Gauzy Ltd. Ordinary Shares

First quarter 2025 revenue was $22.4 million, down from $24.7 million in the prior-year period. Gross margin was 25.6% versus 25.1% a year ago, and adjusted EBITDA was negative $5.5 million compared with negative $4.8 million. Operating expenses were $14.4 million, down 9% from $15.8 million. By segment, Safety Tech revenue was $10.8 million (up 1.5%), Aero revenue was $7.6 million (up 24.6%), Architecture revenue was $2.4 million (down 8.2%), and Automotive revenue was $1.5 million versus $1.3 million. The company ended the quarter with $36.2 million of total liquidity, including $1.2 million of cash and cash equivalents and $35 million of undrawn credit capacity, and total debt of $37.3 million. Gauzy reiterated 2025 revenue guidance of $130 million to $140 million and reaffirmed positive adjusted EBITDA for the full year, saying the second half should be stronger than the first.

Eyal Peso framed the quarter as a solid start despite March tariff-related uncertainty and said there were no cancellations, only timing shifts. He emphasized three recent business milestones: the Air France KLM first-class shading win, Mercedes-Benz using Gauzy smart glass in 75% of the Vision V glazing, and the ramp-up of Cadillac Celestiq serial production. His tone was confident and repetitive on demand resilience, saying the backlog and purchase orders support the company’s reaffirmed full-year outlook.

Meir Peleg said the quarter reflected better operational efficiency and improved cash management, with gross margin rising to 25.6% from 25.1% and operating expenses down 9% to $14.4 million. He highlighted a sharp improvement in operating cash use to $0.6 million from $6.9 million a year ago and free cash flow of negative $2.3 million versus negative $8.4 million. He also noted total liquidity of $36.2 million, including $1.2 million of cash, and explained that the new $10 million Mizrahi debt facility came with a 370 basis point interest rate reduction and no prepayment penalties. He reiterated revenue guidance of $130 million to $140 million and said the company expects positive adjusted EBITDA in 2025, while also saying free cash flow should remain negative in 2025 and turn positive in 2026.

Analysts focused on the Q1 timing weakness, the path to converting backlog into revenue, cash flow sustainability, and what will drive EBITDA positive. Management said the March slowdown was mainly customer hesitation around tariff headlines, not demand destruction, and repeatedly said the business itself was not hurt. On backlog, Eyal Peso broke out the mix as about $15.5 million Aero, $17 million to $18 million Safety Tech, about $6 million Automotive, and about $2.2 million Architecture, saying the shipments are expected over the next few quarters. On cash flow, management said better supplier terms and invoice financing were the main drivers of the improvement, but Meir Peleg cautioned that 2025 is still expected to be free-cash-flow negative.