Texas-based AYRO Inc. (AYRO) provides purpose-built, short-haul, and last-mile delivery electric vehicles (EV). AYRO launched its Club Car Current EV (Current) in June and has so far received purchase orders totaling $4.9 million for the product. Importantly, AYRO expects additional orders from Club Car as also Gallery Carts and Element Fleet management.
The company’s recent Q2 numbers were a mixed bag — missing on top-line but outperforming bottom-line estimates. Against this backdrop, let us take a look at the financial performance of the company and understand what has changed in its key risk factors that investors should know.
Revenue in the second quarter jumped 83% year-over-year to $522,067 but lagged consensus by $4.2 million.
The CEO of AYRO, Rod Keller, said, “Despite the growing demand and increased purchase orders, revenue was down slightly from the first quarter, mostly due to the Current being launched near the end of the quarter and given that we started manufacturing of the Current at Karma Automotive’s Innovation and customization Center in California for the first time.”
Its net loss per share at $0.22 was lower than the estimated net loss per share by $0.02. (See AYRO stock chart on TipRanks)
Further, the company expects to unveil its E-delivery vehicle, targeted at the U.S. restaurant delivery market, later in 2021 and estimates an official launch in the first half of 2022.
Now, let’s look at what has changed in the company’s key risk factors.
According to the new Tipranks’ Risk Factors tool, AYRO’s main risk categories are Legal & Regulatory and Ability to Sell, which accounts for 23% and 21%, respectively, of the total 56 risks identified. Since June, the company has added one key risk factor under the Production risk category.
AYRO highlights that the battery packs in its electric vehicles use lithium-ion cells, which can catch fire or vent smoke and flames if not managed properly. The company notes that if such an adverse event takes place then it could damage the vehicle, cause personal injury or death, and may further subject AYRO to lawsuits.
The company adds that any such damage or injury can lead to negative publicity and a potential safety recall, which will harm the company’s business, financial condition and operating results in the process.
The Legal & Regulatory risk factor’s sector average is at 17%, compared to AYRO’s 23%. Shares are up 25.5% over the past year.
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