# NeoVolta Inc.: Form 10-Q for the period ended Mar 31, 2025

- Company: [NeoVolta Inc.](/companies/neov.md) (CIK 1748137)
- Form: 10-Q
- Filed: 2025-05-09
- Accepted by EDGAR: May 9, 2025, 16:30 ET
- Period: 2025-03-31
- Accession: 0001683168-25-003355
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/1748137/000168316825003355/neovolta_i10q-033125.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1748137/000168316825003355/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2025-03-31.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2025-01-01 to 2025-03-31 | $2.0m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Revenue | 9 months, 2024-07-01 to 2025-03-31 | $3.7m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Cost of revenue | 3 months, 2025-01-01 to 2025-03-31 | $1.5m | us-gaap:CostOfGoodsAndServicesSold |
| Cost of revenue | 9 months, 2024-07-01 to 2025-03-31 | $2.7m | us-gaap:CostOfGoodsAndServicesSold |
| Gross profit | 3 months, 2025-01-01 to 2025-03-31 | $514.5k | us-gaap:GrossProfit |
| Gross profit | 9 months, 2024-07-01 to 2025-03-31 | $931.3k | us-gaap:GrossProfit |
| Research and development | 3 months, 2025-01-01 to 2025-03-31 | $27.9k | us-gaap:ResearchAndDevelopmentExpense |
| Research and development | 9 months, 2024-07-01 to 2025-03-31 | $78.9k | us-gaap:ResearchAndDevelopmentExpense |
| Operating income | 3 months, 2025-01-01 to 2025-03-31 | −$1.4m | us-gaap:OperatingIncomeLoss |
| Operating income | 9 months, 2024-07-01 to 2025-03-31 | −$3.3m | us-gaap:OperatingIncomeLoss |
| Interest expense | 3 months, 2025-01-01 to 2025-03-31 | $78.5k | us-gaap:InterestExpenseNonoperating |
| Interest expense | 9 months, 2024-07-01 to 2025-03-31 | $103.0k | us-gaap:InterestExpenseNonoperating |
| Net income | 3 months, 2025-01-01 to 2025-03-31 | −$1.4m | us-gaap:NetIncomeLoss |
| Net income | 9 months, 2024-07-01 to 2025-03-31 | −$3.4m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2025-01-01 to 2025-03-31 | −$0.04 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 9 months, 2024-07-01 to 2025-03-31 | −$0.10 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2025-01-01 to 2025-03-31 | −$0.04 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 9 months, 2024-07-01 to 2025-03-31 | −$0.10 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2025-01-01 to 2025-03-31 | 33,640,829 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 9 months, 2024-07-01 to 2025-03-31 | 33,412,117 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 9 months, 2024-07-01 to 2025-03-31 | −$3.5m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Cash and equivalents | at 2025-03-31 | $536.0k | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2025-03-31 | $5.7m | us-gaap:AssetsCurrent |
| Total assets | at 2025-03-31 | $5.7m | us-gaap:Assets |
| Current liabilities | at 2025-03-31 | $1.5m | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2025-03-31 | $1.9m | us-gaap:Liabilities |
| Short-term borrowings | at 2025-03-31 | $1.4m | us-gaap:ShortTermBorrowings |
| Shareholders' equity | at 2025-03-31 | $3.8m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 16,522 characters.

### Introduction

This information should be read in conjunction with the interim unaudited financial statements and the notes thereto included in this Quarterly Report on Form 10-Q, and the audited financial statements and notes thereto and “Part II. Other Information - Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations”, contained in our Annual Report on Form 10-K for the year ended June 30, 2024, filed with the Securities and Exchange Commission on September 27, 2024 (the “Annual Report”).

Certain capitalized terms used below and otherwise defined below, have the meanings given to such terms in the footnotes to our unaudited financial statements included above under “Part I - Financial Information” - “Item 1. Financial Statements”.

Unless the context requires otherwise, references to the “Company,” “we,” “us,” “our,” “NEOV”, refer specifically to NeoVolta, Inc.

In addition, unless the context otherwise requires and for the purposes of this Report only:

- “Exchange Act” refers to the Securities Exchange Act of 1934, as amended;
- “SEC” or the “Commission” refers to the United States Securities and Exchange Commission; and
- “Securities Act” refers to the Securities Act of 1933, as amended.

### Overview

We are a designer, manufacturer, and seller of high-end Energy Storage Systems (or ESS), primarily our NeoVolta NV14, NV14-K, and NV-24, which can store and use energy via batteries and an inverter at residential or commercial sites. We were founded to identify new ways to leverage emerging technologies with the dynamic changes that are taking place in the energy delivery space. We primarily market and sell our products directly to our certified solar installers and solar equipment distributors. We are also pursuing agreements with residential developers, commercial developers, and other commercial opportunities. Because we are purely dedicated to energy solar systems, virtually all our current resources and efforts go into further developing our flagship NV14, NV14-K, and NV-24 products, while focusing on specific industry needs for our next generation of products. We believe we are unique in the marketplace due to our low cost, our innovative battery chemistry, our product versatility and our commitment to installer service. Because of these factors, we believe NeoVolta is uniquely equipped to establish itself as a major player in the energy storage market.

