Fly-E Group, Inc. reported significant financial challenges in its latest 10-Q filing for the quarter ending September 30, 2024. The company experienced a 22.1% decline in revenues, totaling $6.8 million compared to $8.8 million in the same quarter of 2023. This decrease was attributed to a drop in total units sold, which fell from 20,906 to 15,056. For the six-month period, revenues also decreased by 11.5%, from $16.6 million in 2023 to $14.7 million in 2024.
The company's gross profit for the third quarter was $2.9 million, down 22.8% from $3.8 million in the prior year, while total operating expenses surged by 54.5% to $4.1 million, leading to a loss from operations of $1.2 million, a stark contrast to the income of $1.1 million reported in Q3 2023. The net loss for the quarter was approximately $1.1 million, compared to a net income of $746,556 in the same period last year.
Fly-E Group's financial position showed a notable increase in total current assets, which rose to $13.2 million from $8.1 million as of March 31, 2024. However, total current liabilities also increased to $10.9 million from $7.8 million, resulting in a total stockholders' equity of $13.8 million, up from $6.8 million.
The company’s cash position decreased slightly to $1.3 million from $1.4 million at the end of the previous fiscal period. Notably, the company reported net cash used in operating activities of approximately $9.4 million for the six months ended September 30, 2024, compared to a positive cash flow of $1.6 million for the same period in 2023.
Fly-E Group's strategic developments included the completion of its initial public offering (IPO) on June 7, 2024, raising approximately $9.2 million in net proceeds. The company also launched a new rental program for UL-certified e-bikes in October 2024, with plans for expansion into major cities.
Despite these efforts, the company faces substantial doubt regarding its ability to continue as a going concern, primarily due to ongoing losses and significant cash outflows. Management is exploring equity financing and other financial support to mitigate these risks. Additionally, the company received a notice from Nasdaq regarding non-compliance with the minimum bid price requirement, which it must address by March 31, 2025.
About Fly-E Group, Inc.
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