iPower Inc.: Navigating Near-Term Headwinds to Unlock Long-Term Value

Is iPower’s Stock Pricing in a Turnaround Opportunity?

The Q3 2025 earnings report from iPower Inc. revealed a stark 29% year-over-year revenue decline, dropping to $16.6 million. While this paints a challenging near-term picture, the story is far from over. Beneath the headline numbers lies a strategic transformation that could position the company for sustained growth. Let’s dissect the risks and rewards of investing in iPower today.

The Revenue Decline: A Temporary Setback or Structural Weakness?

The revenue slump stems from reduced orders from iPower’s largest channel partner, which had inflated purchases in the prior year to stockpile inventory. This “demand normalization” is a transient issue, not a sign of structural weakness. Historical data shows this partner’s elevated buying in Q3 2024 (when revenue surged 15% to $23.3 million) was an outlier.

The critical question: Can iPower reduce its reliance on this single partner? The answer lies in its SuperSuite supply chain services, which now account for 20% of total revenue (up from 10% in 2024). This segment’s rapid growth signals a successful diversification effort.

Defensive Strengths: Debt Reduction and Margin Stability

While revenue dipped, iPower’s operational discipline shines through:
- Total debt fell 43% to $3.6 million, easing liquidity pressures.
- Operating expenses dropped 15% year-over-year, reflecting cost-cutting in general/administrative functions and fulfillment costs tied to the major partner.

The company’s gross margin dipped slightly to 43.3% (from 44.5% in 2024) due to SuperSuite’s lower margins. However, this is a calculated trade-off: SuperSuite’s scalability and recurring revenue model position it to boost margins long-term.

SuperSuite: The 20% Revenue Lever for Growth

SuperSuite’s contribution to revenue has doubled in one year, and its pipeline of prospective partners is robust. This end-to-end supply chain platform offers iPower two critical advantages:
1. Higher recurring revenue: Unlike one-time product sales, SuperSuite contracts provide steady cash flows.
2. Margin expansion potential: As SuperSuite scales, its infrastructure costs will spread over more customers, lifting margins.

Management’s focus on supply chain diversification (e.g., expanding U.S. manufacturing and forging relationships with alternative suppliers) further reduces external volatility. This strategy insulates iPower from geopolitical or logistical disruptions, a key competitive edge in an unstable market.

Valuation Inflection Point: When Does Cash Burn Turn to Profitability?

The cash burn is a red flag: cash reserves fell to $2.2 million, down from $7.4 million in mid-2024. However, three factors mitigate this risk:
1. Cost discipline: Operating expenses are now 15% lower, and debt is manageable.
2. SuperSuite’s growth trajectory: At 20% of revenue and climbing, this segment could hit 30%+ within two years, driving breakeven or profit.
3. Strategic divestments: Winding down the legacy hydroponics business reduces drag on resources.

Assuming SuperSuite grows at 50% annually, iPower could achieve positive net income by early 2026. The stock’s current valuation—trading at just 4x forward EBITDA estimates—suggests the market has already discounted near-term pain.

Conclusion: A Compelling Risk-Adjusted Opportunity

iPower faces clear near-term challenges: revenue volatility tied to a single partner and cash burn pressures. Yet its strategic moves—debt reduction, cost control, SuperSuite scaling, and supply chain resilience—are all value-creating levers.

The stock’s current price likely reflects short-term concerns, but the long-term thesis is strong. Investors who can tolerate short-term turbulence may find iPower a compelling play on supply chain innovation and recurring revenue models.

Action to Take:
- Buy: For investors with a 12–18-month horizon, iPower offers asymmetric upside if SuperSuite meets its growth targets.
- Wait: Hold off if cash burn remains elevated beyond Q4 2025.

The question isn’t whether iPower can recover—it’s whether the market will recognize the progress soon enough. For now, the data suggests a turnaround is in motion.

Invest wisely, but act decisively.