Q1 2025 Gogoro Inc Earnings Call
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Speaker Change: Welcome to the Gogoro 2025 first quarter earnings call. This conference call is being recorded and broadcast live on the internet. Webcast replay will be available within an hour after the conference is finished. I'd now like to turn the call over to Gogoro team.
Speaker Change: Welcome to Gogoro's 2025 First Quarter Earnings Conference Call hosted by our Interim CEO Henry John and myself CFO Bruce Akin.
Speaker Change: Hopefully by now you've seen our earnings release. If you haven't, it's available on the Investor Relations tab of our website, investor.googoro.com
Speaker Change: We are hosting our earnings conference called the Alive webcast through Gogoro's website where you can also download all of the earnings release materials.
Speaker Change: We will be displaying the materials on the webcast screen as we go. If you're joining us through the conference call, your dial in lines are in listen only mode.
Speaker Change: Henry will provide an overview of Gogoro's progress. I will then go into the first quarter financial results in more detail and we will open the line for questions and answers and answer as many questions as we can.
Speaker Change: As usual, we would like to remind everyone that today's discussion may contain forward looking statements that are subject to risks and uncertainties, which could cause actual results to differ materially from those contained in the forward looking statements.
Speaker Change: Please refer to the forward-looking statements that appear in our press release and investor relations presentation provided today. Additionally, many of the financial figures we will use in our webcast are on a non-IFRS basis.
Speaker Change: For details about the non-IFRS measures and reconciliation to the corresponding IFRS measures please refer to our earnings release.
Henry Jiang: And now I would like to turn the call over to Henry.
Thank you.
Speaker Change: Good morning and good evening everyone and thank you for joining us for Gogoro's first quarter earnings call for 2025.
Speaker Change: The word that best describes our hard work in the last quarter of 2024 and the first quarter of 2025 is focused.
Speaker Change: We are focused on delivering a great experience for our customers, predictable financial results and a clear vision for the future. We are executing our plan.
Speaker Change: We have spoken repeatedly about our business priorities in our energy business and our vehicle business.
Our profitability timeline commitment remains unchanged.
Achieve break even in the energy business by 2026
Speaker Change: Generate positive free cash for in the energy business in 2027 and break even in the vehicle business in 2028. There is significant progress to report in each area.
The results of our focus on resetting are clear.
Speaker Change: In the first quarter, we achieved an non-ISRS gross margin of 18.2%.
Speaker Change: a reduced operating expenses by 9.9 million, a full 32.1% reduction versus the first quarter of 2024.
Speaker Change: Fundamentally, our focus on efficiency is pain loss, which we see in a reduced adjusted net loss by 36.5%.
to 10.9 million in the first quarter from
Speaker Change: 17.2 million in the first quarter of 2024. Additionally, adjusted EBDA is 14.3 million in the first quarter versus 10.2 million in the first quarter of 2024.
Speaker Change: These results have been achieved despite a year-over-year drop of 8.7% in revenue for the first quarter.
Speaker Change: Based on the early positive results of our strategy reset,
Speaker Change: We have received a new $2 billion NT dollar, approximately $61.5 million US dollar credit facility which both provides capital for growth and also indicates market confidence in our plans for the future.
Speaker Change: Energy business, our core energy business continues to perform as expected.
Speaker Change: In the first quarter we recorded revenue of 34.5 million in a Gogoro network business.
Speaker Change: In line with our projections and showing 6.2% growth versus the first quarter of 2024.
Speaker Change: The energy business grows alongside the increasing subscriber base of Gogoro platform and we now have a total of 644,000 subscribers.
Speaker Change: In the first quarter, we launched a new off-teak, unlimited mileage plan which offers subscribers more flexible pricing options.
Initial Market Feedback is POSNESS.
Speaker Change: We launched a redesigned Gogoro app delivering a more seamless experience for subscribers.
including more clearly surfacing.
Speaker Change: Information regarding their writing efficiency, guiding them to the path go station to swap their batteries and other details which not only improve their experience but also make their use of Gogoro Vehicle more efficient.
Speaker Change: Our energy storage collaboration with Type Power continues to progress as scheduled, and we continue to explore additional second-life application for our battery.
Vehicle business.
Speaker Change: We have streamlined our vehicle offerings in the first quarter and has seen an increase in ASP and margin in our hardware sales business.
We have multiple vehicle launchers planted.
Speaker Change: While our hardware sales revenue and volume performance was below expectations, we believe this is a push out of revenue rather than a reduction in revenue.
Speaker Change: Revenue for the hardware business was 29.1 million in the first quarter.
