Company: FWDI
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001683168-25-006141
Chunk: 44

Company: Forward Industries, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Item 1
Chunk 44
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(156,000) 
     2,000  
     (158,000) 
     (7,900.0%)
  
    Loss from continuing operations 
    $(5,124,000) 
    $(1,447,000) 
    $(3,677,000) 
     254.1% 

The discussion that follows
below provides further details about our results from continuing operations for the 2025 Period as compared to the 2024 Period.

The decline in net revenues
from the 2024 Period to the 2025 Period is primarily attributable to the loss of a major customer in December 2024 as well as a net decrease
in volume of work and projects with continuing customers, partially offset by projects from new customers. In December 2024, our largest
design customer notified us of its plan to discontinue their insulin patch pump program, on which we were working. We expect this to continue
to cause a material decrease in our revenues relative to fiscal 2024. Management initiated cost reduction measures to mitigate the impact
of declining revenues, including two reductions in workforce in January and June 2025.

Our gross margin decreased
from 26.7% in the 2024 Period to 3.3% in the 2025 Period, driven by lower revenue and utilization rates and was partially offset by staff
reductions in January and June of 2025.

Sales and marketing expenses
decreased primarily due to lower personnel costs and lower marketing spend but increased as a percentage of revenues from 4.0% in the
2024 Period to 4.4% in the 2025 Period.

General and administrative
expenses increased in the 2025 Period. Lower personnel costs related to staff reductions, a reduction in expenses related to our annual
shareholder meeting and the June 2024 reverse stock split and lower director compensation were  offset by higher professional
fees primarily related to the sale of the OEM segment. Management continues to monitor the various components of general and administrative
expenses and how these costs are affected by inflationary and other factors. We intend to adjust these costs as needed based on the overall
needs of the business.

 28 

The change in other (income)/expense,
net is primarily due to the change in fair value of the warrant liability, a decrease in interest income resulting from lower cash balances
in interest bearing accounts, and a decrease in interest expense resulting from a reduction in the amount