In May 2019, we completed a public offering of 3,500,000 shares of our common stock at an offering price of $1.00 per share for gross proceeds of $3.5 million pursuant to Regulation A of the Securities Act. We used the proceeds of the offering to ramp up production, marketing, and sales of our NV14 product line. In that regard, we have used the proceeds from the offering to fund the marketing, production and distribution of our products, which commenced in July 2019 through a group of wholesale customers in California, as well as to provide additional working capital for other corporate purposes. We have expanded to include one wholesale distribution customer in Nevada. As of the current date, we have had successful installations of our products in the additional States of Arizona, Utah, Colorado, Wyoming, Texas, Oklahoma, Missouri, Tennessee, Alabama, Georgia, Florida, and Puerto Rico.

As further discussed below under “Liquidity and Capital Resources,” we completed an underwritten public offering of our equity securities in the form of Units in August 2022. We sold a total of 1,121,250 Units in the offering at an offering price to the public of $4.00 per Unit. The gross proceeds of the offering were $4,485,000 and the net proceeds, after deduction of underwriting discounts and other offering costs, were approximately $3,780,000. We have used the proceeds of this public offering to increase our current production capacity, expand our product portfolio, enlarge our product marketing and sales efforts, and for other general corporate purposes.

On April 14, 2023, California implemented Net Energy Metering 3 (NEM3) for subsequent new solar installations. NEM3 reduces the amount of NEM credit for each kilowatt (KW) of solar power sent to the utility from a rate of approximately $0.20 per KW to $0.09 per KW (each Utility varies). NEM3 effectively increases the average solar Return of Investment (ROI) from 5-6 years to 10-12 years (each Utility varies). Effectively, the Company believes that solar installation in California currently makes little financial sense without also including a complimentary battery system such as ours. We believe that the anticipation of the passage of NEM3 in California, as well as the timing of its post-effective implementation, has had an erratic and temporary impact on the sales of our products in that state, beginning in December 2022.

### Results of Operations

The following discussion reflects the Company’s revenues and expenses for the three-month and nine-month periods ended March 31, 2025 and 2024, as reported in our financial statements included in Item 1.

#### Three months ended March 31, 2025 versus three months ended March 31, 2024

*Revenues* - Revenues from contracts with customers for the three months ended March 31, 2025 were $2,014,105 compared to $283,900 for the three months ended March 31, 2024. Such increase in our revenues, to the highest quarterly level in the history of our Company, was primarily due to the impact of opening various new sales channels since the engagement of our new chief executive officer in April 2024.

*Cost of Goods Sold* - Cost of goods sold for the three months ended March 31, 2025 were $1,499,597 compared to $117,755 for the three months ended March 31, 2024. The cost of goods sold in both periods reflected the cost of procuring and assembling the component parts of the energy storage systems that were sold in each fiscal year and resulted in gross profits on such sales of approximately 26% and 58%, respectively, with the unusually high percentage in the prior year being due to the initial efficiencies that we realized from taking over responsibility for manufacturing of our products from a prior contract operator.

*General and Administrative Expense* - General and administrative expenses for the three months ended March 31, 2025 were $1,857,531 compared to $756,118 for the three months ended March 31, 2024. Such increase was mainly due to our engagement of a new chief executive officer, who was engaged at an annual salary of $350,000 and also received a 4 year amortizing equity award of $2,854,000, as well as the hiring of several other employees since April 2024. The addition of these personnel has resulted in a higher level of both cash compensation expense and other associated expenses, such as marketing and travel, as well as non-cash stock compensation expenses related to the Company’s equity incentive programs.

*Research and Development Expense* - Research and development expenses for the three months ended March 31, 2025 were $27,947 compared to $10,392 for the three months ended March 31, 2024. Such fluctuation was largely due to timing differences in the level of the Company’s recent product development efforts.

*Other Income and Expense* - Interest expense for the three months ended March 31, 2025 was $78,499 compared to zero for the three months ended March 31, 2024, reflecting interest attributable to borrowings made under our line of credit and another borrowing arrangement obtained since June 30, 2024. Interest income for the three months ended March 31, 2025 was $138 compared to $10,892 for the three months ended March 31, 2024. This decrease was due to our lower level of investable cash in the three months ended March 31, 2025.

