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Ladies and gentlemen, greetings and welcome to the Workhorse Group Q1 2026 earnings call. At this time, all participants are in the listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone requires operator assistance during the conference call, please signal an operator by pressing star and zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host for today, John Williams, Chief Communications Officer. Please go ahead.

Thank you, operator, and good afternoon, everyone. I would like to welcome all of you to our Q1 2026 earnings call. Before we begin, I'd like to note that we have posted our results for the Q1 ended March 31, 2026 via press release in Form 8-K. We filed our associated quarterly report on Form 10-Q with the SEC. You can find the release and an accompanying presentation in the investor relations section of our website. We will be tracking along with the presentation during this call. Joining me on today's call are Scott Griffith, our Chief Executive Officer, and Bob Ginnan, our Chief Financial Officer. For today's agenda, please turn to slide three. Following my opening remarks, I will hand it over to Scott, who will provide an update on our operational and commercial progress and the strategic priorities we are focused on.

Bob will then walk us through our financial results for the quarter and our capital position. Scott will then make closing remarks before we open the call for questions. Our cautionary statements can be found on slide four. Some of the comments that will be made today are forward-looking statements, which are based on current expectations, projections, or opinions about future periods. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. Some of these risks and uncertainties are discussed in today's press release and in our filings with the SEC, including our Form 10-K. Now, I will turn it over to Scott.

Thanks, John. Good afternoon, everyone. Thank you for joining us. On our last call, I outlined three commitments we made at the close of the merger. Complete the integration, expand our product portfolio. Strengthen our financial position. The Q1 was about translating those commitments into measurable progress. The early read on what we've accomplished confirms our approach and execution are on target. Let's dig into those. Starting with integration, the combination of Workhorse and Motiv is on track. Our facility aggregation is complete. The relocation of the Motiv production line into our Union City, Indiana plant is progressing as expected. We now have three production lines operating in Union City. In addition to the W56 step van line, we've begun builds on the new F59 chassis line. Our EPIC4 production line has also been successfully integrated into Union City.

Hardware and software platform commonization continues across the engineering organization. Supply chain optimization is underway, and we are systematically winding down our external integration support and the interim transition team that supported our early integration efforts. We're also making exciting progress on our product development plans and activities. During the quarter, we made strong progress on further detailing and executing our product vision. In a few minutes, I'll come back to this topic to talk more about two new product initiatives which are focused on the development of a next generation chassis and powertrain, as well as the coming launch of our first Class 5/6 cab chassis. We've also continued the simplification of our capital structure that began at close, and as Bob Ginnan will also describe, we strengthened our liquidity position with incremental borrowing to support production for the orders we have in hand.

We resolved two previously disclosed legal matters that had created overhang and distraction for the company, including the Coulomb Solutions matter that we resolved through a settlement agreement in April. Again, Bob will walk you through the financial details. The cost discipline that the team is applying across the combined organization is evident in the early read on synergy capture, which Bob will also detail. We continue to expect to exit 2026 at our previously communicated $20 million in annualized cost synergy run rate. In short, I'm pleased to report we are continuing to deliver on our commitments, controlling what is controllable and positioning Workhorse for sustained growth. As we are now almost midway through the Q2, I'd like to reflect on the many recent conversations I've had with current and potential customers, industry and financial analysts, and partners about the overall state of the market.

I've been struck by the consistency of their feedback, in particular, when I compare it to the ongoing questions about whether or not we've proven product market fit for EVs in our category. Frankly, to those who keep lingering on the question of product market fit, I believe you're focused on the wrong question. Let me explain. For the most part, in the medium duty sector, we believe it's clear that today's electric trucks, shuttles, and buses are meeting the moment. The strongest use cases, including mid-mile logistics, last mile delivery, municipal fleets, school buses and shuttles, and yard operations are now moving from questions around proof of concept and product market fit to scale deployment.

This is due primarily to the duty cycle of these early adoption applications and use cases which have short and predictable routes that return to a depot for lower cost overnight charging. Have lots of low speed start-stop driving that maximizes regenerative braking, further extending range and lowering total cost of electricity. Publicly reported data also emphasizes how far we are moving beyond questions of product market fit. For example, battery electric vehicle registrations in the medium and heavy-duty commercial truck segments grew 21% in 2025, with medium-duty delivery vans setting a new sales record. Fleets running those vehicles are already reporting total cost of ownership advantages versus the trucks they replaced, according to the State of Sustainable Fleets 2026 market brief.

The largest logistics operator in the world, Amazon, has deployed more than 30,000 all-electric Rivian vans, with announced plans to more than triple that amount in the near future. In a plenary session at ACT Expo last week, Amazon's head of fleet business development stated plainly that the business case for electrification is solid and that Amazon intends to continue. Other major logistics operators including Purolator, Cintas, UPS, and the FedEx delivery network are committing at scale. These trends are borne out in our own sales success so far in 2026. In the Q1, Workhorse announced two major purchase orders. Purolator, a long-standing customer, completed their fourth order from us. The PO is for 100 new step vans and will more than double the existing number of Workhorse vehicles already in their fleet.

Their continued orders from us reflects the quality of our vehicles, TCO success, and the service levels we're providing. We also announced a 100-unit purchase order from Gateway Fleets through our long-standing dealer, Kingsburg Truck Center. Gateway is a California-based provider of bundled electric vehicle and charging solutions for commercial delivery operators. Their lease-based model, which packages the truck, the charging infrastructure, fleet support, and depot access in a single offering, is a great example of how the EV ecosystem is maturing to accelerate adoption of electric trucks. Importantly, this model eliminates the upfront costs of vehicles and charging infrastructure, a barrier to adoption for some. We continue to have success selling our W56 step vans to small businesses who are independent service providers contracted with FedEx for last-mile package delivery.

