Flux Power Holdings, Inc 10-Q for FY2026 Q1

Flux Power Holdings, Inc. (FLUX)

10-Q 2025-11-13 For: 2025-09-30

Added on April 11, 2026

About this 10-Q

Flux Power Holdings, Inc filed this 10-Q on November 13, 2025, covering the quarter ended September 30, 2025 (FY2026 Q1).

Headline figures

Quarter ended September 30, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $13.18M; down 18.3% from $16.13M a year earlier
Net loss: $2.56M; compared with a net loss of $1.67M a year earlier
Diluted EPS: -$0.15; compared with -$0.10 a year earlier

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Nevada		92-3550089
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification Number)

2685 S. Melrose Drive, Vista, California		92081
(Address of principal executive offices)		(Zip Code)

Title of Each Class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.001 per share		FLUX		Nasdaq Capital Market

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

PART I - Financial Information

ITEM 1.	CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)	5
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	26
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	33
ITEM 4.	CONTROLS AND PROCEDURES	34

PART II - Other Information

ITEM 1.	LEGAL PROCEEDINGS	36
ITEM 1A.	RISK FACTORS	38
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	39
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	39
ITEM 4.	MINE SAFETY DISCLOSURES	39
ITEM 5.	OTHER INFORMATION	39
ITEM 6.	EXHIBITS	39

SIGNATURES		40

	●	our ability to comply with the terms of our agreement with Gibraltar Business Capital, LLC (“GBC”) for our credit facility, which we have relied on historically and currently rely on to meet our anticipated capital resources and to fund our operations;

	●	our ability to meet projected revenue targets and generate cash from operations as a result of delays in new orders for our energy storage solutions, reflecting corresponding deferrals of new forklift purchases by selected large customer fleets caused by lower capital spending and interest rate variability, and more recently, global tariff uncertainties;

	●	our ability to remediate material weaknesses in our controls and procedures and also those identified in our internal control over financial reporting, or to accurately or timely report our financial condition or results of operations, which may adversely affect our business and stock price;

	●	our ability to continue to meet the continued listing standards of the Nasdaq Stock Market;

	●	our ability to secure sufficient funding to support our current and proposed operations;

	●	our ability to manage our working capital requirements efficiently;

	●	our ability to obtain the necessary funds from our credit facilities;

	●	our ability to obtain raw materials and other supplies for our products at existing or competitive prices and on a timely basis;

	●	our anticipated growth strategies and our ability to manage the expansion of our business operations effectively;

	●	our ability to maintain or increase our market share in the competitive markets in which we do business;

	●	our ability to grow our revenue, increase our gross profit margin and become a profitable business;

	●	our ability to fulfill our backlog of open sales orders due to delays in the receipt of key component parts and other potential manufacturing disruptions;

	●	our ability to keep up with rapidly changing technologies and evolving industry standards, including our ability to achieve technological advances;

	●	our dependence on the growth in demand for our products;

	●	our ability to compete with larger companies with far greater resources than us;

	●	our ability to shift to new suppliers and incorporate new components into our products in a manner that is not disruptive to our business;

	●	our ability to obtain and maintain UL Listings and OEM approvals for our energy storage solutions;

	●	our ability to diversify our product offerings and capture new market opportunities;

	●	our ability to source our needs for skilled labor, machinery, parts, and raw materials economically;

	●	our ability to retain and/or successfully recruit key members of our senior management team;

	●	our dependence on our major customers;

	●	the impact of tariffs on our ability to cost-effectively source battery packs and materials used in our products; and

	●	the expense, timing and outcome of legal proceedings relating to our accounting practices, financial disclosures and employment policies and practices, which includes, but are not limited to, a pending purported federal securities class action and stockholder derivative lawsuit, certain employment lawsuits and other legal and governmental proceedings, investigations and information requests that may be initiated or that may be asserted.

	●	The “Company,” “Flux,” “we,” “us,” and “our” refer to the combined business of Flux Power Holdings, Inc., a Nevada corporation and its wholly owned subsidiary, Flux Power, Inc., a California corporation (“Flux Power”);

	●	“Exchange Act” refers the Securities Exchange Act of 1934, as amended;

	●	“SEC” refers to the Securities and Exchange Commission;

	●	“Securities Act” refers to the Securities Act of 1933, as amended;

	●	This “Quarterly Report”, “Form 10-Q” and “Current Report” refer to this Quarterly Report on Form 10-Q pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934.