We launched
Speaker Change: A new Delay model to expand reach to younger customers. We launched a new Starlux airline co-branded model with record hype in sales and market excitement.
Speaker Change: We anticipate additional launches in the coming months and will announce those as soon as we can.
Speaker Change: Additionally, we will continue to work closely with PPGM partners and our offering programs to help our PPGM partners launch new vehicles.
in international markets.
Speaker Change: We completed the sign of a joint venture agreement with Castro to expand internationally and we expect to begin a pilot program together with Castro in the second half of 2025.
Speaker Change: The partnership allows Gogoro to focus on collaborating to expand the use of our technology with a large and well-known brand.
We are excited about the prospects for this relationship.
Speaker Change: In India, we are working with several potential candidates to pivot our strategy to provide in technology support.
Speaker Change: We are continuing to close the monitor policy developments regarding battery swapping and government support for battery swapping platforms.
Infrastructure, skill and a future
Speaker Change: In addition to implementing our strategy, I would like to emphasize that we continue to receive support from both the Taiwan Central Government as well as local government to implement EV policies.
Speaker Change: The Gauchel and Tainan city governments now provide subsidies to work customers.
Speaker Change: Monthly subscription spending. In Thailand, a customer can get up to $580, approximately $15 USD per month in subsidies.
Speaker Change: And in Gaucho, a customer can get up to $7,220 approximately $125 US dollar of annual subsidy toward their subscription spending.
Speaker Change: We continue to add to our 600 million infrastructure investment over the last 10 years, which has largely driven our losses.
Speaker Change: That investment has led to a strong foundation for EV adoption in Taiwan and has created high industry standards.
Speaker Change: The Taiwan Central Government, as well as local governments, continue to implement the adoption policies and retain their commitment to net zero goals.
Speaker Change: The combination of our broadly deployed infrastructure and customer adoption indicate a clear future for Gogoro.
Speaker Change: We are on track to reach our short-term and longer-term goals.
Speaker Change: We seek to achieve these goals by continuing to focus on financial disciplines focusing on our energy and vehicle business and by working with partners for international expansion.
NASDAQ STATES
Speaker Change: Finally, as announced in our 6K following on May 2nd, 2025, we have transferred our listing from the NASDAQ Global Select Market to the NASDAQ Capital Market.
Speaker Change: The global macro environment continues to present significant challenges, include volatility in US markets and ongoing tariff issues.
Speaker Change: which have contributed to persistent downward pressure on broader market consumer confidence on Gogoro's share price.
Speaker Change: Logo remains to retain our NAFTA listing status while working to increase awareness in U.S.
Speaker Change: and global capital markets about the potential of the Asian two-wheeler market and the innovation opportunities within it which Gogoro is well positioned to address.
Speaker Change: Thanks, and now I invite Bruce to give a bit more detail into our financial results from the first quarter. Thank you, Henry.
Bruce Aitken: We delivered meaningful financial improvements in the first quarter of 2025 and demonstrated that our focus is clear and effective.
Bruce Aitken: Just to recap a few of the important figures, in comparison to the first quarter of 2024, we grew our battery swapping revenue to $34.5 million.
Bruce Aitken: We increased our company wide non IFRS gross margin to 18.2% and we increased total adjusted EBITDA to 14.3 million dollars of 40% increase on the previous year.
Bruce Aitken: We also saw a reduction of $9.6 million in operating expenses and all of these results were achieved despite a 4.5% drop in total revenue versus Q1 2024 on a constant currency basis.
Bruce Aitken: We continue to see increases in our total install base of batteries and subscribers Total kilometers written on Gogoro's ecosystem and continued market penetration
Bruce Aitken: Battery swapping service revenue for the first quarter was 6.2% up year over year and 11.1% up year over year on a constant currency basis.
Bruce Aitken: Total subscribers at the end of the first quarter was 644,000, up 8% from 595,000 subscribers at the end of the same quarter last year.
Bruce Aitken: We continue to see the strength of our subscription-based business model, which enables us to recruit more customers to maximize our battery-swapping network efficiency.
Bruce Aitken: Sales of hardware and other revenue for the first quarter was $29.1 million down 21.8% year-over-year and down 18.1% year-over-year on a constant currency
Bruce Aitken: The year-over-year decrease in sales of hardware and other revenues was driven primarily by a decrease in vehicle sales volume on a year-over-year basis due to the delayed launch of one anticipated vehicle.
We believe this demand will shift to subsequent quarters.
Bruce Aitken: Additional factors include a minor reduction in part success, reason, service, revenue, and less international sales than in Q1 of 2024.