In fact, we now have 75 vehicles either deployed or on order for near-term delivery to ISPs operating in several states. In summary, the data is telling us it's no longer a question of if EV trucks work in large segments of the medium-duty commercial truck market. Rather, it's now a question of when do we move past the tipping point to a time when software-defined all-electric medium-duty trucks are the norm, not the exception. The question everyone should be asking is, what is it gonna take to get the industry to that tipping point? Well, the data suggests we've already proven the case for EVs on a total cost of ownership basis. In fact, the data from Stables by Workhorse, an independent service provider contracted with FedEx that we own and operate, tells a powerful story.

In 2025, our Stables operation delivered nearly 560,000 packages over nearly a quarter million miles. It's a real-world test bed, not only of our technology, but of the comparative cost of operations. Last year, in that fleet, we spent more than $76,000 on gas for our ICE trucks. We spent a little more than $10,800 to power our electric trucks. On a per mile basis, that translated to about $0.53 per mile for ICE trucks and a little more than $0.10 per mile for EVs. That was before the conflict in Iran and a refinery accident in Ohio, which both happened earlier this year. Using today's gas prices and electricity prices in Ohio, the cost gap widens to $0.73 per mile.

Apply that math to a fleet of 20 vehicles, that fleet would save $220,000 alone on fuel over the course of a year. That's a significant savings in a business with extremely tight margins. This analysis does not include additional savings from maintenance like oil changes or increased uptime because EVs need less service than ICE vehicles. With demonstrated TCO savings continuing to make the case for electric trucks on an operating basis, what remains is to get the entry price more competitive with ICE. We believe that's what we will drive the tipping point. I'll spend a few minutes discussing what we've already done to accomplish exactly that, as well as where we're headed. During Q1, we announced a new version of our popular W56 step van.

This new version offers a 140 kilowatt battery that provides a sufficient range for many of our last mile delivery customers, but at a lower sticker price. Response to this new offer has been strong and will be reflected in future financial disclosures. We also announced significantly reduced promotional pricing on our 210 kilowatt step van, a key factor in Gateway Fleets' decision to purchase 100 W56s. These data points have convinced me that focusing on closing the price gap with ICE as quickly as possible will increase the adoption of our vehicles in many of the largest and most important commercial fleets in North America. How do we continue to narrow the gap between ICE and EV price points?

While I'm pleased to progress on cost reduction through synergies resulting from the merger, the reality is that such savings only go so far. To achieve the kind of breakthrough cost reduction needed to compete with ICE requires fundamental structural changes in hardware and software, as well as strategic use of global supply chain. Toward that end, today I'm announcing we're developing a plan for a new proprietary modular chassis design that will be produced exclusively at our Union City manufacturing plant. The new chassis design will be based on the foundational learnings gathered from proven W56 components, but with a scalable architecture that supports flexible wheelbase configurations, advanced battery and axle technologies, and next-generation software and power electronics. This approach includes the standardization of both hardware and software systems, enabling us to build a broad portfolio of vehicles in an extremely cost-efficient manner at a low volume.

While we're moving forward very aggressively to begin tests and validation of this groundbreaking design later in 2026, with initial production expected in early 2027. I'm also pleased to announce we've developed a plan for our first Class 5/6 cab chassis, which will pair with our innovative new modular chassis with a lightweight, low-cost cab design for efficient upfitting. The result will be a greater payload capacity, faster time to market, and a price point and total cost of ownership that compares very well with ICE alternatives. As with the new modular chassis, our engineering team is planning to begin tests and validation of this revolutionary platform that spans application across all classes of medium-duty trucks in 2026, supporting a planned start of production for the cab chassis platform in early 2027.

The combination of a combined modular chassis and the Class 5/6 cab chassis will enable us to not only offer fully electric software-defined trucks that should compare well with ICE economics, but also appeal to a wider segment of the total addressable market through a broader product portfolio. We believe these actions will bring us to the tipping point I referred to earlier, and I'm looking forward to reporting our progress each quarter and in between as we bring this exciting vision and product strategy to life. In the meantime, we continue to take steps to not only take care of our current customers, but plan for future expected growth. Last week, we announced our plans for scalable customer support across our North American network of trucks through a combination of national dealer relationships, internal capabilities, and a partnership we announced with InCharge Energy.

When the program launches later this year, Workhorse fleet customers will have access to live specialists to simplify support by giving fleets one accountable entity to navigate matters that span Workhorse vehicles, charging infrastructure, electrical systems, and third-party hardware and software. Fleet electrification is still relatively early in the adoption cycle, so when technical issues arise, it isn't always obvious where the culprit lies. Sorting that out quickly requires genuine expertise in both vehicle and charging ecosystem around it. InCharge's deep knowledge of EV charging hardware and software is a real asset in helping Workhorse customers find and resolve the root cause faster. This industry-first partnership is a key aspect of our plan to deliver scalable, first-call service operations and provide large fleets with what they value most, high uptime. Major fleet operators expect not only a great truck at a competitive cost, but also OEM-grade customer service.

We believe our ability to offer such a combination will be an important part of how we win and retain the largest fleet operators in North America. In summary, we're executing against the commitments we made at close, integration is on track, pricing actions are converting into orders, and we have a cleaner operational foundation than we had 90 days ago. We have developed what we believe is a clear and achievable plan to deliver purchase price and TCO metrics that favor EVs over ICE trucks. I look forward to reporting on our progress in the coming months. With that, let me hand it over to Bob to walk you through the financial details. Thanks, Scott, good afternoon, everyone. Before walking through the numbers, I want to set context.

