Worksport (WKSP) Q4 2024 earnings summary

Executive summary

• Fiscal 2024 saw record net sales of $8.48 million, up 455% year-over-year, with Q4 2024 revenue of $2.93 million, a 250% increase from Q4 2023, driven by new product launches, expanded sales channels, and U.S. manufacturing growth.

• Strategic focus shifted to higher-margin, Worksport-branded products, phasing out lower-margin offerings and resulting in significant gross margin improvement by year-end.

• Online sales surged to 58% of total revenue in 2024 (up from 7% in 2023), with strong growth in both B2C and B2B channels, and dealer network expanded by 30% in early 2025.

• Operational milestones included entry into government and fleet sectors, launch of the AL4 premium tonneau cover, and progress on clean energy products SOLIS, COR, and AetherLux.

• Significant margin expansion in Q4, with gross margins nearly tripling over Q3, attributed to the shift toward higher-margin branded products.

Financial highlights

• Full-year 2024 net sales reached $8.48 million, up from $1.53 million in 2023; Q4 2024 net sales were $2.93 million, up from $0.84 million in Q4 2023.

• Gross profit for 2024 was approximately $910,000, with gross margin improving to over 20% by December and nearly tripling in Q4 over Q3.

• Operating loss for 2024 was $16.16 million, up from $14.93 million in 2023, but loss per share improved 31% to $5.84.

• Cash and cash equivalents at year-end were $4.88 million, up from $3.37 million, with $892,000 available on a credit line; $6.3–$6.7 million raised via March 2025 warrant inducement.

• Working capital improved to $7.3 million, and inventories stood at $5.19 million, supporting 2025 sales targets.

Outlook and guidance

• 2025 revenue guidance is $20 million–$34.5 million, with the midpoint representing a tripling of 2024 revenue, supported by new product launches and order pipeline.

• Gross margin is forecast to reach 25–30% by late 2025, driven by premium product mix, economies of scale, and operational efficiency.

• Cash flow break-even targeted by late 2025 or early 2026, with disciplined cost management and moderate capex.

• No revenue from Terravis Energy's AetherLux heat pump is included in 2025 guidance.

• Anticipates significant decrease in operating losses and movement toward net income as branded sales accelerate.