*Net Loss* - Net loss for the three months ended March 31, 2025 was $1,449,331 compared to $589,473 for the three months ended March 31, 2024, representing the aggregate of the various revenue and expense categories indicated above. The Company has not recognized any income tax benefit for these net losses due to the uncertainty of its ultimate realization.

#### Nine months ended March 31, 2025 versus nine months ended March 31, 2024

*Revenues* - Revenues from contracts with customers for the nine months ended March 31, 2025 were $3,675,922 compared to $2,065,858 for the nine months ended March 31, 2024. Such increase in our revenues was primarily due to the impact of opening various new sales channels since the engagement of our new chief executive officer in April 2024.

*Cost of Goods Sold* - Cost of goods sold for the nine months ended March 31, 2025 were $2,744,656 compared to $1,572,668 for the nine months ended March 31, 2024. The cost of goods sold in both periods reflected the cost of procuring and assembling the component parts of the energy storage systems that were sold in each fiscal year and resulted in gross profits on such sales of approximately 25% and 24%, respectively, with the increase being partially due to the reversal in December 2024 of a prior year reserve for obsolescence on component parts of our NV-14Ks of $90,000.

*General and Administrative Expense* - General and administrative expenses for the nine months ended March 31, 2025 were $4,136,167 compared to $2,085,976 for the nine months ended March 31, 2024. Such increase was mainly due to our engagement of a new chief executive officer, who was engaged at an annual salary of $350,000 and also received a 4 year amortizing equity award of $2,854,000, as well as the hiring of several other employees since April 2024. The addition of these personnel has resulted in a higher level of both cash compensation expense and other associated expenses, such as marketing and travel, as well as non-cash stock compensation expenses related to the Company’s equity incentive programs.

*Research and Development Expense* - Research and development expenses for the nine months ended March 31, 2025 were $78,888 compared to $10,392 for the nine months ended March 31, 2024. Such fluctuation was largely due to timing differences in the level of the Company’s recent product development efforts.

*Other Income and Expense* - Interest expense for the nine months ended March 31, 2025 was $103,045 compared to zero for the nine months ended March 31, 2024, reflecting interest attributable to borrowings made under our line of credit and another borrowing arrangement obtained since June 30, 2024. Interest income for the nine months ended March 31, 2025 was $1,872 compared to $28,946 for the nine months ended March 31, 2024. This decrease was due to our lower level of investable cash in the nine months ended March 31, 2025.

*Net Loss* - Net loss for the nine months ended March 31, 2025 was $3,384,962 compared to $1,574,232 for the nine months ended March 31, 2024, representing the aggregate of the various revenue and expense categories indicated above. The Company has not recognized any income tax benefit for these net losses due to the uncertainty of its ultimate realization.

### Liquidity and Capital Resources

*Operating activities.* Net cash used in operating activities in the nine months ended March 31, 2025 was $3,501,515 compared to $988,827 in the nine months ended March 31, 2024. This increase was largely due to the current period increase in our comparative net loss, primarily resulting from an increase in our previously noted cash operating expenses for personnel and related costs, as well as the relatively higher changes in our net working capital needs, including recent stockpiling and prepayment of inventory, on a comparative basis.

*Financing activities.* Net cash provided by financing activities in the nine months ended March 31, 2025 was $3,051,054, compared to zero in the nine months ended March 31, 2024. In February 2025, we closed a private equity offering under which we issued a total of 543,500 shares of our common stock to the investors at an offering price of $2.00 per share resulting in gross proceeds of $1,087,000. In September 2024, we entered into an agreement with a newly formed financing entity whereby we obtained a line of credit for borrowings of up to $5,000,000. As of March 31, 2025, we had made net borrowings under this credit agreement in the total amount of $383,538 initially to fund a short-term loan that we made to a customer in October 2024, in the amount of $250,000, which was fully repaid in December 2024. Beginning in November 2024, we have made short-term borrowings from another lender in the total amount of $2,081,845, of which a portion had been repaid, leaving an outstanding balance as of March 31, 2025 of $1,420,116. While our increasing level of short-term borrowings from this lender have been made at a relatively high borrowing cost in terms of interest rate and fees, we have been able to meet our rising funding needs in this period in large part due to the timely responsiveness of this lender. In December 2024, we also received proceeds from the exercise of warrants issued in our August 2022 public offering in the amount of $160,400.

As of March 31, 2025, we had a cash balance of approximately $0.5 million and net working capital of approximately $4.2 million. Currently, we are not generating a break-even level of net operating cash flow from our net sales. However, we anticipate that demand for our products will ultimately increase over time and that, in conjunction with our recently obtained line of credit noted above and the completion of our February 2025 private offering, we will have sufficient cash to operate for at least the next 12 months.

### Other Developments

We continue to monitor current international developments occurring in Ukraine and Israel. However, we do not believe that they will have a significant impact on either the domestic markets for our products or the international supply chains for our product components, which are largely sourced from Asia.

