Expion360 Inc. reported its financial results for the third quarter and nine months ended September 30, 2024, revealing significant challenges in revenue generation and profitability compared to the previous fiscal period. The company recorded net sales of $1.39 million for the third quarter, a decrease of 26.5% from $1.89 million in the same quarter of 2023. For the nine-month period, net sales totaled $3.64 million, down 29.0% from $5.12 million in the prior year. The decline in sales is attributed to a downturn in the RV market and customers limiting orders in anticipation of new product availability.

Gross profit for the third quarter was $169,000, representing 12.1% of sales, a sharp decline from 25.0% in the same quarter of 2023. For the nine months, gross profit was $717,000, or 19.7% of sales, down from 26.8% in the previous year. The decrease in gross profit is linked to lower sales volumes and higher fixed overhead costs per unit, compounded by increased costs from the liquidation of non-core products.

The company reported a net loss of $8.81 million for the third quarter, compared to a loss of $1.81 million in the same period of 2023. For the nine months, the net loss was $13.23 million, up from $5.27 million in the prior year. The increase in losses was driven by a significant change in the fair value of warrants and higher interest expenses, which rose to $468,000 from $27,000 in the same quarter of 2023.

Total current assets increased to $8.77 million as of September 30, 2024, from $8.27 million at the end of 2023, while total assets decreased to $10.13 million from $11.91 million. Current liabilities rose sharply to $6.77 million, up from $4.02 million, contributing to an overall increase in total liabilities to $7.58 million.

In terms of strategic developments, Expion360 executed a 1-for-100 reverse stock split effective October 8, 2024, aimed at regaining compliance with Nasdaq listing requirements. The company also raised approximately $8.7 million in net proceeds from a public offering in August 2024, selling 33.4 million Common Units and 16.6 million Pre-Funded Units. This capital infusion is intended to address ongoing cash flow challenges and support operational expenses.

Management has expressed concerns about the company's ability to continue as a going concern, citing recurring losses and negative cash flows from operations. The company is actively seeking additional capital and managing inventory levels to navigate these financial difficulties.