Workhorse Group Reports Third Quarter 2025 Results (Form 8-K)

Workhorse Group Reports Third Quarter 2025 Results

CINCINNATI, November 10, 2025 - Workhorse Group, Inc. (Nasdaq: WKHS) ("Workhorse" or "the Company"), an American technology company focused on pioneering the transition to zero-emission commercial vehicles, today reported financial results for the third quarter ended September 30, 2025.

Management Commentary

"We continue to make important progress on our product roadmap at Workhorse," said Company CEO Rick Dauch. "We recently announced the availability of the Utilimaster Aeromaster body for our W56 Class 5/6 step van, designed to enhance the flexibility, durability, efficiency, and safety of the W56 platform. This exciting new offering will enable us to deliver the performance and reliability of our step van in the traditional form factor that fleet operators already know and trust. During the third quarter we completed the sale of 15 trucks, in a combination of both Class 4 and 5 versions."

Mr. Dauch added: "We are focused on completing our proposed transaction with Motiv to create a leading North American medium-duty electric truck OEM. By building on our complementary strengths, Workhorse and Motiv are positioned to win the medium-duty EV market as the long-term industry trend towards electrification continues. We are confident that this transaction will provide our shareholders with the opportunity to participate in the potential upside of the combined company, with a significant ownership stake."

Executing Strategic and Financial Actions

During the third quarter, Workhorse advanced its product roadmap to broaden W56 application options. This work included the completion of integration, testing and validation efforts for the industry-standard aluminum Aeromaster walk-in body from Utilimaster. The new configuration expands the proven capabilities of the W56 product line.

In connection with its proposed transaction with Motiv, Workhorse has benefitted from funding totaling approximately $25 million from Motiv's controlling investor, including a $20 million sale leaseback transaction and $5 million secured convertible note financing. At closing of the merger, which is expected in the fourth quarter of this year, all remaining indebtedness and other obligations to Workhorse's existing senior secured lender, including all warrants currently held by the lender, will be repaid and/or cancelled, with the only remaining secured indebtedness of the combined companies being the $5 million secured convertible note held by an affiliate of Motiv's controlling investor, which may convert to equity in connection with post-closing financing. The transaction with Motiv also includes a condition to closing that entities affiliated with Motiv's largest investor provide Workhorse with up to $20 million in debt financing at the closing.

Third Quarter Financial Results

Sales, net of returns and allowances, for the three months ended September 30, 2025 and 2024 were $2.4 million and $2.5 million, respectively. The decrease in sales of $0.1 million was primarily due to lower sales of approximately $2.3 million related to the sale of fewer trucks in 2025 compared to the same period in 2024, offset by an increase of $2.2 million related to the recognition of seven vehicles from deferred revenue.

Cost of sales for the three months ended September 30, 2025 and 2024 were $10.1 million and $6.6 million, respectively. The increase in cost of sales of $3.5 million was primarily a result of an increase in inventory excess and obsolescence reserve of $3.3 million.

Selling, general and administrative ("SG&A") expenses for the three months ended September 30, 2025 and 2024 were $7.8 and $7.7 million, respectively. The increase in SG&A of $0.1 million was primarily driven by a $3.6 million increase in consulting and legal expenses due to the proposed Motiv merger, offset by a $2.9 million decrease in employee compensation and related expenses, a decrease of $0.2 million in marketing and trade show related expenses, and a decrease of $0.3 million in IT-related expenses.

Research and development ("R&D") expenses for three months ended September 30, 2025 and 2024 were $1.1 million and $2.3 million, respectively. The decrease in R&D expenses of $1.2 million was primarily driven by a $0.3 million decrease in employee compensation and related expenses due to lower headcount, a $0.5 million decrease in prototype part expenses and a $0.3 million decrease in consulting and professional services expenses.

Interest expense, net for the three months ended September 30, 2025 and 2024 was $0.2 million and $3.0 million, respectively. The difference was primarily driven by higher financing fees related to the 2024 Notes recognized in the prior year period compared to current period.

As of September 30, 2025, the estimated fair value of the notes held by Workhorse's existing senior secured lender (the "2024 Notes") totaled $27.1 million and the estimated fair value of the Convertible Note from Motiv's controlling investor was $5.1 million. During the three months ended September 30, 2025, Workhorse's existing senior secured lender converted $19.0 million in principal into Common Stock, and the Company recorded a $1.4 million fair value net loss on conversion.

As of September 30, 2025, the estimated fair value of the warrants held by Workhorse's existing senior secured lender (the "2024 Warrants") totaled $10.0 million. For the three months ended September 30, 2025 and 2024, the Company recorded a net fair value loss of $6.8 million and $2.6 million, respectively, related to the 2024 Warrants.

