Fly-E Group, Inc. SEC 10-K Report

Fly-E Group, Inc., a leading provider of urban mobility solutions specializing in electric motorcycles, bikes, and scooters, has released its annual 10-K report. The report provides a comprehensive overview of the company's financial performance, business operations, strategic initiatives, and the challenges it faces in the rapidly evolving electric vehicle (EV) industry.

Financial Highlights

Revenues, Net: $25.4 million, a decrease of 21.0% from $32.2 million for the year ended March 31, 2024, primarily driven by a decrease in sales volume due to lithium-battery accidents.

Gross Profit: $10.5 million, a decrease of 20.3% from $13.1 million for the year ended March 31, 2024, with a gross margin of 41.1% compared to 40.7% in the previous year.

(Loss) Income from Operations: $(4.6) million, a decrease from $3.3 million for the year ended March 31, 2024, due to increased operating expenses.

Net (Loss) Income: $(5.3) million, a change of $7.2 million from net income of $1.9 million for the year ended March 31, 2024, mainly attributable to decreased revenue and increased expenses.

EBITDA: $(3.9) million, a change of $7.4 million from $3.5 million for the year ended March 31, 2024, reflecting decreased revenue and increased selling and administrative expenses.

Business Highlights

Revenue Segments: Fly-E Group, Inc. generates revenue from three main product lines: E-motorcycles, E-bikes, and E-scooters. The company also offers rental services in select locations, contributing to its revenue streams.

Geographical Performance: The company operates 19 retail stores in the U.S. and one in Canada, with plans to expand into South America and Europe. The U.S. market, particularly New York City, is a significant contributor to the company's sales, especially among food delivery workers.

Sales Units: For the year ended March 31, 2025, Fly-E Group produced 4,595 E-motorcycles, 5,974 E-bikes, and 1,557 E-scooters. The company experienced a decrease in sales volume by 10,846 units compared to the previous year.

New Product Launches: The company is developing the Fly E-Bike app to enhance customer experience, which will include features like GPS, navigation, and battery management. A testing version has been launched, with full functionality expected in the future.

Future Outlook: Fly-E Group plans to expand its sales network internationally, targeting markets in South America and Europe. The company also aims to enhance its brand recognition and continue innovating its product line to maintain its competitive edge.

Strategic Initiatives

Strategic Initiatives: The company is expanding its business into South America and Europe, and is developing a Fly E-Bike app to enhance customer experience. It has also engaged DF Technology US Inc for the development of an ERP system and a mobile app for rental services, with significant investments in these technologies.

Capital Management: The company completed an IPO, raising approximately $9.0 million, and a secondary public offering, raising $6.9 million. It also implemented a 1-for-5 reverse stock split to reduce the number of outstanding shares. The company has a current portion of contractual obligations amounting to $8.9 million and is managing its liquidity through equity financing, bank loans, and support from related parties.

Future Outlook: The company plans to alleviate going concern risks through equity financing, debt from banks and financial institutions, and financial support from related parties. It aims to continue expanding its sales network and retail channels, and to enhance its brand through increased marketing efforts. The company is also exploring opportunities for domestic production in response to potential tariff impacts.

Challenges and Risks

Production and Delivery Risks: The ability to meet growing production and delivery plans is uncertain, with potential disruptions from supply chain issues and rising material costs.

Vendor Dependence: Heavy reliance on a limited number of vendors in China for vehicle components could lead to production delays if these vendors fail to deliver on time or at acceptable quality levels.

Trade Tensions: Ongoing trade tensions, particularly between the U.S. and China, may adversely affect the supply chain and increase costs due to tariffs and trade restrictions.

Regulatory Environment: The company operates in a complex regulatory environment that is subject to rapid changes, which could increase compliance costs and operational challenges.

Financial Viability: There is substantial doubt about the company's ability to continue as a going concern, with significant financial losses and cash flow challenges reported.

Internal Controls: Material weaknesses in internal controls over financial reporting have been identified, which could affect the accuracy of financial statements and investor confidence.

Market Competition: The EV market is highly competitive, with many established and new entrants, which could impact the company's market share and pricing strategies.

Cybersecurity Threats: The company is vulnerable to cybersecurity threats that could compromise systems and data, potentially leading to financial and reputational damage.

SEC Filing: Fly-E Group, Inc. [ FLYE ] - 10-K - Jul. 15, 2025