Polar Power Reports Q1 2025 Financial Results with Decrease in Net Sales but Improved Profitability

Polar Power, Inc. reported its financial results for the first quarter of 2025, revealing a net sales figure of $1.723 million, a decrease of 3% from $1.775 million in the same period of 2024. The company experienced a significant reduction in its net loss, which narrowed to $1.265 million, or $(0.50) per share, compared to a net loss of $2.142 million, or $(0.85) per share, in the prior year. This improvement in profitability was attributed to a 36% reduction in the cost of sales, which fell to $1.403 million from $2.177 million, leading to a gross profit of $320,000, a substantial turnaround from a gross loss of $402,000 in the previous year.

In terms of operational metrics, Polar Power's customer base remains heavily concentrated, with its two largest customers accounting for 71% and 17% of total sales in the first quarter of 2025, compared to 49% and 25% in the same period of 2024. The telecommunications sector continues to dominate, representing 82% of net sales, up from 65% in the prior year. International sales also saw a notable increase, contributing 18% of total sales compared to just 6% in the first quarter of 2024. The company reported a backlog of $2.238 million, primarily from telecommunications customers, indicating future revenue potential.

Strategically, Polar Power has focused on diversifying its product offerings and customer base. The company launched new prime power DC generators optimized for propane and natural gas, responding to increasing regulatory pressures on diesel engines. Additionally, Polar Power is expanding its mobile electric vehicle (EV) charging solutions, having tested a new model that adheres to universal charging standards. The company plans to enhance its sales and marketing efforts in 2025, including hiring additional staff to support its growth initiatives.

Despite the positive developments, Polar Power faces challenges, including excess inventory at customer warehouses and broader economic and geopolitical factors affecting purchasing decisions. The company reported a decrease in cash and cash equivalents to $68,000 as of March 31, 2025, down from $498,000 at the end of 2024. The company continues to rely on its credit facility with Pinnacle Bank, with an outstanding balance of $4.788 million as of the end of the quarter. Looking ahead, Polar Power aims to improve operational efficiency and reduce costs while navigating the complexities of the current market environment.