During the three months ended September 30, 2025, the Company recognized a gain on sale of assets of $13.8 million primarily related to the Sale Leaseback of its Union City, IN Facility.

During the three months ended September 30, 2025, the Company recognized a gain of $4.8 million related to deferred revenue upon termination of the Tropos Assembly Services Agreement.

As of September 30, 2025, the Company had $12.7 million in cash and cash equivalents and $25.5 million in restricted cash, net accounts receivable of $1.2 million, other receivables of $1.5 million, net inventory of $30.0 million and accounts payable of $11.2 million.

The proposed transaction with Motiv includes a condition to closing that entities affiliated with Motiv's largest investor provide Workhorse with up to $20 million in debt financing at closing. Approximately $10 million is to be made available after the closing for general corporate purposes pursuant to a revolving credit facility, and $10 million is to be made available after the closing to fund vehicle manufacturing upon the receipt of confirmed purchase orders pursuant to an ABL facility. The terms of this financing have not been finalized.

Third Quarter Financial Overview

"Our proposed transaction with Motiv will provide Workhorse with a simplified capital structure and the near-term liquidity to support our operations through the proposed transaction close," said Workhorse CFO Bob Ginnan. "We continue to take additional steps to extend our financial runway and efficiently manage our cash flow by reducing operating costs and improving working capital needs. We are confident in our ability to generate additional purchase orders and revenue from our customers while strengthening our financial position, and we look forward to completing the proposed transaction with Motiv."

Conference Call

Workhorse management will hold a conference call tomorrow, November 11, 2025, at 10:00 a.m. Eastern time (7:00 a.m. Pacific time) to discuss these results and answer related questions.

U.S. dial-in: 877-407-8289
International dial-in: 201-689-8341

Please call the conference telephone number 10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Group at 949-574-3860.

The conference call will be broadcast live and available for replay here and via the Investor Relations section of Workhorse's website.

A telephonic replay of the conference call will be available after 1:00 p.m. Eastern time on the same day through November 18, 2025.

Toll-free replay number: 877-660-6853
International replay number: 201-612-7415
Replay ID: 13757041

About Workhorse Group Inc.

Workhorse Group Inc. (Nasdaq: WKHS) is a technology company focused on pioneering the transition to zero-emission commercial vehicles. Workhorse designs and builds its vehicles in the United States at the Workhorse Ranch in Union City, Indiana. The company's best-in-class vehicles are designed for last-mile delivery, medium-duty operations, and a growing range of specialized applications.

Additional Information and Where to Find It

Workhorse has filed with the U.S. Securities and Exchange Commission (the "SEC") a definitive proxy statement on Schedule 14A (the "Definitive Proxy Statement") and a proxy card with respect to its solicitation of proxies for Workhorse's 2025 Annual Meeting of Stockholders (the "Annual Meeting"). The Definitive Proxy Statement contains important information about the matters to be voted on at the Annual Meeting. STOCKHOLDERS OF WORKHORSE ARE URGED TO READ THESE MATERIALS CAREFULLY AND IN THEIR ENTIRETY (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS THAT WORKHORSE HAS FILED OR WILL FILE WITH THE SEC BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT WORKHORSE AND THE MATTERS TO BE VOTED ON AT THE ANNUAL MEETING. Stockholders are able to obtain a free copy of the Proxy Statement and other relevant documents once such documents are filed with the SEC from the SEC's website at www.sec.gov, or by directing a request by mail to Workhorse Group Inc., 3600 Park 42 Drive, Suite 160E, Sharonville, Ohio 45241, or from the Workhorse's website at www.ir.workhorse.com.

Participants in the Solicitation

Workhorse and certain of its directors and officers may be deemed to be "participants" in the solicitation of proxies in respect of the matters to be considered about the Annual Meeting. Information concerning the directors and officers of Workhorse and interests of the persons who may be considered "participants" in the solicitation is set forth in Amendment No. 1 to Workhorse's Annual Report on Form 10-K for the year ended December 31, 2024, including under the headings "Item 10. Directors, Executive Officers and Corporate Governance", "Item 11. Executive Compensation", "Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters" and "Item 13. Certain Relationships and Related Transactions, and Director Independence", filed with the SEC on April 30, 2025, and available at https://www.sec.gov/ix?doc=/Archives/edgar/data/1425287/000121390025037631/ea0239686-10ka1_workhorse.htm. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement and other relevant materials to be filed with the SEC regarding the proposed transaction when such materials become available. Investors should read the proxy statement carefully when it becomes available before making any voting or investment decisions. Copies of these documents can be obtained, without charge, at the SEC's website at www.sec.gov, or by directing a request to Workhorse at the address above, or at www.ir.workhorse.com.