Our consolidated results for the Q1 of 2026 reflect 3 full months of the combined Workhorse and Motiv operation. Comparative information for the Q1 of 2025 reflects only Motiv, the accounting acquirer in the reverse merger. As a result, certain year-over-year comparisons are not on a like-for-like basis, and where helpful, I will reference combined comparisons consistent with the disclosures in our 10-Q so that you have the right reference point. Revenue for the Q1 of 2026 was $4.3 million compared to $1.1 million in the Q1 of 2025. We delivered 21 vehicles in the quarter compared to 5 vehicles in the prior year period. As Scott noted, the majority of our Q1 deliveries were W56 step vans, consistent with the demand patterns and the customer base we serve.

Cost of sales for the Q1 was $11.8 million compared to $2.2 million in the prior year, resulting in a gross loss of $7.5 million for the quarter.

Costs in the Q1 were higher, driven primarily by higher sales volume and the change in cost structure, where we now operate our own manufacturing facility versus last year when Motiv operated with contract manufacturers. In addition, we recorded a $1.5 million warranty charge, which was primarily attributable to costs related to a retrofit campaign that is underway for certain Motiv trucks previously sold in Canada. Costs incurred during the quarter for the retrofit campaign were higher than our original estimates, and we increased our reserves required for its completion.

On a structural basis, cost of sales reflects the higher fixed cost base of the combined manufacturing footprint relative to the Motiv-only prior year period, as well as the temporary cost of winding down the contract manufacturing run under the legacy Motiv operating structure in Q1, which exits in the Q2 as we complete the consolidation of production at Union City. We continue to expect gross margin to improve as we scale production volumes in our Union City facility and realize the cost benefits of the combined platform. Selling, general, and administrative expenses were $9.5 million in the Q1 of 2026 compared to $4.3 million in the Q1 of 2025.

The year-over-year increase was driven primarily by the inclusion of the full combined company cost base in 2026 compared to only Motiv in the prior year period. We also spent $900,000 in merger integration projects in the quarter. Research and development expenses were $4.1 million in the Q1 of 2026 compared to $3.7 million in the Q1 of 2025. The increase was due to higher employee costs as we make strategic R&D investments, primarily our initiative to lower the total bill of material costs of our vehicles to be in line with ICE. With these results, we believe that we are on track to achieve the synergy targets that we have previously outlined.

Loss from operations was $21.1 million in the Q1 of 2026 compared to $9.9 or $9.1 million in the Q1 of 2025. Net loss for the quarter was $19.9 million or $0.99 per basic and diluted share, compared to a net loss of $12.7 million or $1.36 per share in the prior year. The net loss for the quarter includes a $1.7 million gain on the change in fair value of stock rights, which is non-cash and non-operating in nature. Turning to the balance sheet, subsequent to quarter end, we have meaningfully strengthened our liquidity position to support production for the order pipeline Scott described.

On April first, we drew $7.3 million under the customer order credit agreement, bringing the total outstanding to $12.3 million. In April, we also amended our credit agreement with our lender, increasing the borrowing capacity under our cash flow agreement to $20 million and decreasing the borrow capacity under our customer order credit agreement to $30 million to adjust to the maximum level we expect to need at any point in time for the foreseeable future. Following the amendment, we drew an additional $10 million under the cash flow credit agreement. As of the filing date of our 10-Q, we had $17.7 million available to borrow under the customer order credit agreement.

In addition to the credit agreement activity, in April, we entered into a settlement agreement to resolve the previously disclosed Coulomb Solutions, Inc. litigation, which provides for the dismissal of the matter in exchange for a payment of $4.3 million. We expect to fund the settlement payment through borrowings under our customer order credit agreement. With this settlement of this matter, together with the resolution of one other previously disclosed legal item, we have removed two long-standing legacy overhangs in the period. We are continuing to actively evaluate financing alternatives to support our growth plan. Consistent with the framing we provided last quarter, we will share additional details as they become available.

While we are not providing specific financial guidance at this time, we expect deliveries to increase over the course of 2026 as we ramp production at the Union City facility and convert our growing pipeline of orders into revenue. With that, let me turn it back over to Scott for closing remarks. Thanks, Bob. I'd like to end where I began. The opportunity in front of us hasn't changed. We believe a large underserved commercial vehicle market is nearing the tipping point of an electric transition. We have the facilities and production capacity to scale to profitable volumes. We have a sales strategy focused on the customers and geographies most likely to adopt at scale. We're continuing to strengthen our team, our balance sheet, and our operational platform to fund the journey.

Ultimately, we believe we're well-positioned in the category to deliver on both of the key drivers of the tipping point to electrification of medium-duty segment, ICE comparable economics and professional, scalable post-sale support. We believe the revised product priorities and product development roadmap I walked through today will address the need to deliver comparable economics and our new partnership with InCharge Energy, combined with the ongoing learnings from our existing customers and our data from our own operations, our FedEx Ground ISP, put us in a great position to solve the second. We appreciate your continued support, and we look forward to updating you on our progress in the months ahead. Operator, you may now open the lines to questions.

Ladies and gentlemen, we will now begin the question and answer session. To ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Ladies and gentlemen, we will wait for a moment while we poll for questions. Our first question comes from Benjamin Sommers with BTIG. Please state your question.

Good afternoon, guys, and thanks for taking my question. First, I wanted to ask on the promotional pricing. You know, I guess I'm just curious what has been the preliminary demand response here, and how do you plan to incorporate or initiatives like this into the longer term business strategy?