Presently, our two main raw material components, batteries and inverters, are imported from different suppliers in China and, until recently, were subject to fairly low tariff rates that had been in effect for several years. Beginning in April 2025, the new Trump Administration implemented a significant increase in tariff rates on all goods imported from China that applies to our two main components. However, we anticipated the likelihood of facing such a tariff increase and have been stockpiling our inventory of these two components. As a result, we do not anticipate having to purchase a significant level of such components at post-tariff prices for the next several months while there are hopes that high level negotiations between China and the Trump Administration will ultimately lead to a mutually acceptable trade agreement.

In the event, however, that such a mutual trade agreement is not reached between the parties within the next several months and we find it necessary to begin purchasing a significant level of our inventory components from China at post-tariff prices, we would be faced with a decision as to whether we should attempt to pass along such tariff increases to our customers through higher prices for our products or absorbing them internally, or some combination of those two alternatives. Either circumstance would likely materially adversely affect our sales and/or our profitability.

### Off-Balance Sheet Arrangements

We have no obligations, assets or liabilities which would be considered off-balance sheet arrangements as defined in Item 303 of Regulation S-K.

### Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based on financial statements which have been prepared in accordance with generally accepted accounting principles in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. We believe that certain accounting policies affect our more significant judgments and estimates used in the preparation of our financial statements. See “Note 1. Business and Summary of Significant Accounting Policies” of the Notes to Financial Statements set forth above and under “Item 8. Financial Statements and Supplementary Data” of our Annual Report on Form 10-K for the year ended June 30, 2024, as filed with the SEC on September 27, 2024, for a further description of our critical accounting policies and estimates.

## Market risk

As filed, 138 characters.

Information for this Item is not required as the Registrant is a “smaller reporting company” as defined in Rule 12b-2 of the Exchange Act.

## Controls and procedures

As filed, 2,393 characters.

### Evaluation of Disclosure Controls and Procedures

We have established and maintain a system of disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in our reports filed with the Securities and Exchange Commission pursuant to the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Commission and that such information is accumulated and communicated to our management, including our Chief Executive Officer, who is our principal executive officer, and Chief Financial Officer, who is our principal financial and accounting officer, to allow timely decisions regarding required disclosures.

As of March 31, 2025, our Chief Executive Officer and Chief Financial Officer evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as a result of the material weakness relating to the lack of segregation of duties, our disclosure controls and procedures as of the end of the period covered by this Quarterly Report were not effective. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. We will be required to hire additional personnel in order to remediate our material weakness.

### Limitations on Effectiveness of Controls and Procedures

In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

### Changes in Internal Controls over Financial Reporting

There was no change in our internal controls over financial reporting that occurred during the quarter ended March 31, 2025, that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

## Risk factors

As filed, 2,655 characters.

There have been no material changes from the risk factors previously disclosed in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended June 30, 2024, as filed with the SEC on September 27, 2024 (the “Form 10-K”), under the heading “Risk Factors”, except as set forth below, and investors should review the risks provided in the Form 10-K prior to making an investment in the Company. The business, financial condition and operating results of the Company can be affected by a number of factors, whether currently known or unknown, including but not limited to those described in the Form 10-K for the year ended June 30, 2024, under “Risk Factors”, any one or more of which could, directly or indirectly, cause the Company’s actual financial condition and operating results to vary materially from past, or from anticipated future, financial condition and operating results. Any of these factors, in whole or in part, could materially and adversely affect the Company’s business, financial condition, operating results and stock price.

***The new Administration has introduced tariff increases that apply to the two main raw material components of our products which are sourced from Asian suppliers.***

Presently, our two main raw material components, batteries and inverters, are imported from different suppliers in China and, until recently, were subject to fairly low tariff rates that had been in effect for several years. Beginning in April 2025, the new Trump Administration implemented a significant increase in tariff rates on all goods imported from China that applies to our two main components. However, we anticipated the likelihood of facing such a tariff increase and have been stockpiling our inventory of these two components. As a result, we do not anticipate having to purchase a significant level of such components at post-tariff prices for the next several months while there are hopes that high level negotiations between China and the Trump Administration will ultimately lead to a mutually acceptable trade agreement.

In the event, however, that such a mutual trade agreement is not reached between the parties within the next several months and we find it necessary to begin purchasing a significant level of our inventory components from China at post-tariff prices, we would be faced with a decision as to whether we should attempt to pass along such tariff increases to our customers through higher prices for our products or absorbing them internally, or some combination of those two alternatives. Either circumstance would likely materially adversely affect our sales and/or our profitability.

Filed May 9, 2025.
Source: SEC EDGAR, the filing index for accession 0001683168-25-003355. Last ingested by Listed: Nov 4, 2026, 16:38 ET. No prices; not investment advice.