iPower Inc.: Navigating Leadership Shifts with Financial Fortitude—A Compelling Buy at Current Levels

The abrupt departure of a CFO can send shockwaves through even the most resilient companies. Yet, iPower Inc. (IPWR) has demonstrated an ability to thrive amid leadership changes, underscored by its robust Q3 2024 financial performance and strategic initiatives. With a reverse stock split proposal on the horizon and a strengthened board of independent directors, the company is positioned to capitalize on its turnaround momentum. Investors should view current volatility as a buying opportunity ahead of the June 23 annual meeting vote—a catalyst that could unlock significant upside.

Q3 2024: A Testament to Operational Resilience

Despite the CFO's exit earlier this year, iPower delivered 15% year-over-year revenue growth to $23.3 million in Q3 2024, marking a critical inflection point. Gross margins soared to 47%, up 850 basis points from 2023, driven by supplier renegotiations and a focus on high-margin products. Net income turned positive for the first time in years, hitting $1.0 million, while adjusted net income surged to $1.6 million.

These results are not merely a flash in the pan. The company's SuperSuite supply chain business, now contributing 10% of revenue, has become a growth engine. Meanwhile, new sales channels like Temu (launched in early 2024) and plans to expand into Southeast Asia and the U.S. manufacturing base signal a deliberate shift toward long-term resilience.

The Reverse Stock Split: A Strategic Necessity

The proposed reverse stock split—a vote on which will occur at the June 23 annual meeting—is a critical defensive move. By consolidating shares, iPower aims to maintain its Nasdaq listing, which is under pressure due to its current low stock price. The split ratio (1-for-2 to 1-for-25) will be determined by the board, providing flexibility to address market conditions.

Critically, the proposal requires only a simple majority vote. With management's recent financial discipline and the board's focus on shareholder value, the split's approval is likely—and its success could catalyze a rebound in investor sentiment.

Governance Strength: Mitigating Leadership Risks

The board's independence and expertise are central to iPower's ability to navigate leadership transitions. Yue Guo, newly appointed as an independent director, chairs the Nominating and Corporate Governance Committee and serves on audit and compensation committees. His experience at Amazon Web Services and JD Cloud brings tech-sector rigor to iPower's supply chain and e-commerce strategies.

The board's restructuring—following the May 2025 resignations of directors Kevin Liles and Kevin Vassily—has strengthened oversight. Independent directors now control key committees, ensuring accountability and alignment with shareholder interests. This governance overhaul aligns with Nasdaq requirements and signals a commitment to long-term value over short-term pressures.

Undervalued Amid Transition

iPower's stock trades at a forward price-to-earnings ratio of just 8x, far below peers in e-commerce and supply chain solutions. This discounts the company's margin expansion, debt reduction (net debt cut by 59% since mid-2023), and strategic pivot away from legacy businesses like hydroponics. The market's skepticism likely overweights near-term risks, such as the CFO departure and Q3 2025's temporary revenue dip (down 29% year-over-year), while underestimating the SuperSuite's scalability and cost discipline.

Catalysts for a Turnaround

• June 23 Annual Meeting: Approval of the reverse split will remove delisting risk and could lift the stock price.
• Q3 2025 Earnings Recovery: While revenue dipped due to partner-related headwinds, operating expenses fell 15% year-over-year, proving cost controls are intact. Management's focus on Temu and TikTok Shop expansion may stabilize sales.
• Supply Chain Diversification: U.S. manufacturing and Southeast Asia partnerships aim to reduce regional risk, a priority for investors in volatile global markets.

Risks to Consider

• Dependency on Key Partners: The largest channel partner still drives significant revenue. Diversification into Temu and Tmall is essential.
• Market Sentiment: Negative investor reaction to leadership changes or regulatory scrutiny could delay recovery.

Conclusion: A Buy at Current Levels

iPower Inc. has emerged from its leadership turbulence with strong fundamentals, disciplined governance, and a clear path to sustained growth. The reverse stock split vote is a binary event that could redefine the stock's trajectory. With a compelling valuation and strategic execution in place, the time to act is now—buy IPWR before the June 23 meeting.

The road ahead is not without potholes, but iPower's financial fortitude and adaptive leadership make it a compelling bet for investors willing to look past near-term noise.