	September 30,			June 30,
	2025			2025
ASSETS

Current assets:
Cash	$	1,588,000		$	1,334,000
Accounts receivable, net of allowance for credit losses of $68,000 at September 30, 2025 and June 30, 2025		7,497,000			11,374,000
Inventories, net		15,726,000			17,231,000
Other current assets		2,146,000			1,865,000
Total current assets		26,957,000			31,804,000

Right of use assets, net		1,125,000			1,275,000
Property, plant and equipment, net		1,505,000			1,554,000
Other assets		108,000			119,000

Total assets	$	29,695,000		$	34,752,000

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

Current liabilities:
Accounts payable	$	13,739,000		$	16,295,000
Accrued expenses		7,504,000			7,058,000
Line of credit		9,935,000			13,627,000
Subordinated debt		–			1,000,000
Deferred revenue		129,000			459,000
Customer deposits		38,000			38,000
Finance leases payable, current portion		90,000			80,000
Office leases payable, current portion		651,000			815,000
Accrued interest		83,000			246,000
Total current liabilities		32,169,000			39,618,000

Long term liabilities:
Finance leases payable, less current portion		36,000			32,000
Office leases payable, less current portion		470,000
Deferred revenue, less current portion		340,000			506,000

Total liabilities		33,015,000			40,156,000

Commitments and contingencies (Note 9)		-			-

Stockholders’ equity (deficit):
Preferred stock, $0.001 par value; 3,000,000 and 500,000 shares authorized at September 30, 2025 and June 30, 2025, respectively; none issued and outstanding		–			–
Common stock, $0.001 par value; 75,000,000 shares authorized; 16,862,010 and 16,835,698 shares issued and outstanding at September 30, 2025 and June 30, 2025, respectively		17,000			17,000
Additional paid-in capital		105,611,000			100,965,000
Accumulated deficit		(108,948,000	)		(106,386,000	)
Total stockholders’ equity (deficit)		(3,320,000	)		(5,404,000	)
Total liabilities and stockholders’ equity (deficit)	$	29,695,000		$	34,752,000


	Three months ended September 30,
	2025			2024
Revenues	$	13,175,000		$	16,125,000
Cost of sales		9,410,000			10,907,000

Gross profit		3,765,000			5,218,000

Operating expenses:
Selling and administrative		4,906,000			5,115,000
Research and development		1,037,000			1,315,000
Total operating expenses		5,943,000			6,430,000

Operating loss		(2,178,000	)		(1,212,000	)

Interest income (expense), net		(384,000	)		(457,000	)

Net loss	$	(2,562,000	)	$	(1,669,000	)

Net loss per share - basic and diluted	$	(0.15	)	$	(0.10	)

Weighted average number of common shares outstanding - basic and diluted		16,835,698			16,682,465

I		1		2		3		4			5
	Common Stock
	Shares		Capital Stock Amount		Additional Paid-in Capital		Accumulated Deficit			Total
Balance at June 30, 2025		16,835,698	$	17,000	$	100,965,000	$	(106,386,000	)	$	(5,404,000	)
Issuance of prefunded preferred stock warrants and common stock warrants under Private Placement, net of offering costs of $400,000		–		–		4,400,000		–			4,400,000
Issuance of common stock – ESPP		26,312		–		37,000		–			37,000
Stock-based compensation		–		–		209,000		–			209,000
Net loss		–		–		–		(2,562,000	)		(2,562,000	)
Balance at September 30, 2025		16,862,010	$	17,000	$	105,611,000	$	(108,948,000	)	$	(3,320,000	)

	September 30, 2025		June 30, 2025
Raw materials	$	12,321,000	$	13,471,000
Work in process		820,000		513,000
Finished goods		2,585,000		3,247,000
Total Inventories	$	15,726,000	$	17,231,000

	September 30, 2025		June 30, 2025
Warranty liability	$	3,259,000	$	3,377,000
Lawsuit settlements liability		2,175,000		2,175,000
Payroll and bonus accrual		1,616,000		1,024,000
PTO accrual		454,000		482,000
Total accrued expenses	$	7,504,000	$	7,058,000

