Workhorse Group ((WKHS)) has held its Q3 earnings call. Read on for the main highlights of the call.
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The recent earnings call of Workhorse Group presented a balanced perspective, highlighting significant strides in product development and financial discipline, while also addressing challenges such as decreased sales and increased costs. The proposed merger with Motiv Electric Trucks was a focal point, seen as a strategic move to bolster growth and financial stability.
Product Roadmap and Sales Expansion
Workhorse Group has successfully completed the sale of 15 trucks in the Class 4 and 5/6 categories. The company has expanded its product portfolio and maintained robust operating performance, receiving positive feedback from customers for the W56 platform. This expansion is a testament to the company’s commitment to innovation and customer satisfaction.
Financial Discipline and Cost Reduction
The company demonstrated strong financial discipline by reducing operating expenses by $1.2 million year-over-year. This reduction was achieved through disciplined cost management and continued efforts to decrease operating and overhead costs, reflecting Workhorse’s focus on financial efficiency.
Proposed Merger with Motiv
Workhorse announced a definitive agreement to merge with Motiv Electric Trucks. This strategic move aims to accelerate growth and expand the product lineup, offering potential benefits for shareholders. The merger is expected to enhance Workhorse’s competitive position in the electric vehicle market.
W56 Step Van Performance
The W56 step vans have shown impressive performance, operating at 97% or greater uptime availability. These vans are also eligible for California HVIP vouchers of $85,000 per truck, which could provide significant financial incentives for customers and boost sales.
Improved Financial Position
Workhorse Group reported a reduction in net loss to $7.8 million from $25.1 million year-over-year. The company’s cash and cash equivalents increased significantly to $38.2 million from $4.6 million in the same period last year, indicating a stronger financial footing.
Decreased Sales and Increased Costs
The company faced a decrease in sales by $100,000 due to lower truck deliveries. Additionally, the cost of sales increased by $3.5 million, attributed to inventory excess and obsolescence reserves, highlighting areas needing attention.
Increased SG&A Expenses
SG&A expenses rose by $100,000, primarily due to a $3.6 million increase in consulting and legal expenses related to the proposed Motiv merger. This increase underscores the financial implications of strategic transactions.
R&D Spending Reduction
Workhorse reduced its R&D expenses by $1.2 million, achieved through a reduction in headcount and decreased spending on prototype parts and consulting services. This reduction aligns with the company’s focus on cost management.
Forward-Looking Guidance
Looking ahead, Workhorse Group provided several key financial and operational metrics for the quarter ending September 30, 2025. The company reported sales of $2.4 million, slightly down from the previous year, with a net loss of $7.8 million compared to $25.1 million in Q3 2024. The proposed merger with Motiv Electric Trucks and recent financial transactions are expected to strengthen the company’s financial position and support future growth.
In conclusion, Workhorse Group’s earnings call reflected a balanced sentiment, with notable advancements in product development and financial management. Despite challenges such as decreased sales and increased costs, the proposed merger with Motiv and improved financial position signal a positive outlook. The company’s strategic initiatives and disciplined approach suggest potential for future growth and stability.