Hey, Ben. Great question. This is something that I really think a lot about. First, I wouldn't say it was a test. I think we're ready to start running these types of promotional pricing. While it's set up as a temporary price change, I think it's indicative of the direction we have been talking about, and we spend a lot of time on this call talking about these prices have to decline as our BOM structure and our cost structure declines. We'll continue to do that. I think of what we just did as sort of step 1 of N steps. I don't know how many steps there'll be, but as we make more progress on cost reduction, we continue to ladder that price down as the plan.

You know, think of annual changes, not probably much more frequently than that, but we have a plan going forward. The new things like that new modular chassis I talked about, that really is a game-changing cost improvement for us. As we launch those kinds of initiatives, new batteries along with those, you'll see us take pricing actions along the way. What the response was your real question. Candidly, I don't think the Gateway order would have happened without that promotional pricing. That was in part why they decided to go ahead and make a move. It's not just Gateway, it's the customer they serve. They're really serving small businesses that are almost exactly what we're doing near Cincinnati in our own FedEx ISP.

We're very familiar with the price sensitivity of those operations. These are very thin margin small business operators, who are paying drivers that own one truck, and they own the trucks, and they're very price sensitive. And by the way, that's a big chunk of the FedEx Ground business. There's about, I don't remember exactly off the top of my head, but I think there's, Bob, help me out. There's, you know, tens of thousands of FedEx trucks that fit into that ISP. You know, it's probably close to 60,000, I think.

Probably close to 90,000.

90,000. Sorry. That includes the both sides of it. There's 90,000 trucks out there in the hands of ISPs, these independent operators that in a very price sensitive setting like this. That's why we're taking these actions, and that's how something like Gateway really makes a difference 'cause they bring in a bundled offering that is a truck, you know, the energy, the charging system, and the financing around that without all the upfront costs that small businesses often can't pony up. It's a real game changer for us to have both, you know, a Gateway type partner and the right price in the market.

Super helpful. My second question, you know, you guys did a great job laying out the data points for, you know, the rising fuel costs and the impact that has on the affordability of, you know, electric fleets. I'm just kinda curious, you know, if this has come up at all in conversations with customers yet and just kind of, you know, potentially how quick that impact of the rising fuel costs has maybe, you know, trickled into the demand for Workhorse's products. Thank you.

Another great question. I think, you know, we wanna be good, and sometimes we get lucky. Honestly, while no one wants to see high gas prices, it is helping the business. I wouldn't say we've received any hard orders because of the price change yet. I'd say the inbound queries and the number of people really kind of penciling and doing the math now around this high gas price has gone way up in the last 30 to 60 days. I expect that's gonna start to translate into orders. Can't make any promises, but, you know, the phone's certainly ringing with a lot of questions around this right now.

Super helpful. Thank you guys for the update, and thanks for taking my questions.

Thanks, Benjamin. With that, I'll turn it back to Scott Griffith for the closing comments.

Once again, thanks everyone for joining us today. On behalf of Bob and the rest of the executive team, we appreciate the questions, and your continued interest in Workhorse. It's obviously a really dynamic, exciting time for us, and we'll look forward to seeing you on the next earnings call and talking about our continued progress.

Ladies and gentlemen, the conference call of Workhorse Group has now concluded. Thank you for your participation. You may now disconnect your lines.

Please note this conference is being recorded. I will now turn the conference over to John Williams, Chief Communications Officer. Thank you. You may begin.

Thank you, operator, and good afternoon, everyone. I'd like to welcome all of you to Workhorse's Q4 and full year 2025 earnings call. Before we begin, I'd like to note that we have posted our results for the Q4 and full year ended December 31, 2025 via press release in Form 8-K and filed our associated annual report on Form 10-K with the SEC. You can find the release and an accompanying presentation in the investor relations section of our website. We will be tracking along with the presentation during this call. Joining me on today's call are Scott Griffith, our Chief Executive Officer, and Bob Ginnan, our Chief Financial Officer. For today's agenda, please turn to slide 3. Following my opening remarks, I will hand it over to Scott, who will give you an overview of the combined company and our strategic priorities.

Bob will then walk us through our financial results for the quarter and full year, as well as our capital position. Scott will then close us out before we open up the call for questions. Our cautionary statements can be found on slide four. Some of the comments that will be made today are forward-looking statements, which are based on current expectations, projections, or opinions about future periods. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. Some of these risks and uncertainties are discussed in today's press release and in our filings with the SEC, including our Form 10-K. Now, I'll turn it over to Scott.

Thanks, John. Good afternoon, everyone, and thank you for joining us. This is a milestone moment for Workhorse, our first earnings report as a combined company following the completion of our merger with Motiv Electric Trucks in December 2025. Before I get into the substance of what we've accomplished and where we're headed, let me briefly introduce myself for those I haven't yet had the chance to meet. I came to Workhorse through our merger with Motiv, where I served as Chief Executive Officer. Before that, I spent much of my career building and scaling technology-driven transportation businesses, including operating and board roles at Ford, EVgo, Zipcar, Boeing, and TrueMotion. I took on this role because I believe Workhorse has the right products, the right customers, and the operational foundation to build a profitable scale business in the medium-duty commercial truck market.

I've seen what it looks like when the technology is right, the market is ready, and the execution is focused. That's where we are. Let me start with what Workhorse is today. The new Workhorse is a leading North American medium-duty commercial vehicle OEM with a portfolio spanning classes four, five, and six . We bring more than 20 years of combined operating experience, more than $860 million in previously invested capital, and a growing presence in the $23 billion North American medium-duty truck market. The proof of our platform is on the road. Our vehicles operating in customer fleets have now surpassed 20 million real-world miles across more than 1,100 vehicles deployed with some of the largest commercial and public sector fleets in North America. These are not test vehicles.

