What changed in NeoVolta Inc.'s 10-K — 2024 vs 2025

ITEM 1. BUSINESS Overview We are a designer and manufacturer of high-performance energy storage systems (“ESS”) for residential and commercial applications. Our product portfolio includes the NV14, NV24, NVPlus, NV7600 stand-alone inverter, and most recently, the NV16 kW AC hybrid inverter with 24 kW PV input and a 250 kW / 430 kWh commercial and industrial (“C&I”) system.

Our systems combine lithium iron phosphate (LiFePO₄) battery technology with hybrid inverter capability, providing safe, flexible, and adaptable solutions for backup power, self-consumption, and energy resilience. We market and sell our products primarily through certified solar installers and regional and national distributors.

Initially focused on Southern California, we have since expanded into other markets throughout the United States and Puerto Rico. Looking forward, we intend to grow across residential, commercial, and industrial segments while building financing solutions and pursuing domestic and FEOC-compliant sourcing to support long-term competitiveness.

History We were founded in 2018 to develop safe, reliable, and versatile residential energy storage systems. Later that year, we produced our first prototype of the NV14, which received certification and approval from the California Energy Commission in early 2019. Customer installations began shortly thereafter in San Diego County following approval from San Diego Gas & Electric.

Between 2020 and 2022, we expanded beyond Southern California into other major metropolitan regions and ultimately into more than 15 additional states and territories. During this period, we introduced the NV24 expansion battery and continued to secure certifications under evolving California and national regulatory standards.

In 2023, we transitioned from contract manufacturing to in-house production by hiring key personnel and assuming direct responsibility for manufacturing operations in Poway, California. This change enhanced quality control and supply chain resilience.

Since 2024, we have broadened our product portfolio with the launch of the NVPlus energy storage system and the NV7600 stand-alone inverter, extending our reach into higher-capacity residential and light commercial applications. In February 2025, we expanded into a larger facility in Poway to support increased production.

Subsequent to fiscal year end, we announced two additional products: a 250 kW / 430 kWh Commercial & Industrial (C&I) Battery Energy Storage System, and the NV16 kW AC hybrid inverter with 24 kW PV input, expected to be available beginning in November 2025. 2 Our Products We design and manufacture energy storage systems (“ESS”) that combine lithium iron phosphate (LiFePO₄) battery technology with integrated or stand-alone inverters to provide safe, reliable backup power for residential and light commercial applications.

All systems are NEMA 3R rated for indoor or outdoor installation, UL 9540/9540A certified, and compatible with both AC- and DC-coupled solar configurations. · NV14 — Our flagship ESS, the NV14 integrates a 14.4 kWh battery with a 7.6 kW hybrid inverter capable of 120V/240V residential and 208V three-phase commercial operation.

The system is designed for energy efficiency, time-of-use optimization, and backup power. · NV24 — The NV24 expansion battery increases NV14 capacity from 14.4 kWh to 24.0 kWh without requiring an additional inverter, allowing customers to scale storage at lower cost. · NVPlus — Introduced in 2024, NVPlus is a higher-capacity ESS developed for larger residential and small commercial applications.

It provides extended runtime, supports greater solar inputs, and is designed for customers requiring whole-home backup or higher daily cycling. · NV7600 — A stand-alone 7.6 kW inverter launched in 2024, designed for use with NeoVolta storage products or as a retrofit solution for existing solar systems.

In addition to these core products, we have also developed the NV14-K, a custom variant of the NV14 engineered to EOS Linx specifications. This product is manufactured on a limited basis for a single customer application and is not marketed generally.

Subsequent to fiscal year end, we announced two additional products: (i) a Commercial & Industrial Battery Energy Storage System (BESS) with a 250 kW power rating and 430 kWh usable capacity, designed for larger-scale applications; and (ii) the NV16 kW AC hybrid inverter with 24 kW PV input, developed to support higher-capacity residential installations and whole-home backup.

The NV16 kW inverter is expected to become generally available in November 2025. 3 Market Overview Our addressable market is expanding across multiple customer segments, supported by favorable policy, resiliency needs, and evolving financing and distribution models. Residential Retrofit .

There are an estimated 4.2 million U.S. homes equipped with solar panels, and more than 3 million of these do not currently have battery storage. (SolarInsure) This represents a significant retrofit opportunity, particularly as installed inverters approach end of life after 10–15 years of operation.

Grid reliability concerns, increasingly common utility outages, and changing rate structures are expected to accelerate adoption of storage among this installed base. New Residential and Small Commercial Installations . The U.S. installer market is highly fragmented, with more than 11,000 companies nationwide, most of them small independent operators not typically serviced by larger ESS providers.

These smaller installers represent NeoVolta’s core customers. Once certified, they generally become recurring purchasers, relying on just-in-time availability to serve homeowners who prefer not to stock or pre-finance equipment. Battery adoption in new solar projects is rising rapidly. Nationally, only about 6% of residential solar systems included storage in 2020, compared to an estimated 15–20% by 2024.

