Deflagration testing conducted by Fluence and DNV, along with large-scale fire testing by Fluence and CSA Group, confirms Gridstack Pro 2000, featuring Fluence’s U.S.-manufactured battery modules, as the first domestic content solution to exceed the industry’s top safety standards   ARLINGTON, Va., Dec. 12, 2024 (GLOBE NEWSWIRE) -- Fluence Energy, Inc. (“Fluence”) (NASDAQ: FLNC), a global market leader delivering intelligent energy storage, operational services, and asset optimization software, today announ ...

Part I [Business Overview](index=6&type=section&id=Item%201.%20Business) Fluence Energy leads the global energy storage market with modular solutions, services, and digital platforms, leveraging a capital-light model and focusing on U.S. domestic supply chain development - **5.0 GW** deployed, **7.5 GW** contracted backlog, **115.9 GW** global pipeline as of September 30, 2024[17](index=17&type=chunk) - Growth is driven by declining lithium-ion battery costs and favorable government policies, including the U.S. Inflation Reduction Act (IRA)[19](index=19&type=chunk)[20](index=20&type=chunk) - Offerings include Energy Storage Solutions (Gridstack, Sunstack), Services (O&M), and Digital Applications (Fluence Mosaic, Nispera)[22](index=22&type=chunk)[25](index=25&type=chunk) - A concentrated customer base saw the two largest customers account for approximately **50%** of FY2024 revenues, with related party AES and affiliates contributing approximately **41%**[35](index=35&type=chunk) - The company employs a capital-light manufacturing strategy, utilizing third-party regional manufacturers, including a key facility in Utah, for system assembly[42](index=42&type=chunk) - Significant intellectual property includes over **179** granted patents and over **108** registered trademarks worldwide as of September 2024[50](index=50&type=chunk) [Government Regulation and Compliance](index=14&type=section&id=Government%20Regulation%20and%20Compliance) Global government policies, including the U.S. IRA and EU's 'Fit for 55' package, significantly influence the business, alongside evolving trade policies like future U.S. tariffs on Chinese batteries - The U.S. Inflation Reduction Act (IRA) provides a key Investment Tax Credit (ITC) for standalone energy storage, with bonus credits for domestic content or energy community projects[56](index=56&type=chunk)[60](index=60&type=chunk) - U.S. Section 301 tariffs on Chinese lithium-ion non-EV batteries are set to increase from **7.5%** to **25%** on January 1, 2026[61](index=61&type=chunk)[62](index=62&type=chunk) - European initiatives like the 'Fit for 55' package, REPowerEU Plan, and Net Zero Industrial Act (NZIA) foster a supportive regulatory environment for clean energy and manufacturing[57](index=57&type=chunk) - U.S. FERC orders (841, 2222, 2023) aim to remove barriers and accelerate energy storage project grid connections[68](index=68&type=chunk) [Risk Factors](index=19&type=section&id=Item%201A.%20Risk%20Factors) Fluence faces risks from limited operating history, profitability challenges, order fluctuations, supply chain issues, customer concentration, intense competition, regulatory changes, and an ongoing SEC investigation - The company has a limited operating history and historically incurred net losses, though it achieved profitability in FY2024[79](index=79&type=chunk)[83](index=83&type=chunk) - Fluence is dependent on a small customer base, with AES and its affiliates representing approximately **41%** of FY2024 annual revenue[107](index=107&type=chunk) - The business faces supply chain risks from reliance on limited third-party manufacturers and suppliers, alongside evolving global trade policies like the planned 2026 tariff increase on Chinese batteries[90](index=90&type=chunk)[102](index=102&type=chunk)[183](index=183&type=chunk) - Demand is highly dependent on government incentives such as the IRA; any reduction, elimination, or uncertainty could adversely affect the business[180](index=180&type=chunk)[182](index=182&type=chunk) - As a "controlled company" due to Continuing Equity Owners' voting power, Fluence is exempt from certain NASDAQ corporate governance requirements, including a majority-independent board[198](index=198&type=chunk) - The Tax Receivable Agreement mandates substantial cash payments to Founders, reducing cash available for other corporate purposes[215](index=215&type=chunk)[217](index=217&type=chunk) - The company is cooperating with a formal SEC investigation reviewing revenue recognition, internal controls, software cost capitalization, and related-party service contracts, initiated after a short-seller report[205](index=205&type=chunk) [Cybersecurity](index=59&type=section&id=Item%201C.