These are trucks in daily service, running delivery routes, generating real operational data through our embedded telematics platform and delivering consistent documented results. We serve 10 of the largest medium-duty commercial truck fleets in North America, and we continue to see a repeat purchase behavior, which we believe is a strong signal of customer satisfaction in this market. At the close of the merger in December, we made three clear commitments. Complete the integration, expand our product portfolio, and strengthen our financial position. In just over three months, here's where we stand. On integration, our board and governance structure are in place. Workforce and office integrations are nearly complete, and we have finished a full review of our enterprise systems and operating processes.

We expect full enterprise integration to be complete over the next two-thre quarters with our manufacturing consolidation at Union City, Indiana, wrapping up by the end of Q2 2026. We're targeting to exit 2026 with a run rate of $20 million in annualized cost synergies from the merger across manufacturing efficiency, headcount reductions, the elimination of other duplicative administrative functions, and other synergies, including the elimination of redundant expenses, supply chain cost savings, and reduced overall facility costs stemming from the consolidation of our operating locations.

On our product portfolio, our teams are working together on a new cycle plan and product roadmap that charts a path for the commonization of key components of our hardware and software platforms, along with the development of a proprietary Class five-six cab chassis to unlock a larger slice of the full $23 billion class four through six commercial truck marketplace. As I discuss in a moment, we've already taken our first concrete step, the introduction of a new lower cost configuration of the W56 step van. We anticipate having additional pricing flexibility across our platforms as we realize merger synergies lower our bill of materials costs by utilizing commonized components across platforms and expanding our product line.

On financial position, we entered the year with a stronger balance sheet following the merger. As we disclose when we close the merger, we put in place at closing a new $40 million customer order lending facility to support working capital to fulfill orders. I'm pleased with how far we've come in a short amount of time, but there's more to be done. Now, let me tell you how we get from here to a larger scale, profitable business, and why we believe the path is clear and achievable. Let's start with the market. The medium-duty truck market in North America is large, approximately $23 billion in annual sales, and it's ripe for disruption. To understand why the timing is right, consider what has happened to how finished goods actually move through the sales and delivery channels.

Before 2020, e-commerce was a meaningful but smaller channel, roughly 11%-12% of U.S. retail. The pandemic accelerated the use of e-commerce over bricks and mortar stores by more than 40% in a single year. Critically, that shift in demand to online didn't revert. It reset to a new normal. Total U.S. retail sales are forecast to reach $6.2 trillion by 2030, with e-commerce accounting for 29% of that total, according to Forrester Research. The front door to homes and offices have become the point of sale, and the truck that shows up at that door is the last link in the chain. That shift has forced a fundamental redesign of logistics networks and supply chains.

The old hub and spoke logistics model is giving way to distributed fulfillment, hyper-localized inventory, smaller and more numerous distribution nodes located closer to the end customer. This results in shorter mid-mile and last-mile routes and higher density for deliveries. The result is visible in the data. Annual mileage for medium-duty vehicles has grown from roughly 31,000 miles in 2020 to nearly 48,000 miles in 2025, even as heavy-duty truck mileage has declined. The shift is also evident in smaller delivery van segments as well. Cox Automotive data shows Rivian registered 2,230 Class two electric vehicles in 2022. That increased to 7,679 in 2023 and grew to a total of over 33,000 vehicles registered between 2022 and 2025.

The key takeaways we see here, delivery freight is moving closer to the customer in rapidly growing networks. The routes are getting shorter and more predictable, and many of the additional vehicles doing this work are squarely in Class four through six. This isn't a trend. It's a structural reallocation of freight, and it plays directly into our strengths at Workhorse. While this structural shift occurred, most commercial fleets continued to run ICE truck platforms that are often unconnected, expensive to maintain, and increasingly out of step with what operators and regulators demand. Now, after all of this recent growth and change in transport networks, we're seeing a new trend emerging among some of the largest commercial fleet operators.

As they adjust to the new normal in commerce, companies are embarking on a massive restructuring of many of their networks with a focus on network optimization, depot consolidation, adding smaller same-day mini warehouse nodes for final and last mile delivery. Companies ranging from FedEx, UPS, Purolator, Cintas, Amazon, Pepsi, Frito-Lay, and many more are looking at how to use data and AI to optimize routes, add automation, and reduce transportation network operating costs. In addition, they're looking to add safety and driver assistance features as they move from next day to same day delivery and fulfillment commitments. Software-defined vehicles and electrification are well suited for this segment. Medium-duty routes are predictable, and most routes are depot-based and well within the range of today's batteries. Vehicles return to depot overnight for charging, and the operating cost savings are significant and can be verified.

Our Stables by Workhorse division, which operates as an independent FedEx contractor in Ohio, has documented savings of approximately 64% on fuel and maintenance compared to internal combustion vehicles, derived from three years of real-world mixed fleet comparisons. That's not a projection, that's operational data. While most of these routes are primarily being served by internal combustion powered trucks today, the economic, operational, and environmental benefits of replacing those ICE trucks with software-defined electric vehicles are becoming clearer to these large fleet operators. We're seeing similar data and EV adoption trends in another key segment we serve, school buses and shuttles. We believe these trends will continue as we introduce our next generation of vehicles with even better economic and operating benefits versus internal combustion trucks. To sum it up, we're not starting from zero.

Our commercial fleet customers already have over 1,100 of our trucks on the road, with 10 of North America's largest medium-duty fleets, more than 20 million cumulative miles driven, and a growing purchase order backlog. The momentum at Workhorse is real. Now, let's talk about our path to profitability. Here's the key insight. We don't need a large slice of this market to reach profitability. We believe we only need a very small one. The installed North American medium-duty fleet is estimated to be about five million vehicles. Annual truck production runs at about 200,000-250,000 units per year, which ACT Research pegs as roughly the average replacement rate for these classes of trucks. We believe capturing approximately 1% of that annual market, or roughly 2,500 vehicles per year is very achievable.

