Fly-E Revenue Falls 53.3% to $2.6 Million in Fiscal Third Quarter
Key Facts
Fly-E Group reported net revenue of $2.6 million in the third quarter of fiscal 2026, down 53.3% from $5.7 million in the same period a year earlier, according to an earnings release published via PR Newswire. The company attributed the decline mainly to an 87% drop in the number of electric vehicles sold, alongside lower selling prices to reduce old inventory. The figures show revenue contracting as the business mix shifted, with retail sales falling sharply while wholesale and leasing services revenue increased. Chief Executive Zo (Andy) Ou said the company “continued to focus on executing its strategy and advancing initiatives to navigate a challenging environment and cautious consumer demand.”
Revenue channels delivered mixed performances during the quarter. Retail sales revenue fell 86.8% to $0.6 million compared with the same period last year, while wholesale revenue rose 153.4% to $1.8 million. Leasing services revenue also increased 288.6% to $0.2 million. The gains in wholesale and leasing, however, did not offset the decline in retail revenue, which remained the weakest of the channels cited in the results. The company linked retail pressures to customer concerns following lithium battery incidents involving electric bicycles and scooters in New York, as well as store closures and exits from other locations.
The sales decline weighed on gross profitability, with gross profit falling to $1.0 million from $2.6 million in the year-earlier quarter. Gross margin narrowed to 39.6% from 45.1%, meaning the company generated less gross profit for each dollar of revenue during the quarter. This came as the company said it had reduced selling prices to address old inventory, alongside a significant decline in the number of vehicles sold. The comparison shows that the shift toward growth in wholesale and leasing did not prevent gross profit from falling or margins from narrowing. The available facts in the release did not provide a separate figure for the effect of price cuts on margin.
Net loss widened to $1.9 million from $0.7 million in the same period a year earlier. Basic and diluted loss per share was $1.18, compared with $2.78 a year earlier, according to the earnings release. Thus, the overall loss moved in a worse direction, while the reported loss per share was lower than the prior-year figure. This divergence places the per-share result alongside declines in revenue and gross profit, without changing the fact that net loss widened during the quarter. The available facts did not provide a separate explanation for the movement in loss per share or a detailed reconciliation of its components.
Revenue weakness extended to the nine months ended December 31, 2025, a prior period included in the company’s release as background on performance. Net revenue for the period fell 41.7% to $11.9 million from $20.4 million in the comparable period, while units sold declined from 41,925 to 26,478. The nine-month results put the quarter in the context of a broader contraction in revenue and volumes, though the measurement periods differ from fiscal third-quarter 2026. The company described its direction as a leaner business mix, citing growth in wholesale and leasing during the quarter. Ou said cautious consumer demand and a challenging environment remain among the factors the company’s initiatives are addressing.
The company also faces financing and legal matters separate from its operating results. In its filing with the U.S. Securities and Exchange Commission, it disclosed that Peapack Private Bank & Trust filed a lawsuit on October 30, 2026, seeking repayment of amounts due under a revolving credit facility with a maximum principal amount of $5,000,000. In a November proxy supplement, the company postponed its special shareholder meeting to November 27, 2026. The financing proposal submitted for shareholder approval carries an aggregate cap of $9,000,000 and a maximum of 25,000,000 shares. The upcoming meeting date and financing proposal put liquidity and the potential issuance of new shares among the matters shareholders are expected to consider.