%20Cybersecurity) Fluence manages cybersecurity risks via a NIST-guided ISMS, overseen by the Board's Audit Committee and a CISO, with no material incidents reported to date - The cybersecurity risk management program is based on the National Institute of Standards and Technology (NIST) Cyber Security Framework (CSF)[233](index=233&type=chunk) - A Cybersecurity Steering Committee, chaired by the CISO, governs the program, with primary oversight and quarterly updates provided to the Board's Audit Committee[234](index=234&type=chunk)[236](index=236&type=chunk) - The CISO, with over **30** years of IT experience, reports to the CIO, and management stays informed on cyber threats through internal and external intelligence[236](index=236&type=chunk) [Properties](index=60&type=section&id=Item%202.%20Properties) Fluence's corporate headquarters is a leased 17,000-square-foot office in Arlington, Virginia, supplemented by global offices and specialized facilities - Corporate headquarters is a leased office of approximately **17,000** square feet in Arlington, Virginia[237](index=237&type=chunk) - The company leases numerous global offices and operates an energy storage testing facility in Erlangen, Germany[237](index=237&type=chunk) [Legal Proceedings](index=60&type=section&id=Item%203.%20Legal%20Proceedings) Fluence is involved in periodic legal proceedings but currently believes none will have a material adverse effect on its business or financial condition - The company is not currently facing any legal proceedings believed to have a material adverse effect on its business, financial condition, or cash flows[241](index=241&type=chunk) - Refer to Note 14 of the consolidated financial statements for a description of material pending legal contingencies[241](index=241&type=chunk) Part II [Management's Discussion and Analysis (MD&A)](index=63&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This MD&A provides management's perspective on financial results, condition, and outlook, detailing revenue drivers, operating metrics, liquidity, capital resources, and critical accounting policies [Results of Operations](index=70&type=section&id=Results%20of%20Operations) Fluence achieved a net income of $30.4 million in FY2024, a significant turnaround, with total revenue growing 21.7% to $2.7 billion and gross profit margin improving to 12.6% | Metric | FY 2024 | FY 2023 | Change | Change % | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | $2,698.6M | $2,218.0M | +$480.6M | +21.7% | | Gross Profit | $341.1M | $141.0M | +$200.1M | +142.0% | | Gross Margin | 12.6% | 6.4% | +6.2 p.p. | - | | Net Income (Loss) | $30.4M | ($104.8M) | +$135.2M | +129.0% | - The **$480.6 million** revenue increase was primarily driven by higher Gridstack cube volumes and growth in services revenue from operational projects[297](index=297&type=chunk) - Gross profit increased by **$200.1 million**, with margin expansion due to operational efficiencies and improved profitability on newer Gridstack projects[299](index=299&type=chunk) - Operating expenses increased, with Sales & Marketing up **55.3%** and General & Administrative up **26.9%**, primarily due to increased headcount supporting business growth[302](index=302&type=chunk)[303](index=303&type=chunk) [Key Operating Metrics](index=67&type=section&id=Key%20Operating%20Metrics) As of September 30, 2024, Fluence reported significant year-over-year growth in deployed energy storage (5.0 GW), contracted backlog (7.5 GW), and pipeline (25.8 GW), alongside strong services and digital contract growth Energy Storage Metrics | Metric (Energy Storage) | 2024 | 2023 | Change % | | :--- | :--- | :--- | :--- | | Deployed (GW) | 5.0 | 3.0 | +66.7% | | Contracted Backlog (GW) | 7.5 | 4.6 | +63.0% | | Pipeline (GW) | 25.8 | 12.2 | +111.5% | Services & Digital Metrics | Metric (Services & Digital) | 2024 (GW) | 2023 (GW) | Change % | | :--- | :--- | :--- | :--- | | Service Assets Under Mgmt | 4.3 | 2.8 | +53.6% | | Digital Assets Under Mgmt | 18.3 | 15.5 | +18.1% | | Service Contracted Backlog | 4.1 | 2.9 | +41.4% | | Digital Contracted Backlog | 10.6 | 6.8 | +55.9% | FY 2024 Order Intake | Category | FY 2024 Order Intake (GW) | | :--- | :--- | | Energy Storage Products | 5.2 | | Service Contracts | 3.0 | | Digital Contracts | 8.6 | [Liquidity and Capital Resources](index=71&type=section&id=Liquidity%20and%20Capital%20Resources) Fluence's liquidity sources include cash from operations, debt facilities, and IPO proceeds, with a $500 million revolving credit facility and significant Tax Receivable Agreement obligations - Net cash provided by operating activities was **$79.7 million** in FY2024, a **$191.6 million** positive swing from a use of **$111.9 million** in FY2023, driven by higher net income and improved working capital management[328](index=328&type=chunk) - In August 2024, the ABL facility was converted