Ondas' Q1 2025: Unraveling Tariff Impacts, Revenue Visibility, and Growth Strategies

Tariff impact on supply chain, revenue visibility and order recognition, growth and market strategy, follow-on orders and expansion opportunities, and pricing and margin expectations are the key contradictions discussed in Ondas' latest 2025Q1 earnings call.



Revenue and Business Growth:
- Ondas entered 2025 with strong momentum, generating $4.2 million in Q1 revenue. They had a backlog of $16.8 million, up from $10 million at the beginning of the year.
- The growth was driven by the execution of existing orders and securing new orders, particularly in their Ondas Autonomous Systems (OAS) segment, which accounted for over $4 million in revenues.

Ondas Autonomous Systems (OAS) Expansion:
- OAS achieved a significant increase in revenues, over 600% from Q1 2024 to Q1 2025, with over $4 million in Q1 2025.
- This expansion is attributed to new programs with military customers and the continued deployment in the UAE under the DroneBox program.

Dot16 Standard Adoption:
- The Association of American Railroads selected dot16 as the communications protocol standard for the Next Generation Head-of-Train/End-of-Train (NGHE) system.
- This decision validates Ondas's strategic efforts and positions them for commercial adoption across various frequency bands.

Financial Performance Improvement:
- The company reported a 35% gross margin in Q1 2025, compared to a gross loss of $0.4 million in Q1 2024.
- The improvement in gross margins is attributed to increased higher-margin product revenues from OAS, despite still being in the early stages of platform adoption.