Worksport (WKSP -10.98%) reported fiscal Q2 2025 results on August 13, 2025, delivering record quarterly revenue of $4.1 million, up 114% year over year. Gross margin improved to 26.4%, an increase of nearly 800 basis points. Management reaffirmed its revenue target of at least $20 million for fiscal 2025, highlighted the upcoming launch of new high-margin products, and projected operating cash flow breakeven by late Q4 2025 or early Q1 2026, positioning the company for near-term profitability and further scalability.
Record sales and margin gains propel Worksport expansion
The tonneau cover division accounted for all current revenue, but new product segments are expected to contribute starting in fiscal Q4 2025. Operating expenses remained essentially flat compared to the prior quarter despite significantly higher revenues, and inventory levels were stable at $5.88 million, with demand outpacing production.
"Net sales reached $4.1 million, representing a 114% year-over-year growth compared to $1.92 million in 2024 and an 83% sequential increase from 2025. This growth was driven by the continued ramp-up of our flagship AL4 premium tonneau cover, expanding dealer adoption and order frequency, and sustained strength in e-commerce sales across our direct-to-consumer channels. Gross profit for the quarter rose 173% to $1.8 million compared to $396,000 in 2025. Gross margin improved under 800 basis points to 26.4%, up from 17.7% in Q1 and 15.4% in Q2 of last year, marking our third consecutive quarter of market margin expansion. This sustained improvement reflects continued operational efficiencies and a favorable mix of new B2B and B2C sales."
-- Michael Johnston, CFO
Worksport’s margin trajectory and strong sales momentum demonstrate operational leverage and channel diversification, reducing execution risk against breakeven and growth targets while highlighting a scalable model that can absorb further volume without proportionate cost escalation.
Dealer network growth accelerates Worksport’s addressable revenue
The dealer network expanded by over 450 accounts year to date as of fiscal Q2 2025, up from 94 at the end of the previous year, supported by the addition of two national distributors. At current levels, network capacity supports more than $21.5 million in potential annual B2B revenue, excluding direct-to-consumer e-commerce sales.
"In Q2 2025, we added two national distributors to our dealer network. In April, we added Patriot Auto Group, which brought with them 200 dealers under the Worksport dealer network. In June, we added another national distributor with access to approximately an additional 250 dealer accounts. At full activation, Worksport estimates that our distribution network as of Q2 can support over $21.5 million in repeatable annual revenue alone, not including business-to-consumer direct sales via our online platforms. Driven by ongoing B2B traction and demand for our premium American-made tonneau."
-- Steven Rossi, CEO
This rapid increase in B2B network scale significantly broadens Worksport’s baseline revenue potential, improves recurring sales visibility, and strengthens its position for both organic and future product-driven growth initiatives.
Clean energy product pipeline positions Worksport for 2026 profitability inflection
Early pilot adoption by a U.S. construction agency and substantial inbound corporate and government interest in AetherLux highlight strong market receptivity to the clean energy portfolio. TerraVise Energy, a Worksport subsidiary, advanced AetherLux from lab to commercial testing and began manufacturer selection for product certification in fiscal Q2 2025.
"Core and Solis together function as Worksport's portable nano grid. In 2025, this system was selected by a multi-dollar US construction agency for a pilot project for fleet use. Testing and use are ongoing. Together, Core and Solis position Worksport within the fast-growing broader portable energy market, a space the company believes will be a key to long-term profitability. A little bit about AetherLux. On February 11, 2025, we introduced AetherLux, a cold climate heat pump featuring two industry-first innovations. First, zero frost, no defrost cycles. Continuous operation without the traditional defrost interruptions that reduce efficiency in freezing conditions. And ultra-low temperature performance. The Aetherlux operates in ambient temperatures as low as negative 59.6 degrees Fahrenheit, which is about 51 degrees Celsius. Far beyond the capabilities of typical commercial heat pumps, enabling its use in extreme arctic environments. Since the launch of AetherLux, we have attracted significant interest from major global corporations, federal governments, and numerous distributors with inbound inquiries potentially surpassing hundreds of millions of dollars in revenue opportunities. In Q2 2025, TerraVise Energy, our subsidiary company, had achieved numerous milestones on this disruptive technology. It has advanced Aetherlux heat pumps from lab testing to commercial testing, initiated manufacturer selection for product certification, continued R&D optimization of Zero Frost technology, and began evaluating strategic business opportunities. Management believes Aetherlux could have a meaningful impact on Worksport's 2026 balance sheet supported by its position in the $123 billion global market."
-- Steven Rossi, CEO
The imminent commercialization of proprietary clean energy products diversifies Worksport’s revenue streams, accelerates the pathway to profitability in 2026, and establishes the company as a differentiated player at the intersection of automotive and portable energy markets.
Looking Ahead
Management reaffirmed its full-year 2025 revenue target of at least $20 million and projects operating cash flow breakeven by late Q4 2025 or early Q1 2026. AetherLux is anticipated to deliver a meaningful positive financial impact in 2026, with more detailed forecasts forthcoming in Q4 2025. The ongoing Regulation A offering may fully fund operations through the remainder of 2025 and into 2026, with future capital needs expected to be met through existing warrants or non-dilutive financing.
