Enovix (ENVX -19.66%), a developer of advanced silicon-anode lithium-ion battery technology, released results for its second quarter of fiscal 2025 on July 31, 2025. The company posted GAAP revenue of $7.5 million, surpassing the analyst consensus estimate of $5.57 million (GAAP) and exceeding its own guidance midpoint. Its non-GAAP net loss per share came in at $0.13, outperforming expectations for a non-GAAP loss of $0.19 per share. The period showed material improvement in gross margin, reaching 31% (non-GAAP) versus (15%) in Q2 2024, while operating losses continued to narrow. Overall, the quarter featured strong commercial progress on battery platforms, manufacturing milestones in Asia, and a notable beat across key financial metrics.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (Non-GAAP) | $(0.13) | $(0.19) | $(0.13) | 0.0% |
| Revenue (GAAP) | $7.5 million | $5.57 million | $3.8 million | 97.4% |
| Revenue vs. Guidance Midpoint (GAAP) | $7.5 million vs $5.5 million midpoint | |||
| Gross Margin (Non-GAAP) | 31% | (15)% | 46 pp | |
| Operating Loss (Non-GAAP) | $(26.5 million) | $(31.5 million) | -15.9% |
Source: Analyst estimates for the quarter provided by FactSet.
Business Overview and Key Areas of Focus
Enovix develops and manufactures next-generation lithium-ion batteries with a focus on advanced silicon-anode technology. Its batteries are aimed at applications that demand higher energy density, faster charging, and longer cycle life, such as smartphones, smart eyewear (augmented reality), industrial handhelds, and devices used in the Internet of Things (IoT) sector.
Enovix’s business strategy centers on five main areas: innovating battery architecture, developing a proprietary manufacturing process, expanding through strategic acquisitions like its recent Korean facility, building a global manufacturing footprint in Asia, and targeting high-growth opportunities in consumer electronics, defense, and industrial applications. Its ability to achieve large-scale production, secure key certifications, and rapidly move from pilot to volume manufacturing has become a core measure of its current progress and future prospects.
Quarter Highlights: Financial and Operational Developments
The quarter’s biggest financial headline was the leap in GAAP revenue, which nearly doubled compared to Q2 2024, coming in substantially ahead of both internal guidance and analyst estimates. This jump was underpinned by strength in defense product sales manufactured at its Korean subsidiary. The higher share of these premium-margin products contributed to a turn in gross margin, with the company’s non-GAAP gross margin moved from negative values in Q2 2024 into the low 30% range. Company management confirmed this was a direct result of the Korean facility’s output, along with improvements in product mix following post-tariff shifts in customer demand.
Operating losses continued to narrow as the company increased sales and maintained cost controls. On a non-GAAP basis, operating loss improved from $(30.96 million) in Q2 2024 to $(26.51 million) in Q2 2025. Adjusted EBITDA, a measure of profit that removes the effects of interest, taxes, depreciation, and amortization, improved from minus $25.89 million in Q2 2024 to minus $20.13 million. However, cash flow remained negative, with free cash flow (non-GAAP) for the first half of FY2025 at $(67.0 million), an improvement over the prior year’s six-month result.
Product innovation featured heavily, especially with the launch and sampling of the AI-1 platform -- a new family of lithium-ion batteries that pairs silicon anodes with advanced manufacturing methods. Enovix announced its first smartphone battery with energy density over 900 watt-hours per liter (Wh/L). This product also achieved fast charging at 3C (meaning the battery can be charged in about 20 minutes) and a projected cycle life of 1,000 cycles. The AI-1 platform is being sampled with two major smartphone manufacturers, a leading smart eyewear company (augmented reality glasses), and several IoT-focused customers.
On the manufacturing front, the company’s new Fab2 site in Malaysia reached early production, producing AI-1 batteries on high-volume equipment. This, combined with further integration of its recently acquired Korean facility, allowed Enovix to accelerate customer qualification and halve the time required for custom product development. A key regulatory milestone was also met: Enovix obtained UN38.3 certification, which is required for batteries to be shipped safely by air worldwide. This clears the way for broader commercial shipments once customer qualifications are finished.
The acquisition of the Korean facility, formerly Routejade, served two purposes: it gave Enovix both vertical integration (control of more manufacturing steps, including electrode coating) and immediate access to new, high-margin defense contracts in the Asian market. Management stated that the acquisition came at a “bargain price” and significantly improved manufacturing capabilities, including supporting prototyping and production for new materials in as little as seven weeks. The Korean site also helped support the company’s defense product mix, which was a major driver of higher margins this period.
There were no declared or adjusted dividends for the period. The company instead moved forward with capital measures designed to strengthen its balance sheet, including a special warrant dividend program that could raise up to $255 million and an authorization for a $60 million share repurchase, which had not begun as of July 30.
Looking Ahead: Guidance and Focus Areas
For Q3 FY2025, Enovix guided to GAAP revenue between $7.5 million and $8.5 million. It expects a non-GAAP operating loss between $31 million and $35 million, and a non-GAAP net loss per share of $0.14 to $0.18. These outlook figures reflect continued investment in scaling manufacturing and entering new commercial agreements, but also suggest ongoing operating losses as the business ramps. Cash and investments (GAAP) at the end of Q2 2025 stood at $203.4 million.
Key factors for investors to watch in the coming quarters will be the rate at which sample shipments convert into volume purchase orders, especially with leading smartphone and smart eyewear customers. There is some risk that current high margins -- which benefited this quarter from a favorable defense mix -- may moderate as the business scales in larger consumer segments that historically feature lower margins. Management commentary confirmed that battery costs as part of bill of materials are rising, particularly as manufacturers raise capacity to meet growing demands from artificial intelligence (AI) hardware. The authentication of its technology in mass-market devices, and its ability to contain costs during the scale-up of production lines in Malaysia and Korea, will be critical to tracking progress.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
