Workhorse Group ((WKHS)) has held its Q4 earnings call. Read on for the main highlights of the call.
In the latest earnings call, Workhorse Group presented a balanced sentiment, highlighting both significant achievements and ongoing challenges. The company has made progress in product development and cost reduction, yet it continues to face hurdles with declining revenue and uncertainties in the EV market impacting adoption rates.
Positive Customer Reception and New Orders
Workhorse’s introduction of the new W56 208-inch wheelbase truck was met with positive customer reception, evidenced by a purchase order for 13 step vans, with deliveries expected to commence in Q2 2025. Additionally, the company received approval for the sale of its W750 and W56 step van models in Canada, marking a significant milestone in expanding its market reach.
Operational Cost Reductions
The company achieved substantial reductions in operational costs, with SG&A expenses lowered by $13.1 million and R&D expenses reduced by $15.3 million compared to 2023. These savings were primarily due to significant cuts in headcount and other spending activities, showcasing Workhorse’s commitment to financial efficiency.
Strong Product Performance
The W56 model demonstrated impressive performance, achieving uptime rates of 93% to 97% and exceeding a range of 150 miles under challenging conditions. This strong real-world performance underscores the reliability and efficiency of Workhorse’s latest offerings.
Revenue Decline
Despite positive developments, Workhorse experienced a decline in sales, with revenue net of returns and allowances dropping to $6.6 million for 2024, down from $13.1 million in 2023. This decrease was primarily due to lower sales of the W4 CC truck, highlighting ongoing financial challenges.
Significant Net Loss
Workhorse reported a net loss of $101.8 million for the full year 2024, a slight improvement from the $123.9 million loss in 2023. While this indicates some progress, the financial challenges remain significant for the company.
Uncertain EV Market Adoption
The company faces uncertainties in the EV market, with regulatory delays, shifting incentives, and other external factors slowing the pace of EV adoption. These challenges have impacted Workhorse’s ability to secure large-scale orders, posing a risk to future growth.
Forward-Looking Guidance
Looking ahead, Workhorse Group remains focused on advancing its product roadmap and securing orders for its commercial electric vehicles. Despite a net loss of $101.8 million, the company has implemented significant cost-saving measures and maintains $4.6 million in cash and $41.8 million in inventory. Workhorse is committed to navigating the challenges in the EV market while extending its financial runway.
In summary, Workhorse Group’s earnings call reflected a balanced sentiment, with notable achievements in product development and cost reduction juxtaposed against ongoing challenges in revenue and market adoption. The company’s focus on operational efficiency and product performance provides a foundation for future growth, despite the uncertainties in the EV landscape.