	Number of Warrants		Weighted Average Exercise Price Per Warrant		Weighted Average Remaining Contract Term (# years)
Outstanding and exercisable at June 30, 2025		1,413,110	$	6.14
Issued		1,214,766		1.72
Exercised		–		–
Forfeited and cancelled		–		–
Outstanding and exercisable at September 30, 2025		2,627,876		4.10		2.95

		1			2
	Three months ended September 30,
	2025			2024
Cash flows from operating activities:
Net loss	$	(2,562,000	)	$	(1,669,000	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		251,000			252,000
Stock-based compensation		209,000			347,000
Amortization of debt issuance costs		37,000			41,000
Non-cash lease expense		122,000			160,000
Inventory write downs		6,000			134,000
Changes in operating assets and liabilities:
Accounts receivable		3,877,000			(297,000	)
Inventories		1,499,000			1,501,000
Other assets		(260,000	)		(97,000	)
Accounts payable		(2,556,000	)		(58,000	)
Accrued expenses		446,000			922,000
Accrued interest		10,000			19,000
Office leases payable		(200,000	)		(175,000	)
Deferred revenue		10,000			(152,000	)
Customer deposits		–			16,000
Net cash provided by operating activities		889,000			944,000

Cash flows from investing activities:
Purchases of equipment		(163,000	)		(198,000	)
Net cash used in investing activities		(163,000	)		(198,000	)

Cash flows from financing activities:
Proceeds from issuance of prefunded preferred stock warrants and common stock warrants under Private Placement, net of offering costs of $400,000		3,227,000			–
Proceeds from employee stock purchase plan purchases		37,000			–
Proceeds from subordinated debt borrowing		–			1,000,000
Proceeds from revolving line of credit		16,908,000			13,755,000
Payment of revolving line of credit		(20,600,000	)		(15,548,000	)
Cost to amend line of credit agreement		(113,000	)		–
Payment of finance leases		69,000			(37,000	)
Net cash used in financing activities		(472,000	)		(830,000	)

Net change in cash		254,000			(84,000	)
Cash, beginning of period		1,334,000			643,000

	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contract Term (# years)		Aggregate intrinsic Value		Weighted Average Grant Date Fair Value
Outstanding at June 30, 2025		796,660		$	4.10
Granted		536,660			1.88					$	1.23
Exercised		–			–			$	–
Forfeited and cancelled		(119,439	)		3.78
Outstanding at September 30, 2025		1,213,881			3.15		7.99		1,138,000
Exercisable at September 30, 2025		766,905			4.58		5.52		86,000

	Three months ended September 30,
	2025			2024 ⁽¹⁾
Expected volatility		95.46	%		-
Risk free interest rate		3.85	%		-
Dividend yield		–	%		-
Expected term (years)		5.87

	Number of Shares		Weighted Average Grant Date Fair Value
Outstanding at June 30, 2024		114,666	$	5.56
Granted		–		–
Vested and settled		–		–
Forfeited and cancelled		–		–
Outstanding at September 30, 2024		114,666		5.56

	Operating Leases			Finance Leases
Years ending June 30,
2026 (remaining nine months)	$	684,000		$	89,000
2027		433,000			21,000
2028		64,000			22,000
Total future minimum lease payments		1,181,000			132,000
Less: discount		(60,000	)		(6,000	)
Total lease liability		1,121,000			126,000
Less: leases payable, current portion		(651,000	)		(90,000	)
Leases payable, noncurrent portion	$	470,000		$	36,000

	●	increase battery life by optimizing the charging cycle,

	●	give users a better understanding of the health of their battery in use, and

	●	apply artificial intelligence to predictively balance the cells for optimal performance.

