Solesence (SLSN) Q1 2025 earnings summary

Executive summary

• Achieved record Q1 2025 revenue of $14.6 million, up 48% year-over-year, driven by strong consumer product sales, major brand partnerships, and a significant new product launch.

• Uplisted to Nasdaq in April 2025, increasing visibility, liquidity, and access to capital.

• Rebranded from Nanophase Technologies to Solesence, Inc. in March 2025.

• Shipment and production volumes rose sharply to meet demand, with shipment volume up 95% and production up 120% year-over-year.

• Three largest customers accounted for 42% of Q1 2025 revenue, down from 61% in Q1 2024.

Financial highlights

• Q1 2025 revenue was $14.6 million, up from $9.9 million in Q1 2024, led by consumer products.

• Gross profit was $3.3–$3.4 million, down from $3.6 million, as gross margin declined to 23% from 36% due to one-time startup costs.

• Net income was breakeven ($80,000), compared to $0.9 million in Q1 2024.

• Operating cash flow was negative $7.2 million, compared to negative $3.9 million in Q1 2024.

• Cash balance at quarter-end was $1.8 million, up from $1.4 million at year-end 2024.

Outlook and guidance

• Gross margins are expected to rebound above 30% for the full year, with Q1 being an anomalous low-margin quarter.

• Sequential revenue growth and record Q2 2025 revenues are anticipated, with more reorders and launches in the second half of 2025.

• Management is focused on capacity expansion, cost efficiency, and expects minimal impact from Q1 startup costs in Q2.

• Capital spending for 2025 projected at $2M–$4M, funded by operations, credit, and possible new debt.