Based on our modeling, we believe that doing so would enable us to reach cash flow breakeven by the end of 2028. For a company that is already trusted by 10 of the largest fleets on the continent, that's not a stretch goal. We believe it is a modest executable milestone. Here's the second point. We already have the manufacturing capacity to get there. Our Union City, Indiana facility can produce more than 5,000 vehicles per year on a single operating shift. Our anticipated breakeven volume of approximately 2,500 units represents just 50% of that existing capacity. We do not need to build new facilities. We do not need to invest significant capital in manufacturing infrastructure. The plant is built, tooled, and ready.

Getting to profitability is a question of executing our product development plans, ramping up production and sales execution, not investing substantial CapEx into new manufacturing equipment and facilities. How do we get there? The first lever is cost. We need to drive down the bill of materials and bring our vehicles to price points that are competitive with conventional ICE trucks. This is where we believe our merger synergies, our platform commonization strategy, our economies of scale, and our supply chain discipline can all come together. We're already seeing the early results. We just launched a new lower configuration of the W5 six-step van featuring a 140-kilowatt battery option. That's not a minor adjustment. It reflects the first wave of synergy savings being passed directly to our customer base.

As we commonize hardware and software across our Class four, five , and six lineup, the savings can compound. Shared architecture means lower per unit costs, fewer unique components to source and inventory, and faster speed to market for new configurations. We're targeting a minimum of $20 million in annualized cost synergies from the merger integration alone and our product roadmap designed to unlock further reductions as we scale. We believe we have a clear executable plan to reach ICE comparable pricing. When we get there, combined with the estimated 60% operating cost advantage our trucks already deliver, the total cost of ownership argument becomes extremely compelling for any fleet operator. The second lever is sales. Let me walk through our strategy for reaching our profitability target. We have a broadened product line.

The merger with Motiv expanded our product portfolio beyond the W56 step van to include vehicles that serve Class four shuttles, transits, Type A school buses, and work truck applications, and it adds to the opportunity to sell to the state, local, education or SLED fleet segment. This is meaningful. It's opened up an entirely new customer category for Workhorse and expands the number of early adopting fleet operators we can serve with the compelling electric options. We go to market through a blended approach, internally staffed national account development, targeting new and large existing customers, body builders and fleet as a service providers. This is complemented by a dealer network that extends our reach into regional and mid-market fleet operators and provides leverage for after sales and parts support.

I'm pleased to report we've fully integrated both sales teams and approaches since we closed the merger, and we are already seeing active and growing customer engagement as a result. Our sales strategy is focused on three primary paths to growth. First, we're deepening existing accounts. Our repeat purchase rate from current customers is extremely strong, and these relationships are the most efficient source of near-term volume. Yesterday's announcement of another Purolator follow-on order is a good example of this. Second, we're actively targeting fleets and states with meaningful compliance requirements and purchase incentives for zero emission vehicles, where the economics of adoption are most compelling right now. This is also where we're continuing to push into Canada, where we have a well-established relationship with Purolator.

Third, as I mentioned earlier, we're pursuing municipal fleet operators, state, local, and education, where procurement timelines can be longer, but order volumes are substantial and the environmental and compliance drivers are strong. We're seeing positive trends in opportunity creation, progression, and closings that reflect the early impact of the operational and strategic changes we've implemented since the merger closed. As we close out Q1, this progress is translating into a strengthening sales backlog that we believe supports our plans for 2026 and beyond. The final piece is capital. Executing on this plan, ramping production, investing in our product roadmap, and growing our sales organization requires a stronger balance sheet than where we are today.

We are actively working to evaluate financing alternatives, increasing engagement with analysts, and attending investor conferences as part of that work. We believe that strengthening our balance sheet at this stage will position us to capitalize on the commercial momentum we are building and invest in the roadmap I've described. We'll share more of the details as they become available on capital formation. With that, let me turn it back over to Bob to walk through the financial details. Bob?

Thanks, Scott. Good afternoon, everyone. I will walk you through our Q4 and full-year 2025 financial results, our balance sheet, and our current liquidity position. Before I get into the numbers, a brief note on our reporting framework. The merger with Motiv closed on December 15, 2025. The merger was accounted for as a reverse merger, and as a result, our Q4 and full-year 2025 financial statements reflect Motiv on a standalone basis through December 15 and the combined company from December 16 onward. All amounts that I will share are prepared on this basis, unless otherwise noted. Revenue for the Q4 of 2025 was $9.7 million, compared to $6 million in the Q4 of 2024. During the fourth quarter, we delivered 65 vehicles, bringing our full-year 2025 total to 112 units.

This compared to 46 units delivered in full year 2024 and 40 vehicles in Q4 2024. The increase was driven by deliveries of follow-on orders from existing customers. Cost of sales for the Q4 was $15.5 million, compared to $9 million in the prior year. Gross margin for the quarter was -$5.7 million. We continue to expect gross margin improvement as we scale production volumes and realize the cost benefits of the combined platform. We believe our path to cash flow breakeven is tied to reaching approximately 2,500 units of annual production, which is achievable with our existing manufacturing footprint. As Scott noted, existing plant capacity supports this level of production more with minimal additional CapEx required. Total operating expenses for the Q4 were $14.4 million, compared to $13.5 million in theQ4 of 2024.

