Yahoo Finance EVgo Inc (EVGO) (Q1 2024) Earnings Call Transcript Highlights: Surging Revenues and Expanding ...
Revenue: $55.2 million, a 118% year-over-year increase.
Net Income: Adjusted EBITDA was negative $7.2 million, improving by $12.9 million from the previous year.
Earnings Per Share (EPS): Not specifically mentioned.
Free Cash Flow: Cash used in operations was $14.1 million, capital expenditures were $21.1 million.
Gross Margin: Adjusted gross margin was 31.3%.
Store Locations: Added 250 new operational installs in Q1; total operational stores approximately 3,240.
Customer Accounts: Grew to more than 981,000, a 60% increase year-over-year.
Throughput: Over 53 gigawatt hours, nearly tripled year-over-year.
Release Date: May 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
EVgo Inc (NASDAQ:EVGO) reported a significant year-over-year revenue increase of 118% in Q1 2024, reaching $55.2 million.
The company experienced a substantial growth in network throughput, which nearly tripled year-over-year.
EVgo Inc (NASDAQ:EVGO) added 250 new operational installs in Q1, expanding the total number of stores to approximately 3,240, marking a 38% increase from the previous year.
Customer base grew by 60% year-over-year, with EVgo Inc (NASDAQ:EVGO) ending the quarter with more than 981,000 customer accounts.
The company is on track to achieve EBITDA breakeven by the full year of 2025, supported by strong operational efficiencies and expanding network.
Negative Points
The CFO, Olga Shevorenkova, announced her departure from EVgo Inc (NASDAQ:EVGO), which could lead to transitional challenges in the finance department.
Despite strong growth, EVgo Inc (NASDAQ:EVGO) still reported a negative adjusted EBITDA of $7.2 million in Q1 2024, although this was an improvement over the previous year.
The company faces uncertainties in EV sales, which could impact the final throughput numbers and financial performance for the year.
EVgo Inc (NASDAQ:EVGO) is heavily reliant on external financing to sustain its expansion, with significant capital expected to be raised through grants, OEM payments, and incentives.
There is a noted seasonality in the business, with fluctuations in throughput and possibly margins due to varying utility tariffs and customer driving patterns.
Q & A Highlights
Q: Can you provide general thoughts on the impact of Tesla's decision to halt the expansion of their Supercharger network on EVgo's market share in both the near and long term? A: (Badar Khan, CEO) The decision is seen as positive for the sector and particularly for EVgo, as it allows Tesla to focus on producing more affordable cars, which is crucial for mass EV adoption. This shift in the competitive landscape is expected to benefit companies like EVgo, allowing them to fill the gap in charging station growth left by Tesla.
Q: Could you provide more details on the DOE loan process and the expected timing for an answer? A: (Badar Khan, CEO) EVgo has submitted a high-quality application for the DOE loan under Title 17, and discussions have been positive. The company expects an answer within the year, which could significantly accelerate their growth rate and help achieve cash flow breakeven sooner.
Q: How should we think about the throughput growth going forward, considering the seasonality observed? A: (Badar Khan, CEO) Throughput per store per day is expected to align with seasonal patterns, with a significant increase anticipated in April. The company has observed a seasonal impact, which is now becoming more apparent as the network grows.
Q: Can you update us on the software improvements expected later this year and their impact on operations? A: (Badar Khan, CEO) EVgo is focusing on efficiency improvements, including software updates for predictive maintenance and automated diagnostics. These improvements are expected to reduce operational costs significantly, such as reducing truck rolls and customer service calls, contributing to a 20% reduction in sustaining G&A costs by the end of the year.
Q: With the potential for increased growth beyond the current rate of 800 to 900 new stores per year, does EVgo have enough profitable site opportunities to support this expansion? A: (Badar Khan, CEO) Yes, EVgo has identified over 10,000 sites that meet their return expectations. With the changing competitive dynamics, these locations are likely to become even more attractive, supporting a faster and more profitable expansion.
Q: What are the expectations for dynamic demand-based pricing and its impact on the network? A: (Badar Khan, CEO) EVgo is implementing dynamic demand-based pricing, which is expected to improve margin profiles significantly. This pricing strategy will help manage network utilization more effectively, catering to different customer segments and potentially increasing overall profitability.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