Bruce Aitken: For the first quarter, non-IFRS gross margin was 18.2%, up from 15.1% in the same quarter last year.
Bruce Aitken: This was primarily driven by lower depreciation across our entire install base of battery packs from increased network efficiency, as well as the extended lifespan of upgraded batteries.
Bruce Aitken: In the first quarter we decreased operating expenses by $9.6 million. This was the result of our focus on savings in general and administrative expenses and marketing and promotional expenses and other organizational efficiency efforts.
Bruce Aitken: Over the last three years, we have invested approximately $100 million per year in capital expenditures.
Bruce Aitken: For the first quarter, net loss was $18.6 million, but the adjusted Ida Da was $14.3 million representing an increase of $4.1 million from $10.2 million in the same quarter last year.
Bruce Aitken: This sets us up well to deliver against our financial targets for the year and for each of our businesses.
Bruce Aitken: With a cash balance of 93.3 million at the end of the first quarter of 2025 and the additional credit facilities that are available to us, we believe we have sufficient sources of funding to meet our near-term business growth objectives.
Bruce Aitken: In the first quarter we continued our focus on cost optimization and aligned our operations accordingly.
Bruce Aitken: The plan aims to drive operational efficiency, reduce costs, accelerate our path to profitability, and reinforce our primary focus as an energy and subscription-based business based on our energy platform leadership.
Bruce Aitken: Gogoro is expected to create approximately $25 million in savings in 2025 compared to 2024 as a result of this cost efficiency plan.
Bruce Aitken: We expect our Gogro network battery-swapping business to reach profitability on a non-IFRS basis and deliver non-IFRS net income in 2026 and our hardware sales business to reach profitability on a non-IFRS basis in 2028.
Bruce Aitken: We believe the Taiwan two-wheeler market in 2025 will remain at approximately 2024 levels.
Bruce Aitken: For the 4-year 2025 we reiterate our revenue forecast of between $295 million to $315 million on a constant currency basis.
Bruce Aitken: We estimate that approximately 95% of such full-year revenue will be generated from the Taiwan market.
Bruce Aitken: Our gross margin may be continuously negatively impacted in the short term because of our ongoing and accelerated battery upgrade initiatives which are expected to be completed by the end of 2025.
Bruce Aitken: We believe that Gogoro is on the right path to profitability. We're conscious of the need to stay focused and deliver, and we look forward to doing so throughout the balance of 2025.
We will now take questions.
Thank you Henry and Bruce for the updates.
Bruce Aitken: As attendees are formulating their questions, I will ask a few questions that we have collected in advance.
Speaker Change: First question, looks like Gogoro is focusing on your network business with super charge and quick charge technologies dramatically improving and shortening the electric vehicle charging time. Do you view that as a threat or how are you going to respond to the continued improvement of charging time for charging station models?
Yeah.
Thank you.
Speaker Change: We recognize the rapid advancements being made in fast charging and super charging technology across the broader
Speaker Change: But these innovations are helping accelerate the adoption overall which is positive for the entire industry.
Speaker Change: However, we don't view them as a direct threat to Gogoro's factory-shopping model.
Speaker Change: Our battery-socking platform was purpose-built for the unique needs for urban mobility.
Speaker Change: particularly nearly two mullers. The key value proposition remains speed, convenience, and efficiency.
With Gogoro a rider can swap and
Speaker Change: depleted battery for a fully charged at 1 in less than 6 seconds.
Speaker Change: No wasting time, no grip strength and no need for dedicating partying or long away time.
which are often required even with their fastest chargers.
Speaker Change: And I think fast charging often comes with trade-offs, including battery integration infrastructure investment and great stability issues.
Our closed-loop system allows us to better management battery health.
Speaker Change: Optimize energy load and offer a consistent user experience of scale. This is especially relevant in high-density urban environment like those in Taiwan and Southeast Asia.
Speaker Change: That said, we are not standing still. We continue to invest in R&D to improve our battery technology, energy efficiency and systems scalability.
Speaker Change: So in short we see the advancement of charging technology as part of the broader ecosystem. We've got evolved evolution.
Speaker Change: Our focus remains on being the most efficient, scalable, and rider-centric energy platform for urban mobility, based on our battery-swapping technology.
Speaker Change: Thank you, our second question. Please provide some commentary on the transfer to the NASDAQ capital market as well as your future plans to gain compliance with NASDAQ requirements and other plans for your listing status.