Fiscal Quarter Ended	Beginning Backlog		New Orders		Shipments		Ending Backlog
June 30, 2024	$	19,630,000	$	11,614,000	$	13,377,000	$	17,867,000
September 30, 2024	$	17,867,000	$	19,451,000	$	16,125,000	$	21,193,000
December 31, 2024	$	21,193,000	$	13,116,000	$	16,830,000	$	17,479,000
March 31, 2025	$	17,479,000	$	16,158,000	$	16,742,000	$	16,895,000
June 30, 2025	$	16,895,000	$	9,764,000	$	16,737,000	$	9,922,000
September 30, 2025	$	9,922,000	$	8,947,000	$	13,175,000	$	5,694,000

	(a)	the Company’s original estimate of the overstatement of inventories had risen due to additional excess and obsolete inventory identified related to inventory components not recorded at the lower of cost or net realizable value, as well as consigned inventory not reconciled in a timely manner;

	(b)	the Company had not properly recognized revenue in the periods in which the related performance obligations had been satisfied for a contract with a certain customer, and that the Company had improperly recorded accounts receivable pertaining to that contract as a reduction to its accounts payable owed to that customer although the right of offset conditions under ASC 210-20 had not been met, resulting in misstatements to revenues, accounts receivable and accounts payable;

	(c)	the Company had improperly recorded various inventory write downs to research and development expenses although such expenses did not meet the classification criteria for research and development under ASC 730, resulting in an overstatement of research and development expenses and a corresponding understatement of cost of sales;

	(d)	the Company had various clearing accounts that had not been reconciled in a timely manner, resulting in misstatements of accounts payable, inventories and cost of sales;

	(e)	the Company had not included certain product warranty-related expenses within the proper periods in its calculation of its product warranty reserve estimate, resulting in an understatement of accrued expenses, an understatement of accounts payable and an understatement of cost of sales; and

	(f)	the Company erroneously presented non-cash debt issuance cost incurred in conjunction with credit facility arrangements as a non-cash adjustment to reconcile net loss to net cash used in operating activities in the consolidated cash flow statements when such cost should have been recognized as a change in other assets.

Exhibit No.		Description
4.1		Form of Prefunded Warrant (PIPE). Incorporated by reference to Exhibit 4.1 to Form 8-K filed on September 16, 2025.
4.2		Form of Common Warrant (PIPE). Incorporated by reference to Exhibit 4.2 to Form 8-K filed on September 16, 2025.
10.1		Amendment No. 6 to Loan and Security Agreement (GBC). Incorporated by reference to Exhibit 10.1 to Form 8-K filed on September 5, 2025.
10.2		Amendment No. 5 to Loan and Security Agreement (GBC). Incorporated by reference to Exhibit 10.1 to Form 8-K filed on July 22, 2025.
10.3		First Amendment to Subordinated Unsecured Promissory Note. Incorporated by reference to Exhibit 10.2 to Form 8-K filed on July 22, 2025.
10.4		Form of Amended and Restated Securities Purchase Agreement. Incorporated by reference to Exhibit 10.1 to Form 8-K filed on September 16, 2025
10.5		Form of Registration Rights Agreement. Incorporated by reference to Exhibit 10.2 to Form 8-K filed on September 16, 2025.
10.6		Form of Escrow Agreement. Incorporated by reference to Exhibit 10.3 to Form 8-K filed on September 16, 2025.
10.7		Form of Debt Satisfaction Agreement. Incorporated by reference to Exhibit 10.4 to Form 8-K filed on September 16, 2025.
31.1*		Certifications of the Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act.
31.2*		Certifications of the Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act.
32.1**		Certifications of the Chief Executive Officer under Section 906 of the Sarbanes-Oxley Act.
32.2**		Certifications of the Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act.
101.INS*		Inline XBRL Instance Document- the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH*		Inline XBRL Taxonomy Extension Schema.
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase.
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase.

	Flux Power Holdings, Inc.

Date: November 13, 2025	By:	/s/ Krishna Vanka
		Krishna Vanka
		Chief Executive Officer
		(Principal Executive Officer)

Date: November 13, 2025	By:	/s/ Kevin S. Royal
		Kevin S. Royal
		Chief Financial Officer
		(Principal Financial Officer)

1.	I have reviewed this Quarterly Report on Form 10-Q of Flux Power Holdings, Inc.

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4.	The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

	a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

	c.	Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

	d.	Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

	a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

	b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Date: November 13, 2025

By:	/s/ Krishna Vanka
Name:	Krishna Vanka
Title:	Chief Executive Officer
	(Principal Executive Officer)

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.