Xos Inc. Plunges 8.2% Despite Revenue Surge

Xos Inc. (XOS) experienced a significant drop of 8.2% in pre-market trading on August 15, 2025, following the release of its Q2 2025 earnings report.

Xos reported its highest quarterly revenue in company history, reaching $18.4 million, driven by the delivery of 135 vehicles. This marked a substantial increase from the previous quarter and exceeded analyst expectations. The company also achieved positive free cash flow for the second time as a public company, reaching $4.6 million.

Despite the strong revenue performance, Xos faced challenges with its gross margin, which declined to 8.8% from 13.1% in the previous year. This decrease was attributed to shifts in product mix and inventory adjustments. The company also raised its projected non-GAAP operating loss range for FY2025 by approximately $10 million due to tariff and product-mix pressures.

Xos reaffirmed its full-year 2025 guidance for revenue between $50.2 million and $65.8 million, and for unit deliveries between 320 and 420 vehicles. However, the company widened its projected non-GAAP operating loss range to reflect higher tariffs and less favorable product mix in the second half of the year.

Looking ahead, Xos is focusing on scaling production efficiently, providing end-to-end electrification solutions, and adapting to cost challenges. The company's ongoing ability to attract large customers and leverage high component commonality across its models are seen as central factors for future growth.