Release Date: August 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Total company revenue increased to $33.3 million in Q2 2024, with service revenue representing approximately 20% of the total.
- Gross margin for the second quarter was 32.2%, aligning with the target guidance of 33%.
- Blink Charging Co (BLNK, Financial) contracted, sold, or deployed 4,106 chargers globally and dispersed nearly 33 gigawatts of energy across all Blink networks.
- Service revenue showed strong growth, making up 24% of total company revenue, a 300 basis point improvement from the previous year.
- Significant reduction in total operating expenses by 41% year-over-year, driven by a 54% reduction in compensation expense and a 24% reduction in G&A expenses.
Negative Points
- Lower sales bookings persisted throughout the second quarter, primarily driven by a slowdown in EV sales.
- Product sales in Q2 2024 were $23.6 million, a decrease compared to $24.6 million in Q2 2023.
- Gross profit for Q2 2024 was $10.7 million, down from $12.3 million in the same period last year.
- Adjusted EBITDA for Q2 2024 was a loss of $14.7 million, compared to a loss of $13.5 million in the prior year period.
- Cash and cash equivalents decreased to $73.9 million at the end of Q2 2024, down from $93.5 million at the end of Q1 2024.
Q & A Highlights
Q: Can you talk about the linearity of demand during the quarter and how things have progressed over the last few weeks?
A: Brendan Jones, President, Chief Executive Officer, Director: The demand was softer than expected throughout the quarter, continuing the trend from Q1. However, we are seeing positive signs for the future, with customers not backing off from their commitments. We expect a rebound in Q4 and beyond.
Q: What is driving the shift in product mix to third-party manufactured products?
A: Brendan Jones, President, Chief Executive Officer, Director: The shift is due to increased demand for single-port chargers, which we currently source from third parties. We are working to replace these with our own manufactured chargers from our facilities in Maryland and India.
Q: Can you provide an update on the Blink Mobility spin-off?
A: Brendan Jones, President, Chief Executive Officer, Director: The S-1 is nearly complete, and Roth is handling the spin-off. We are monitoring market conditions to determine the best timing for the IPO, likely in Q3 or Q4.
Q: How are you positioning or investing in the DC fast charger (DCFC) segment?
A: Brendan Jones, President, Chief Executive Officer, Director: We focus on projects with positive station economics, typically looking for a 4-year ROI. We are seeing growth in fleet and commercial settings and are strategically placing DCFCs in high-traffic urban areas.
Q: Can you give us a sense of Tesla versus non-Tesla charging at Blink stations?
A: Brendan Jones, President, Chief Executive Officer, Director: Tesla remains the number one brand plugging into our stations, but its percentage is decreasing as more competitors enter the market. We are seeing increased EV sales from other OEMs like GM, Hyundai, and BMW.
Q: Why was there flat revenue growth in car charging revenues from Q1 to Q2?
A: Brendan Jones, President, Chief Executive Officer, Director: The flat growth is due to maintenance and upgrading of older chargers, which temporarily takes them offline. We are also removing underperforming legacy chargers from the network.
Q: Should we expect a higher revenue mix from Europe due to challenges in the US?
A: Brendan Jones, President, Chief Executive Officer, Director: We expect Europe's revenue as a percentage of total Blink revenue to increase over time due to higher EV adoption rates and government incentives.
Q: Have SaaS solutions and energy management solutions been deprioritized?
A: Brendan Jones, President, Chief Executive Officer, Director: No, they have been reemphasized. We are adding resources in the US, Europe, and India to ensure timely delivery of these solutions.
Q: Can you discuss the flexibility of your business model with recent examples?
A: Michael Battaglia, Chief Operating Officer: We are seeing customers, like a major healthcare company, opting for us to take over their chargers to avoid maintenance responsibilities. This flexibility allows us to adapt to customer needs and maintain profitability.
Q: What continuous improvement activities are preserving gross margin?
A: Brendan Jones, President, Chief Executive Officer, Director: We have implemented cost reduction and avoidance measures across the company, including resourcing vendors, sunsetting duplicate systems, and closing underperforming business units. These activities have led to significant savings.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