Speaker Change: Thanks for the question. As we did mention briefly during the call we have completed a transfer from the NASDAQ Global Select Market to the NASDAQ Capital Market in late April and by doing so we gained an additional 180-day grace period to regain compliance with the NASDAQ.
Speaker Change: bid price requirement that gives us till the end of October almost to be compliant so.
We're not focused on short-term stock price gains. We believe that our financial improvements which is
Speaker Change: Hopefully you've seen some of today really indicates that we're on the right track and we're delivering against our stated plans so we're taking the long term view on the stock.
Speaker Change: And obviously we hope there's organic stock price increase over the course of the next 180 or so days.
Speaker Change: In addition to that organic increase, there are a number of different options that we could explore. For regaining compliance, those could include a reverse stock split, for example, or other actions, and we'll carefully consider all of those actions.
Speaker Change: and provide updates to our shareholders into the public markets as we can in the interim but we do not have any immediate plans.
Speaker Change: And so we'll continue to watch the stock price, we'll continue to evaluate all options over the course of the next few months up until the extended deadline in late October .
Thank you question number three.
Speaker Change: You mentioned the network business and scooter business will break even in 2026 and 2028 respectively to help us drive to help us drive Gogoro's value today. What is your longer term top line and bottom line growth plans?
Thanks for that one too. I'll take this one. So.
Speaker Change: You know, as you said, we anticipate network break even in 26, scooter break even 2028 and network cash flow positive in 2027. And so we do see the opportunity as soon as we've reached those.
Speaker Change: specific milestones to really have a meaningful shift in operational leverage and a meaningful shift in our profitability. So from a top line standpoint the biggest driver of our growth is the increasing subscription.
business that we have which is predictable it's recurring
Speaker Change: We have 644,000 subscribers right now and every new subscriber that we add to the network contributes.
to our top line growth in addition to that top line growth.
Speaker Change: In the energy business we do obviously see sales of Gogoro branded vehicles and partner branded vehicles as well being good sources of revenue in the future.
Speaker Change: At a bottom line level, we expect improvement in that income.
Speaker Change: Because as the revenue grows, we don't expect our cost-base, our fixed cost-base.
Speaker Change: to grow at the same speed so we should be able to leverage higher margin network services business.
Speaker Change: as that becomes a bigger and bigger part of our overall revenue. So the key to Gogoro's business is the recurring revenue nature of our accumulating subscriber base.
Speaker Change: We're seeing that now we're predicting break even in 2026. It's possible that we'll even see kind of operational break even toward the end of this year. And so once we've gotten to that point, then I think the story really shifts and we've become about growth going into the future.
Speaker Change: Thank you. Question number four. Congratulations on the good progress on controlling costs.
Speaker Change: I'm wondering whether your current operating efficiency model is sustainable and scalable when Gogoro grows beyond break even points. And can you touch on your cost structure and gross margin between the two different business models, i.e. network business and scooter business model, thanks.
Speaker Change: Thank you thank you for the questions and for also recognizing the progress we have made on cost control. To address your first point yes we believe our current operating efficiency model is both sustainable and scalable.
Speaker Change: Over the past few quarters we have made deliberate efforts to streamline operations, optimize our supply chain and leverage automation where possible. As we move beyond break even a scale into new markets, these.
Speaker Change: Efficiency gives us a strong foundation and most importantly our platform our platform or course especially with our battery socket network allows us to scale without a linear increase in operating costs. That's the key
Speaker Change: And now on the cost structure and gross margin between the two pieces models in our network which includes battery swapping and energy services.
Speaker Change: We see predictable and repeatable growth models. This is largely due to the recurrent nature of the revenue and the capital efficiency of the infrastructure once it's deployed.
Speaker Change: So as utilizations grows, margins improve further due to operating leverage.
So, and on the student business side.
Speaker Change: goes margin are more sensitive to component cost and volume. So however we view the vehicle business as a strategic enabler, it drives adoptions of our energy platform and helps to improve the system.
Speaker Change: So going forward, we remain focused on improving margins across post-sync segments, but particularly on expanding the number of the core engine of the long-term profitability.
Thanks again for the question it's really
Give us an opportunity to explain our thoughts.
And those were all the questions that I had.
Bye.
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Speaker Change: Okay, so let's continue. Thanks for attending today's call. It should be clear that our focus is paying off. We are seeing improved financial performance and we will continue to execute on this path to profitability.
Speaker Change: We think our customers for their trust in Gogoro and we think all of these that you join the call We will keep working to provide the best factory swapping service in the world while also innovative for the future
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Speaker Change: The conference call has now concluded. Thank you for attending today. You may now just connect.
I love you.
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