into a **$500 million** senior secured cash flow revolver (the "2024 Revolver"), maturing November 2027, with no cash drawn but **$74.9 million** in letters of credit outstanding as of September 30, 2024[317](index=317&type=chunk) - A supply chain financing program allows early supplier payments, with **$81.3 million** outstanding as of September 30, 2024, supported by **$100 million** in guarantees from AES and Siemens[313](index=313&type=chunk)[536](index=536&type=chunk) - The Tax Receivable Agreement (TRA) obligates Fluence to pay Founders **85%** of certain tax benefits, resulting in a future payable of **$107.4 million** from past redemptions and a **$1.5 million** TRA expense for FY2024[215](index=215&type=chunk)[321](index=321&type=chunk) [Critical Accounting Policies and Estimates](index=77&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Revenue recognition for energy storage products, using the percentage-of-completion method, is the most critical accounting policy, requiring significant judgment in cost inclusion and variable consideration estimation - Revenue from energy storage solutions is recognized over time using the percentage-of-completion (POC) method, based on costs incurred relative to total estimated costs[333](index=333&type=chunk) - A critical judgment involves determining when standard inventory materials, especially assembled "cubes," are integrated or restricted to a customer's project for inclusion in the POC calculation[333](index=333&type=chunk)[416](index=416&type=chunk) - The company estimates variable consideration, such as liquidated damages (LDs), using an expected value method, requiring assumptions about project delays or performance shortfalls[335](index=335&type=chunk)[337](index=337&type=chunk) [Market Risk Disclosures](index=78&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Fluence is exposed to market risks including credit risk from customer concentration, foreign currency risk from global operations, commodity price risk from raw materials, and interest rate risk from floating-rate debt - **Credit Risk**: Significant exposure from customer concentration, with two customers accounting for approximately **50%** of FY2024 revenue, mitigated by credit policies, milestone payments, and letters of credit[339](index=339&type=chunk) - **Foreign Currency Risk**: Exposure from subsidiaries operating in Euro, British pound, and Australian dollar, partially hedged using foreign currency forward contracts, especially for intercompany inventory sales[341](index=341&type=chunk) - **Commodity Price Risk**: Subject to fluctuating raw material prices (steel, aluminum, lithium) affecting component costs, with no direct hedging arrangements for these materials[342](index=342&type=chunk) - **Interest Rate Risk**: Exposure from floating-rate borrowings under the 2024 Revolver, with low risk as of September 30, 2024, due to no outstanding cash borrowings[343](index=343&type=chunk) [Financial Statements and Supplementary Data](index=80&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents audited consolidated financial statements for FY2022-2024, including balance sheets, income statements, cash flows, and notes, along with Ernst & Young LLP's audit report [Report of Independent Registered Public Accounting Firm](index=81&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) Ernst & Young LLP issued an unqualified opinion on financial statements but an adverse opinion on internal controls over financial reporting due to a material weakness in revenue recognition - The auditor, Ernst & Young LLP, issued an unqualified opinion on the consolidated financial statements[352](index=352&type=chunk) - An adverse opinion was issued on the company's internal control over financial reporting as of September 30, 2024[353](index=353&type=chunk)[364](index=364&type=chunk) - The adverse opinion stemmed from a material weakness in revenue recognition controls, specifically inconsistent application in evaluating contract terms for cost inclusion in progress measurement[365](index=365&type=chunk) - The Critical Audit Matter involved the high judgment required to determine when "cubes" (assembled battery systems) costs are restricted to a customer project and included in percentage-of-completion revenue calculation[357](index=357&type=chunk)[358](index=358&type=chunk) [Consolidated Financial Statements](index=84&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements show total assets of $1.90 billion, liabilities of $1.30 billion, and equity of $607.1 million, with FY2024 revenue of $2.70 billion and net income of $30.4 million Consolidated Balance Sheet (in thousands) | Metric | Amount (in thousands) | | :--- | :--- | | Total Assets | $1,902,188 | | Total Liabilities | $1,295,049 | | Total Stockholders' Equity | $607,139 | Consolidated Statement of Operations (in thousands) | Metric | Amount (in thousands) | | :--- | :--- | | Total Revenue | $2,698,562 | | Gross Profit | $341,080 | | Net Income | $30,367 | | Basic EPS | $0.18 | Consolidated Statement of Cash Flows (in thousands) | Metric | Amount (in thousands) | | :--- | :--- | | Net cash from operating activities | $79,685 | | Net cash used in investing activities | ($18,975) | | Net cash used in financing activities | ($8,676) | [Notes to Consolidated Financial Statements](index=94&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes provide detailed disclosures on revenue recognition, debt facilities, commitments, contingencies, related-party transactions, and stock-based compensation, supplementing the financial statements - As of September 30, 2024, the company had **$4.5 billion** in remaining performance obligations (backlog), with approximately **50%** expected to be recognized as revenue within the next 12 months (Note 3)[455](index=455&type=chunk) - The company has minimum purchase commitments of **$3.86 billion**, primarily for battery modules, extending through 2029 and beyond (Note 14)[490](index=490&type=chunk)[491](index=491&type=chunk) - Legal contingencies include an unresolved 2021 overheating event, 2023 project-related litigation, and an ongoing formal SEC investigation (Note 14)[502](index=502&type=chunk)[503](index=503&type=chunk)[504](index=504&type=chunk) - Revenue from related parties (primarily AES and Siemens affiliates) totaled **$1.1 billion** in fiscal year 2024 (Note 15)[509](index=509&type=chunk)[514](index=514&type=chunk) - Total stock-based compensation expense for fiscal year 2024 was **$23.9 million** (Note 17)[533](index=533&type=chunk) [Controls and Procedures](index=130&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were ineffective as of September 30, 2024, due to a material weakness in revenue recognition controls, with remediation efforts underway for fiscal year 2025 - Management concluded that disclosure controls and procedures were not effective as of September 30, 2024[563](index=563&type=chunk) - A material weakness was identified in internal control over revenue recognition due to inconsistent application of controls in evaluating contract terms for cost inclusion in progress measurement[569](index=569&type=chunk) - The company has enhanced controls and is working to remediate the material weakness, with expected completion in fiscal year 2025[569](index=569&type=chunk) Part III & IV [Corporate Governance and Compensation](index=132&type=section&id=Items%2010,%2011,%2012,%2013,%2014) Information for Items 10-14 (directors, compensation, governance, related parties, accountant fees) is incorporated by reference from the forthcoming 2025 Proxy Statement, and a Code of Conduct and Ethics has been adopted - Detailed information for Items 10-14 (Directors, Executive Officers, Corporate Governance, Executive Compensation, Security Ownership, Related Transactions, Principal Accountant Fees) is incorporated by reference from the forthcoming 2025 Proxy Statement[578](index=578&type=chunk)[580](index=580&type=chunk)[581](index=581&type=chunk)[582](index=582&type=chunk)[583](index=583&type=chunk) - The company has adopted a Code of Conduct and Ethics applicable to all directors, officers, and employees, available on its website[579](index=579&type=chunk) [Exhibits and Financial Statement Schedules](index=133&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists all exhibits filed with the Form 10-K, including key corporate governance, financing, and material related-party agreements - This section lists all exhibits filed with the 10-K, including key corporate governance and financing documents[586](index=586&type=chunk)[587](index=587&type=chunk) - Key agreements listed include the 2024 Credit Agreement (as amended), the Tax Receivable Agreement, and various license and purchase agreements with founders AES and Siemens[587](index=587&type=chunk)[596](index=596&type=chunk)

Financial Performance - Fluence's Q4 2024 revenue reached $1228 million, an 82% increase year-over-year[28, 30] - The company's adjusted gross profit for Q4 2024 was $159 million, up by $81 million compared to the same quarter last year[28, 31] - Adjusted EBITDA for Q4 2024 stood at $87 million, a 335% increase from the previous year[28, 31] - For fiscal year 2024, Fluence generated approximately $2700 million in revenue, a 22% increase from the prior year[10, 34] - The adjusted gross profit margin for fiscal year 2024 was 129%, primarily due to select projects delivered under budget[32, 35] - Adjusted EBITDA for fiscal year 2024 was a positive $78 million, reflecting improved gross profit margin and better project execution[32, 36] Future Outlook - Fluence anticipates revenue between $3600 million and $4400 million for fiscal year 2025, with a midpoint of $4000 million[10, 44] - The company projects adjusted EBITDA between $160 million and $200 million for fiscal year 2025, with a midpoint of $180 million[10, 44] - Fluence expects annual recurring revenue (ARR) to reach approximately $145 million by the end of fiscal year 2025[10, 44] Order and Pipeline - Order intake during Q4 2024 was approximately $1200 million, including 46 GWh of solutions, 32 GWh of services, and 45 GW of digital[10] - The company's backlog as of September 30, 2024, was $4500 million, a 55% year-over-year increase[10, 12] - Fluence's global utility-scale pipeline reached approximately $21 billion as of September 30, 2024, a 60% year-over-year increase[10, 14, 17]

Financial Data and Key Metrics - The company reported a record revenue of approximately $2.7 billion for fiscal year 2024, with a 12.6% gross margin [12] - Adjusted EBITDA for FY24 was $78 million, which is $140 million higher than FY23 and $18 million better than the midpoint of expectations [12] - Free cash flow for the year was $72 million, compared to negative $115 million in FY23 [14] - Q4 2024 revenue was $1.2 billion, an 82% increase YoY and a 154% improvement from Q3 [31] - Adjusted gross profit for Q4 was $159 million, with a gross profit margin of approximately 13% [31] - Adjusted EBITDA for Q4 was a record $87 million [31] Business Line Data and Key Metrics - The company achieved an 80% increase in annual recurring revenue (ARR) to $100 million, driven by growth in digital and services businesses [13] - The backlog grew by 55% YoY to $4.5 billion, providing strong visibility for future revenue [14] - The pipeline increased by $500 million from the previous quarter to approximately $21 billion, with nearly half in the U.S. market [19][20] Market Data and Key Metrics - Global electricity demand is projected to rise 15% to 20% in the next decade, driven by economic development, data centers, and electrification [15] - Renewables are expected to account for about 50% of global electricity production by 2030 [16] - Lithium carbonate prices declined by almost 50% YoY, reducing the cost of battery storage systems by 40% [17] - The U.S. market represents nearly half of the company's $21 billion pipeline, with the rest in international markets such as Germany, Australia, Canada, and Chile [20][21] Company Strategy and Industry Competition - The company has established a U.S. supply chain, offering 100% non-Chinese products supported by six U.S. production facilities [22][23] - The company began producing U.S.-made battery modules in September 2024, with UL1973 certification for safety and quality [24] - The company upgraded its second battery cell production line to manufacture 530-amp hour cells, doubling U.S. cell manufacturing capacity [26][27] - The company believes higher tariffs on Chinese batteries will benefit U.S.-based storage providers, giving them a competitive edge [28][29] Management Commentary on Operating Environment and Future Outlook - The company expects strong growth in the energy storage market, with a 30%+ annual growth rate for FY26 and beyond [39] - The company initiated FY25 revenue guidance with a midpoint of $4 billion, representing 50% growth from FY24 [36] - Adjusted gross profit margin for FY25 is expected to be between 10% and 15%, with an adjusted EBITDA midpoint of $180 million [37] - The company expects FY25 revenue to be back-end loaded, with 20% in the first half and 80% in the second half [38] Other Important Information - The company ended FY24 with $963 million in total liquidity, including cash and availability in credit facilities [40] - The company anticipates needing approximately $300 million in additional working capital to support future growth in FY25 [41] - The company has no debt and has flexibility in funding options, including future free cash flow and borrowing capacity [42] Q&A Session Summary Question: Backlog and Revenue Guidance for FY25 - The company has two-thirds of its FY25 revenue guidance in backlog, with $1.5 billion in late-stage negotiations, providing confidence in meeting the midpoint [51][52] - The backlog consists of binding deals with real customer commitments, and the company has seen minimal cancellations [52][53] Question: Market Share and Competition - The company maintains its market share, with Tesla and Chinese competitors being key players [56] - Innovation and a resilient supply chain are critical to maintaining a competitive edge [57] Question: Revenue Guidance and Gross Margin - The company expects FY25 revenue to be back-end loaded, with 20% in the first half and 80% in the second half [38] - Gross margin guidance for FY25 is 10% to 15%, with execution and new product launches being key factors [136][137] Question: Tariffs and Risk Management - The company has arrangements to share tariff risks with suppliers and customers, with only 10% of the backlog subject to tariff exposure [103][104] - The company has accelerated the import of foreign cells to mitigate potential tariff impacts [106] Question: Customer Demand and Domestic Content - There is strong demand for domestic content offerings, with no significant changes in customer behavior post-election [93][94] - The company has secured contracts with cell manufacturers to share tariff cost increases, further mitigating risk [28][29] Question: Pricing and Competition - The company competes on total cost of ownership, with Chinese competitors having advantages in CapEx but not in other parts of the value chain [145][146] - The company offers EPC services when needed but does not plan to expand this role significantly [150]

Core Insights - Fluence Energy, Inc. (FLNC) reported quarterly earnings of $0.34 per share, exceeding the Zacks Consensus Estimate of $0.27 per share, and showing significant improvement from earnings of $0.02 per share a year ago, resulting in an earnings surprise of 25.93% [1] - The company posted revenues of $1.23 billion for the quarter ended September 2024, which fell short of the Zacks Consensus Estimate by 4.91%, compared to revenues of $672.98 million in the same quarter last year [2] - Fluence Energy shares have underperformed the market, losing about 3.5% since the beginning of the year, while the S&P 500 has gained 25.2% [3] Earnings Outlook - The company's earnings outlook is mixed, with the current consensus EPS estimate for the coming quarter at -$0.02 on revenues of $711.42 million, and $0.53 on revenues of $3.91 billion for the current fiscal year [7] - The Zacks Rank for Fluence Energy is currently 3 (Hold), indicating that shares are expected to perform in line with the market in the near future [6] Industry Context - The Alternative Energy - Other industry, to which Fluence Energy belongs, is currently ranked in the bottom 43% of over 250 Zacks industries, suggesting that the industry's outlook may negatively impact the stock's performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Revenue and Financial Performance - Record revenue for fiscal year 2024 of approximately $2.7 billion, a 22% increase from fiscal year 2023, and Q4 revenue of approximately $1.2 billion, an 82% increase from the same quarter last year[4] - Total revenue for fiscal year 2024 reached $2,698,562 thousand, a 21.7% increase from $2,217,978 thousand in 2023[35] - Revenue for the three months ended September 2024 was $1,228,148 thousand, an 82.5% increase from $672,982 thousand in the same period of 2023[38] - Total revenue for the three months ended September 2024 was $1.23 billion, an 82% increase compared to $673 million in the same period in 2023[66] - The company achieved its highest ever revenue and profitability in 2024, with a backlog of $4.5 billion, driven by strong demand for battery energy storage solutions, particularly in the U.S. market[12] Profitability and Margins - GAAP gross profit margin improved to approximately 12.6% for fiscal year 2024 and 12.8% for Q4, compared to 6.4% and 11.3% in the previous year and quarter, respectively[5] - Gross profit for fiscal year 2024 was $341,080 thousand, a 142% increase from $140,955 thousand in 2023[35] - Gross profit margin for the three months ended September 2024 was 12.8%, up from 11.3% in the same period in 2023[66] Net Income and Earnings - Net income of approximately $30.4 million for fiscal year 2024 and $67.7 million for Q4, compared to a net loss of $104.8 million and net income of $4.8 million in the previous year and quarter, respectively[6] - Net income attributable to Fluence Energy, Inc. for fiscal year 2024 was $22,716 thousand, a significant improvement from a loss of $69,620 thousand in 2023[35] - Net income attributable to Fluence Energy, Inc. for the three months ended September 2024 was $47,843 thousand, compared to $3,229 thousand in the same period of 2023[38] - Net income for the fiscal year ended September 30, 2024, was $30.367 million, a significant improvement from a loss of $104.818 million in 2023 and $289.177 million in 2022[43] - Net income for the three months ended September 2024 was $67.7 million, a 1,306% increase compared to $4.8 million in the same period in 2023[66] Adjusted EBITDA - Adjusted EBITDA of approximately $78.1 million for fiscal year 2024 and $86.9 million for Q4, compared to negative $61.4 million and $19.8 million in the previous year and quarter, respectively[7] - Adjusted EBITDA for the three months ended September 2024 was $86.9 million, a 338% increase compared to $19.8 million in the same period in 2023[66] Cash and Liquidity - Total cash of approximately $518.7 