The Q4 of 2025 included $4.9 million of merger expenses, primarily legal and banking costs. The prior year period included $6.2 million charge to impair assets invested in discontinued product line. 2025 also included $1.4 million of spending in the Q4 of 2025 for the additional SG&A and R&D cost of Workhorse from the merger date through the end of the year. Operating loss was $20.1 million in Q4 2025, compared to $16.5 million in Q4 2024. Interest expense in Q4 2025 was $4.4 million, compared to $3 million in 2024. These interest costs largely reflect the interest costs of pre-merger Motive debt, which was all settled in connection with the merger with Workhorse.

These historical interest costs are not reflective of our anticipated go-forward interest and financing costs, as new lower cost financing facilities were put in place as part of the merger. Additionally, these new financing arrangements are at a more favorable interest rates than the pre-merger Motive debt arrangements. Net loss for the Q4 was $23.7 million, compared to $19.6 million the same period last year. For the full year 2025, revenue was $21.2 million, compared to $7 million for the full year 2024. On a pro forma basis, if the merger had been completed for both full year periods, total revenue for the full year 2025 would have been $34 million, compared to $13.7 million in 2024. The increase was primarily due to an increase in the number of vehicles sold in 2025 compared to 2024.

These pro forma figures are provided for illustrative purposes and are not necessarily indicative of the results that the combined company would have achieved had the merger been completed at the beginning of those periods. Turning to our balance sheet. As of December 31, 2025, the combined company had $12.9 million of cash and cash equivalents, including restricted cash of $700,000. A key benefit of the merger was the simplification of our capital structure. As of December 31, 2025, our only outstanding debt is $5 million convertible note, which may convert to equity in connection with post-closing equity financing and $10 million outstanding under a new cash flow credit facility put in place at closing. In addition, we have access to a customer order lending facility of up to $40 million to fund vehicle manufacturing as we receive confirmed orders.

We had no borrowings outstanding under this facility as of the end of 2025. Looking ahead, we are actively exploring opportunities to raise additional capital to support our growth plan. We are evaluating financing alternatives and believe the strengthening of our balance sheet at this stage will position us to capitalize on commercial momentum we are building and to invest in the product roadmap Scott described. We will share more details as they become available. We remain focused on converting our backlog into revenue, manage our cost structure tightly as we integrate and positioning the combined company for sustainable growth. While we are not providing specific financial guidance at this time, we expect deliveries to increase over the course of 2026 as we ramp production at Union City, convert our growing pipeline into confirmed orders.

We will continue to provide visibility into our key operating metrics each quarter. With that, let me turn it back over to Scott for closing remarks.

Thanks, Bob. I wanna leave you with the same through line that I started with. Workhorse does not need a moonshot to reach profitability. We need a small slice of a big underserved market that is experiencing a substantial transition. We have the plant to produce at that volume today. We have a clear plan to drive down costs to ICE comparable levels. We have a sales strategy focused on the customers and geographies most likely to act, and we are actively working to strengthen our balance sheet to fund the journey. What makes me confident is not just the plan, it's that we are already executing against it. We made three commitments at the close of the merger, and we're delivering on all three. The proof is on the road.

More than 1,100 trucks, 20 million real-world miles, documented 64% operating cost savings and repeat purchase behavior from 10 of North America's largest fleets. This is a working business with a clear path forward. We appreciate your continued support, and we look forward to reporting our progress. Operator, we'll now open the line for questions.

Thank you. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone indicates your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. We ask that you please limit to one question and one follow-up question. Our first question is from Craig Irwin with Roth Capital Partners. Please proceed.

Good evening and thanks for taking my questions. In the Q4, you obviously would have had some material one-time expenses related to closing the merger. Maybe describe what those were and break those out in a little bit of detail. You know, with that, you know, how do the $20 million in synergies cut into the PNL over the course of 2026?

Hi, Craig. It's Bob. In the Q4, we recognized a little over $4 million in what we would call one-time, you know, fees and cost associated with the merger. Your second part of that question was, how does this lay out over the course of the year for 2026? We expect to be exiting 2026 at a $20 million run rate. Some of those are immediate. You know, we made several personnel changes right away, and then some of them take a little more time as we migrate work into the Union City facility. We're on track and well within that process right now.

That is actually.

Oh, Craig, I was just gonna add to Scott here. Good to chat with you. The primary sources, there's really four of them in those, in that $20 million. The biggest first chunk comes from the manufacturing consolidation. We're exiting the facility. Actually, today is the last day for the Motiv facility, turns out, moving everything down into Indiana. The second part, significant headcount reductions. Most of that's in SG&A and R&D, consolidating the teams, if you will. And then the third is, you know, things like professional fees, insurance, marketing costs, just redundant costs that both companies were spending. And so we've cut, you know, we've already cut a lot of that out. Then the rest is primarily some facility reductions, consolidating into fewer spaces, with a smaller team.

Those are the four big components. We remain, you know, quite confident on the $20 million. We'll exit the year at a run rate of about $20 million in savings. We're excited about that. That does not include any supply chain savings, by the way. We didn't try to factor that in because there's been a lot of moving parts, as you can imagine, in the supply chain world, so with tariffs and so forth. We think there's more there, and we'll come back in future quarters with some of the estimates on that front.

Okay, excellent. With the significant change in your manufacturing footprint, would you be optimistic about reaching positive gross margins on your revenue by the Q4 this year?

Craig, I don't think we're quite there for the Q4 this year. Obviously, it's more near-term as we continue to put volume in there, but it probably won't be in 2026.

Yeah. Understood. Thanks again for taking my questions.

Thanks, Craig.

Our next question is from Ben Somers with BTIG. Please proceed.

Hey. Yeah, good afternoon. Thanks for taking my question. Kind of wanted to ask on the step van market here and just your outlook there, and then I guess any kind of preliminary feedback we've gotten on the new lower-cost model?

