Fly-E Group Reports Revenue Decline and Net Loss for Q3 and Nine Months Ended December 31, 2024

Fly-E Group, Inc. reported a significant decline in financial performance for the three and nine months ended December 31, 2024, compared to the same periods in 2023. The company generated revenues of $5.7 million for the third quarter, a decrease of 23.6% from $7.4 million in the prior year. For the nine-month period, revenues fell by 15.2% to $20.4 million from $24.0 million. The decline in revenue was attributed primarily to a decrease in sales volume, with total units sold dropping from 13,500 to 9,989 in the third quarter and from 49,503 to 41,925 in the nine-month period. The company also reported a net loss of $684,487 for the third quarter, a stark contrast to a net income of $20,889 in the same quarter of 2023, and a net loss of $2.0 million for the nine months, compared to a profit of $1.2 million in the previous year.

Operationally, Fly-E Group has made strategic changes, including the launch of a rental service for e-bikes in New York City and Los Angeles, which began in October 2024. This initiative aims to meet increasing market demand for safe, certified e-bikes. The company has also expanded its retail presence, operating 36 stores as of February 19, 2025, including 35 in the U.S. and one in Canada. However, the company closed four stores during the nine-month period, reflecting a strategic shift in its retail operations. The company’s employee headcount has increased, with payroll expenses rising to $1.3 million for the third quarter, up from $0.7 million in the same period last year.

The company’s balance sheet showed total assets of $37.2 million as of December 31, 2024, up from $29.0 million at the end of the previous fiscal period. Current assets increased significantly, driven by a rise in inventories, which reached $8.6 million, compared to $5.4 million in March 2024. This increase in inventory is linked to preparations for the new rental business. However, the company also reported a substantial increase in liabilities, with total liabilities rising to $24.1 million from $22.2 million, primarily due to short-term loan payables.

Looking ahead, Fly-E Group faces challenges related to its financial health, as management has expressed substantial doubt about the company's ability to continue as a going concern. The company plans to address this through equity financing and other available sources of funding. The management's outlook emphasizes the need for effective marketing strategies to attract new customers and improve sales, particularly in light of recent declines attributed to safety concerns surrounding lithium batteries used in e-bikes. The company is also focused on enhancing its product offerings and expanding its market presence, with plans to enter new geographic markets in South America and Europe in the future.