarily attributable to sales growth in the RV market along with accessory sales growth through our integrator partners. Gross profit for the six months ended 06/30/2025 totaled $1,100,000 or 22% as a percentage of sales compared to $500,000 or 24% as a percentage of sales in the prior year period. Again, the decrease in gross margin percentage was primarily attributable to the product mix sold in the different periods.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

Selling, general and administrative expenses for six months ending 06/30/2025 decreased by 14% to $3,600,000 compared to $4,200,000 in the prior year period and decreased as a percentage of sales by 114 percentage points from 186% of sales in the 2024 to just 72% of sales in the 2025. The decrease was primarily due to decreases in salaries, benefit, rent and related expenses, and legal and professional fees were slightly offset by an increase in research and development expenses. Net loss for six months ending 06/30/2025 totaled $2,500,000 a 43% improvement from a net loss of $4,400,000 in the prior year period. The decrease in net loss was primarily a result of higher net sales for the period ended 06/30/2025 combined with decreases in selling, administrative and general expenses. Cash and cash equivalents totaled $700,000 as of 06/30/2025, compared to $500,000 as of 12/31/2024.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

Net cash used in operating activities totaled $1,600,000 for the six months ending 06/30/2025, compared to $3,400,000 in the prior year period. Receiving inventory that was prepaid during the prior period accounted for the majority of the change for the six months ended 06/30/2025. In closing, we remain confident and enthusiastic about 2025 and beyond. With substantial purchase orders already in hand and interest from new customers across our product line, including our next generation GC2, Group 27 and Edge batteries, we look forward to additional milestones in the months ahead. Our focus on safety, quality and service continues to resonate with our more than 300 customers nationwide.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

Operationally, we have undertaken several initiatives to increase margins and reduce costs within the current line of batteries. We continue to work towards additional OEM market penetration by continuing to add features, including enhanced energy density and developing OEM centric form factors to further our market reach. I thank you all for attending. And now, I would like to hand the call over to the operator to open the line for questions.

[Operator]

-Thank you. We will now begin the question and answer session. If at any time your question has been addressed and you would like to withdraw your question, please press star then 2. At this time, we will pause momentarily to assemble our roster. As there are currently no questions from the phone, I would like to turn the question and answer session over to Larry to take questions from the webcast.

[Larry Holub, Director - IR at Expion360]

Our first webcast question asks, current tariff environment and lobbying efforts in Washington, DC, has anything developed?

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

Yeah, that's a good question. Obviously, the tariff finish line, for lack of a better term, continues to be moved on a monthly basis. We do feel confident with our lobbying efforts in DC, and we believe that we have our case for an exclusion or an exception in front of the right people. But right now, we are continuing to benefit from the decisions that we made in September and October and November when we preloaded our inventory for the next year.

[Larry Holub, Director - IR at Expion360]

Our next webcast question asks, how much prebuilt inventory is left for subsequent quarters?

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

It's a considerable amount. I mean, the inventory that you see on our books, which is over $5,000,000 that is available for sale, that represents a majority of what is left on the inventory that we purchased in September and October and November. And so we are looking to actively replace that so that we can head into 2026.

[Larry Holub, Director - IR at Expion360]

And our last webcast question asks, does the China tariff pause help or will you pass price increases to customers or sell at lower margins?

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

I think that for us, for the next quarter, what matters is our sales mix. As I alluded to before, we had some accessory sales that went out at a little lower margin than we normally have on our batteries. And I would tend to think that our battery sales, which is driving our top line, our battery sales is going to help us with a strong margin in the third quarter.

[Operator]

This concludes the question and answer session. I would like to turn the conference back over to Mr. Schaffner for any closing remarks.

[Brian Schaffner, CEO, Interim CFO & Director at Expion360]

Thank you to everyone for attending today's call. And we are excited about where we're headed and looking forward to continuing to engage with our investors throughout the remainder of 2025. Just a note, if you are unable to answer or if we were unable to answer any of your questions, please reach out to our IR firm, MZ Group. They would be more than happy to assist you. This concludes our call.

[Operator]

This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.

Participants

Executives

• Brian Schaffner, CEO, Interim CFO & Director
• Larry Holub, Director - IR