Blink Charging Co. Q4 FY2024 earnings call

Key Points

• Michael Battaglia assumed CEO role Feb 1. 2024 saw growth in service revenue, with record full-year results. Blink-owned chargers footprint expanded. Efforts in alternative sales channels for hardware. Cost reduction actions led to 24% reduction in operating expenses (adjusted for non-cash items) in 2024. Q4 2024 dispersed 42.5 gigawatt hours of energy, a 100%+ year-over-year increase. DC fast charger revenue in 2024 was up nearly 500% vs 2023. Europe operations are leading, with software network consolidation in Europe. Reduced cash burn by 51% in 2024, with Q4 operating cash burn reduced from $18M per quarter to $9M per quarter.

In Q4 2024, consolidated revenue was $30 million, a 20% sequential increase. Service revenues grew 24% to $9.8 million, and network fees increased 9% to $2.4 million year over year. For the full year 2024, total revenues were $126 million. Service revenue for the year was $35 million, a record, driven by increased utilization, more Blink-owned chargers, and a higher mix of DC fast chargers. Gross margin for the full year was 32%. Product sales in 2024 faced challenges but focused on verticals like large electrical distributors and governments, providing profitable revenue.

Forward-Looking Statements

• Service revenues expected to continue increasing in 2025. Product revenue in first half 2025 expected to be similar to back half 2024, with improvement anticipated in second half. Adjusted EBITDA target timeline updated due to macro dynamics; better visibility on reaching adjusted EBITDA profitability to be provided as year progresses. Focus on continuing to grow revenues while reducing operating expenses and cash burn to drive towards profitability.

Risks

• Tariffs as a moving target could impact gross margin. Market consolidation in the EV charging industry, both in US and Europe, presents dynamic challenges. Regulatory changes could affect operations and market dynamics.

Q: Please elaborate on the 2025 outlook for product sales visibility beyond the next six months and year-over-year growth expectations.

A: Michael Battaglia mentioned Chris Carr, new SVP of Sales and Business Development, has plans in place. Product sales in first half 2025 somewhat cloudy, but optimistic about second half with better visibility to come.

Q: Any targets or pipeline for acquisitions in Europe or other regions to capitalize on market consolidation?

A: Michael Battaglia stated there are companies under consideration, being selective to ensure right fit and avoiding overpayment.

Q: Timeline on Envoy IPO and process status?

A: Michael Battaglia said on track for spring IPO, with more details to come.

Q: Thoughts on shifting to owner-operator model and impact on margins, and if it's a reaction to market dynamics?

A: Michael Battaglia emphasized it's not a reaction but long-term intention to accelerate owner-operator business, not giving up on product side; margins expected to be influenced by owner-operator side with better fee control and product side managing inventory more efficiently.

Q: Utilization growth and impact of NACS connectors on Blink Charging Co. network?

A: Michael Battaglia said not many NACS connectors deployed yet, but focus on deploying them going forward.

Q: Cost-out progress and path to positive EBITDA?

A: Michael Battaglia said need top line growth and additional cost reduction, evaluating all cost aspects, with compensation expense likely to come down mostly via attrition and other costs also being reduced.

Q: Business mix favorability, state support impact on product growth in 2025?

A: Michael Battaglia mentioned state contracts like Maryland and New York, and opportunities in Europe like UK's LEVI program, indicating diversification and expectation of growth from these areas.

Q: Balance sheet and working capital squeeze potential?

A: Michael Rama said still implementing measures to squeeze AR and inventory, improving working capital management.

Q: Details on alternative customer channels and progress?

A: Michael Battaglia mentioned progress with electrical distributors and local municipalities, spending time developing electrical distribution channel and partnering with municipalities on infrastructure.

Q: Hurdles in growing owner-operator business and focus by geography?

A: Michael Battaglia said challenge is capital, actively pursuing non-dilutive capital sources; focus on both US and Europe, not choosing one over the other.

Q: Protection from regulatory changes and tariffs?

A: Michael Battaglia said US production facility helps shield from some tariffs, India production footprint has lower cost base to absorb potential tariffs.

Q: Impairment charge timing and details?

A: Michael Rama explained fourth quarter impairment exercise, related to annual or off-quarter indicators, tied to acquisitions from higher valuation periods.

Q: Residential EV charging and upgrades in developments?

A: Michael Battaglia said Blink Charging Co. not in pure residential market, but sees activity in commercial multifamily with building codes requiring stub-ups, and anecdotal increase in additional equipment requests at existing sites