RumbleOn recently announced results for the second quarter ended June 30 , 2024 , noting a 12 percent revenue drop in a challenging retail sales environment . The company sold 12,004 new powersports vehicles and 4,796 pre-owned vehicles during Q2 .

“ Our second quarter performance reflects the strength of our powersports dealership group as we continue to progress on our turnaround ,” says Mike Kennedy , Rumble- On ’ s CEO . “ It is a challenging time for the

powersports industry as we navigate a highinterest environment , a cautious consumer , and inflated new major unit inventories . Despite these challenges , I ’ m proud of the way our team has responded . The team ’ s efforts delivered positive free cash flow during the first half of 2024 , and we expect to continue to deliver positive free cash flow in the back half of 2024 . We remain laserfocused on achieving our Vision 2026 goals and creating per-share value .”

Q2 2024 Highlights ( compared to Q2 2023 ):

Revenue of $ 336.8 million decreased 12.0 percent .

Net loss totaled $ 0.7 million compared to net loss of $ 13.6 million .

Selling , general & administrative expense

( SG & A ) was $ 71.4 million compared to $ 100.3 million . Adjusted SG & A decreased 19.4 percent to $ 70.8 million , or 78.7 percent of gross profit ( GP ), from $ 87.8 million , or 82.5 percent of GP .

Adjusted EBITDA of $ 16.2 million decreased 19.8 percent .

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lion in the second quarter from $ 22.3 million in the second quarter of fiscal 2023 . The increase in revenue was due to the expansion into larger retail stores in the U . S . and a shift in sales strategy , mainly focused on in-store sales , which generally involve larger volumes and fewer returns .

The cost of revenue on UTVs , ATVs , and E-bikes increased 55.7 percent to $ 23.0 million in the second quarter from $ 14.8 million in the second quarter last year , and the gross profit increased 48.6 percent , from $ 7.6 million

in Q2 2023 to $ 11.2 million in Q2 this year . The increase in the cost of revenue was in line with the increase in sales .

The gross margin decreased by 110 basis points to 32.8 percent in the second quarter . The slight decrease was primarily due to a rise in global container freight in the second quarter of this year . Freight costs increased in the second quarter compared with Q2 last year .

PONTOONS Second-quarter revenue from pontoon boat sales decreased 73.5 percent to $ 1.2 million from $ 4.4 million in the 2023 second quarter , reportedly due to the company ’ s shift

from retailing to dealer sales starting in its fiscal year 2024 . Dealers have experienced high rejection rates at floorplan financing providers such as Northpoint , which is consistent with the industry-wide trend .

The cost of revenue on pontoon boats decreased 76.5 percent to $ 0.9 million in the second quarter from $ 3.9 million in the 2023 second quarter . Gross profit decreased 51.6 percent to $ 0.3 million in Q2 from $ 0.5 million in Q2 2023 .

Gross margin increased 10.2 percentage points to 22.4 percent of sales in the second quarter , compared to 12.3 percent of sales in the second quarter of fiscal 2023 . The increased gross margin was primarily due to

the company ’ s shift to selling higher-margin models of pontoon boats .

“ Several production initiatives during the quarter are positioning us to further expand output levels each month ,” Shan adds . “ A new expansion has added 90,000 square feet to our manufacturing facility in Garland , Texas , to support increased production across motor and marine product verticals . At this facility , we are also launching a new automated vehicle assembly robot line that is expected to be installed in the coming weeks . This automation is expected to improve efficiency by 50 percent and enhance safety for the production of ATV and UTV vehicle lines .”