(Clean Energy Group) In California, adoption has been even stronger: under the new net-billing tariff, roughly 60% of new residential systems are now being paired with storage, compared to 10–14% under prior net-metering rules. (Utility Dive) Nationally, the residential storage market is scaling quickly—Wood Mackenzie reports ~458 MW added in Q1 2025 alone, the strongest first quarter on record.

(Wood Mackenzie) Commercial and Industrial Expansion. Beyond residential applications, the market for C&I storage is emerging as a new growth segment. Businesses are increasingly seeking solutions for demand-charge management, backup power, and grid services.

To address this demand, we recently announced a 250 kW / 430 kWh C&I battery energy storage system, positioning NeoVolta to participate directly in this next stage of adoption. Financing and Distribution. The importance of financing structures has grown significantly across all customer segments.

As system costs increase and federal incentives such as the Investment Tax Credit (“ITC”) phase down under the One Big Beautiful Bill Act (scheduled to sunset by December 31, 2025), adoption is expected to depend increasingly on third-party ownership, leasing, and loan-based models. These financing options reduce upfront costs and align payments with monthly utility savings, broadening access to storage.

At the same time, NeoVolta is evolving its channel strategy: while we initially sold primarily to independent installers, we are now leveraging regional and national distributors to expand reach, improve logistics, and scale efficiently across multiple geographies. Policy and Resiliency Drivers. Federal and state policy incentives continue to support adoption, including the ITC, though subject to phase-outs after 2025.

Several states, led by California and Hawaii, have adopted building codes and interconnection requirements that mandate or encourage storage. Utilities are increasingly turning to rate reform, such as California’s net-billing tariff, which improves the economics of pairing solar with batteries.

Meanwhile, grid reliability concerns—including widespread Public Safety Power Shutoff events in California—continue to highlight the resiliency benefits of energy storage for both homeowners and businesses.

While NeoVolta initially focused on direct sales to small, independent installers, we are now leveraging regional and national distributors to extend reach and support scalability. Distributors improve logistics, expand product availability, and position us to penetrate high-growth markets such as Texas, Florida, Hawaii, and Puerto Rico. Financing Partnerships . We are developing financing solutions that align with the evolving market.

As federal incentives phase down under the One Big Beautiful Bill Act (scheduled to sunset by December 31, 2025), adoption is expected to rely increasingly on third-party ownership, leasing, and loan-based models. By working with financing partners, we intend to make our products more accessible and affordable to homeowners and small businesses, supporting continued adoption despite changing incentive structures.

Product Innovation. We are investing in research and development to expand our product portfolio and maintain a competitive edge.

In addition to our core NV14, NV24, NVPlus, and NV7600 inverter, we recently announced two major product launches: (i) a 250 kW / 430 kWh commercial and industrial battery energy storage system, and (ii) the NV16 kW AC hybrid inverter with 24 kW PV input. These launches expand our reach into larger residential and commercial markets.

We have also begun advanced discussions with technology partners to develop future generations of NeoVolta storage systems. Commercial Market Entry. We are positioning NeoVolta to compete in the emerging commercial and industrial (“C&I”) segment, where businesses are seeking solutions for resiliency, demand-charge management, and grid services.

Our newly introduced 250 kW / 430 kWh C&I product is the first step in this expansion. Strategic Combinations. In addition to organic growth, we may evaluate acquisitions, joint ventures, or other strategic transactions to expand our technology base, accelerate market entry, and enhance financing capabilities.

We believe this growth strategy—driven by expanded distribution, financing innovation, product development, and C&I expansion—will allow NeoVolta to scale efficiently and strengthen our competitive position in the growing energy storage market. 5 Competition We compete with several established companies in the energy storage systems (“ESS”) market, including Tesla, LG Chem, Sonnen, Enphase, SunPower, and SMA America.

Many of these competitors have significantly greater financial resources, manufacturing capacity, brand recognition, and established distribution channels. Their scale allows them to pursue aggressive pricing, broader marketing, and faster product refresh cycles.

In addition to dedicated ESS providers, we also face competition from diversified industrial companies, generator manufacturers, inverter suppliers, and other firms that offer alternative backup power or distributed energy solutions. We expect new entrants to continue to emerge as energy storage adoption expands and regulatory requirements evolve.

Despite the presence of larger and more established competitors, we believe NeoVolta maintains distinct competitive advantages: Product Availability. We generally fulfill orders in less than two weeks, often within days, compared to extended backlogs reported by some competitors. This supports the cash-flow needs of small and mid-sized installers. Installer Service.

Our Certified Installer Program, direct technical support, and remote monitoring capabilities provide education and assistance to installers, fostering loyalty and reducing installation risk. Product Safety and Flexibility. Our systems use lithium iron phosphate (LiFePO₄) chemistry and are UL 9540/9540A certified with no thermal runaway risk.

Products are NEMA 3R rated for indoor/outdoor use, support both AC- and DC-coupled solar, and allow capacity expansion without requiring an additional inverter. Market Focus. Unlike some competitors that sell storage primarily as an add-on to solar, NeoVolta is focused entirely on energy storage.

We target independent installers and distributors that are underserved by larger providers, particularly in retrofit markets and emerging commercial segments. We believe these differentiators allow us to compete effectively in a rapidly growing market, even against larger, more established participants.