Dragonfly Energy's Q2 2025: Navigating Tariffs and EBITDA Expectations Amid Contradictions

Revenue impact of tariffs, EBITDA break-even timeline, EBITDA profitability expectations, tariff impact and mitigation strategies, and revenue growth expectations are the key contradictions discussed in Dragonfly Energy Holdings Corp.'s latest 2025Q2 earnings call.



Revenue Growth and OEM Partnerships:
- Dragonfly Energy reported a 23% increase in net sales to $16.2 million in Q2, marking the third consecutive quarter of year-over-year revenue growth.
- The growth was driven by an over 50% increase in OEM net sales, reflecting the integration of Dragonfly's solutions at the factory level across multiple model lineups, and a shift in the industry towards premium features.

Operational Efficiency and Margin Improvement:
- Gross profit rose 45.4% to $4.6 million in Q2, with an impressive 430 basis points expansion in gross margin to 28.3%.
- These improvements were driven by lower inventory costs and higher absorption of fixed costs due to increased volume, highlighting the leverage in Dragonfly's manufacturing capabilities.

Innovation and Intellectual Property Expansion:
- Dragonfly Energy was granted a patent advancing its nonflammable all solid-state battery program, enhancing safety, thermal stability, and scalability.
- The patent reinforces Dragonfly's leadership in advanced battery technology and creates a strategic advantage for future growth.

Capital Structure Optimization and Financial Flexibility:
- Dragonfly completed a public offering of common stock in July, raising $5.5 million, and exchanged remaining preferred shares for common stock, simplifying its capital structure.
- These strategic initiatives improve financial flexibility, support expansion into adjacent markets, and reduce associated interest payments and dilution.