Yeah. The preliminary feedback on the new lower-cost models are really good, both from dealers and directly from buyers. I think we'll probably be able to give you some news on some of the feedback in the next few weeks on that, because we've had a lot of really positive feedback. In large part, that was a kind of expected reaction. We've spent a lot of time talking to dealers, to our customers to really understand the duty cycle of the step vans. What they told us is, "We love the W56 as is.

What we also need is a complementary lower-cost vehicle that is, maybe has a little less payload, doesn't need to go as far per day, but we can spend less on it." They're mixing these together now is the plan, so that longer routes will take the current W56, shorter routes, smaller payload operations will take the new smaller vehicle. We see other opportunities just like that in the step van world to you know continue to tweak our product lineup. We think that'll be a real benefit. Sorry, what was the other part of your question?

I know that was kind of my next question was just a little bit on the plant capacity. I know you guys mentioned that there's just minimal work to be done there. I guess if you just give any more color on kind of what we need to do to get to that 5,000+ capacity. I know you guys mentioned that's pretty much minimal CapEx there, so just kind of curious what's left to be done.

Yeah. Ben, I think if you look at the total capacity, we're in pretty good shape for the foreseeable future. The minimal type capacity to get to 5,000 might be more things like lift equipment and torque guns, that type of thing. It is very, very minimal. I think as we expand products, those may drive capital expenditures, but those products would be incremental revenue and driving their own separate ROI.

Yeah, maybe slightly more specific to Ben. It's a good question. Think about the you know December state of the Union City facility. Had a single line operating W56 production. In the Q1, we've completely relocated now our former line in Detroit metro area from Motiv. So the Motiv chassis and powertrain has now been moved over there. So that's a second line. We're adding a third line right now, which will come up in Q2, which is our Class four truck. That all three of those lines will be operating you know within the same facilities. Think of a lot more production, a lot more revenue potential off of exactly the same footprint and very little additional capital.

Awesome. Thank you guys for the update and thanks for taking my questions.

Thanks, Ben.

Thanks, Ben.

As a reminder to star one on your telephone keypad if you would like to ask a question. Our next question is from Michael Shlisky with D.A. Davidson . Please proceed.

Hello. Thanks for taking my questions here.

Mike.

Hey, guys. I want to take a quick step back, and you've mentioned that Motiv, the Motiv product is now in the Union City facility. Going forward, how will the Workhorse product and the Motiv product differ in the eyes of the customer? Trying to figure out, like, what will the builds be in 2026. More of the Motiv, more of the Workhorse, or more of the Class four.

That's a great question. We'll be sunsetting the former Class 5-6 chassis from the Motiv side. We've got some orders. We came into the year with a firm order backlog for a number of those orders, one of which was, you know, we talked about yesterday, the Purolator order. Once those are behind us, as we progress through this year, we will wind down that line, but we'll be ramping up, you know, new lines for our Class 5-6 cab chassis and also complementing that with the Class four line that I mentioned a few minutes ago. We anticipate having at least three lines running there going forward.

We've got two of three up now, three by the end of Q2, and then we'll be moving one of those, you know, more offline at the end of this year and bringing up the new Class 5-6 cab chassis line. We're gonna continue to see a lot of activity and transition there through this year. You know, obviously the goal is to leverage the fixed cost structure as much as we can in that facility.

Got it. Thanks for that. My other question was around the bill of materials. You had kind of deferred on the supply chain potential and the synergies that might be above and beyond what you had out there for the $20 million. I'm curious as to, you know, give us a ballpark or just some basic guidepost as to how much or how you plan to reduce the bill of materials during 2026 and whether supply chain is, you know, can that be brought under control by the end of the year?

Another really good question. Think of sort of two, at least two primary areas we're focused on in that regard. One is as we go through our product roadmap and our so-called cycle plan, think of batteries, most of the components of the powertrain, braking systems, even chassis rails, et cetera. The more we can commonize those parts from Class four to five to six, especially the electronics and battery side, the more leverage we're gonna get on the supply chain side. We're also gonna reduce the number of parts we have to stock.

The reason we haven't given you an estimate on that yet is we're still working our way through what is, you know, what does that future state look like 12 months from now when we've got a common set of batteries, a common set of electric motors, common set of brakes, common set of other systems across all three of these classes of trucks now. That's a big one. We'll come back as the year progresses with, you know, tighter estimates on where we think that goes. Our ultimate goal, and we see a path to get there, is to get down to a BOM structure that can support pricing that's competitive with ICE trucks. That's obviously a significant drop from where we are now, both on BOM and price.

The W5/6 140-kilowatt launch last week is an example of that. That's that has less battery power and it has a lower BOM, so we're immediately dropping price on those, and that allows us to maintain our margin. The last big feature is volume. As we drive more volume, three lines, more volume per line through that plant, you'll see, you know, our cost structure come down, with the BOM, the build cost itself, on the manufacturing cost side. I don't know, Bob, if you want to add any more to that.

No, that was good, Scott.

Great. Thank you. I appreciate the color.

Thanks, Mike.

Thanks, Mike.

We have reached the end of our question and answer session. I would like to turn the conference back over to Scott for closing remarks.

We want to thank everybody for coming in today and give everyone a sense for how excited we are going forward with the company. We welcome you back at the end of next quarter. We're happy to report more after that. We've shipped quite a few units in the Q1. We'll talk more about that in the coming weeks. We're continuing to see, you know, our firm order backlog build since the closing of the merger. You know, we really see some great blue sky ahead and look forward to telling you more about the company's progress in future quarters. Thanks very much.

This does conclude today's conference. You may disconnect your lines at this time, and thank you for your participation.