million as of September 30, 2024, an increase of $56.0 million from September 30, 2023[8] - Cash and cash equivalents increased to $448.7 million in September 2024 from $345.9 million in September 2023, reflecting a 29.7% growth[32] - Cash, cash equivalents, and restricted cash increased to $518.706 million at the end of 2024, up from $462.731 million in 2023[45] - Net cash provided by operating activities was $79.685 million in 2024, a significant improvement from a net cash used in operating activities of $111.927 million in 2023[43] - Free Cash Flow for the fiscal year ended September 2024 was $71.6 million, a 162% increase compared to $(114.9) million in the same period in 2023[68] Backlog and Order Intake - Quarterly order intake of approximately $1.2 billion, compared to $737 million for the same quarter last year, with backlog increasing to $4.5 billion as of September 30, 2024, from $2.9 billion a year ago[8] - Order intake for energy storage products in the fiscal year ended September 30, 2024, was 5.2 GW, a 136.4% increase from 2.2 GW in 2023[52] - Contracted backlog for energy storage products grew by 63.0% to 7.5 GW in 2024, compared to 4.6 GW in 2023[52] - Contracted backlog for digital contracts rose by 55.9% to 10.6 GW in 2024, up from 6.8 GW in 2023[52] - Order intake (Contracted) represents new energy storage, service, and digital contracts, providing visibility into future revenue and sales effectiveness[58] Pipeline and Future Growth - Pipeline for energy storage products expanded by 111.5% to 25.8 GW in 2024, up from 12.2 GW in 2023[52] - Pipeline for digital contracts surged by 164.3% to 64.5 GW in 2024, compared to 24.4 GW in 2023[52] - Pipeline represents uncontracted potential revenue with a reasonable likelihood of execution within 24 months, monitored for anticipated growth[59] - Pipeline may not generate margins equal to historical operating results, and there is no guarantee it will result in actual revenue as anticipated[60] Assets and Liabilities - Total current assets grew to $1.68 billion in September 2024 from $1.19 billion in September 2023, a 40.6% increase[32] - Total assets grew to $1.9 billion in September 2024 from $1.35 billion in September 2023, a 40.7% increase[32] - Total liabilities increased to $1.3 billion in September 2024 from $795.8 million in September 2023, a 62.7% rise[32] - Total stockholders' equity grew to $607.1 million in September 2024 from $556.3 million in September 2023, a 9.1% increase[33] - Accounts payable surged to $436.7 million in September 2024 from $65.4 million in September 2023, a 567.8% increase[32] - Inventory, net, decreased to $182.6 million in September 2024 from $224.9 million in September 2023, a 18.8% decline[32] - Deferred revenue remained relatively stable at $274.5 million in September 2024 compared to $273.2 million in September 2023[32] - Intangible assets, net, increased to $60.0 million in September 2024 from $55.8 million in September 2023, a 7.6% rise[32] Expenses and Investments - Research and development expenses for fiscal year 2024 were $66,195 thousand, slightly lower than $66,307 thousand in 2023[35] - Sales and marketing expenses for fiscal year 2024 increased to $63,842 thousand, up 55.3% from $41,114 thousand in 2023[35] Comprehensive Income and Earnings Per Share - Total comprehensive income attributable to Fluence Energy, Inc. for fiscal year 2024 was $17,674 thousand, compared to a loss of $69,202 thousand in 2023[40] - Basic income per share of Class A common stock for fiscal year 2024 was $0.18, compared to a loss of $0.60 per share in 2023[35] - Total other comprehensive loss for fiscal year 2024 was $7,085 thousand, compared to a gain of $601 thousand in 2023[40] Energy Storage and Digital Contracts - Energy storage products deployed increased by 66.7% to 5.0 GW in 2024, up from 3.0 GW in 2023[52] - Assets under management for service contracts increased by 53.6% to 4.3 GW in 2024, compared to 2.8 GW in 2023[52] - Contracted backlog may not generate margins equal to historical operating results, and there is no guarantee it will result in actual revenue as anticipated[57] - Annual Recurring Revenue (ARR) represents net annualized contracted value, excluding non-recurring revenue, providing visibility to future revenue[61] - Annual recurring revenue (ARR) expected to reach approximately $145 million by the end of fiscal year 2025[10] Guidance and Future Outlook - Fiscal year 2025 revenue guidance of approximately $3.6 billion to $4.4 billion, with a midpoint of $4.0 billion, and 65% of the midpoint covered by current backlog[10] - Adjusted EBITDA guidance for fiscal year 2025 of approximately $160 million to $200 million, with a midpoint of $180 million[10]

Core Insights - Fluence Energy, Inc. reported record revenue of approximately $2.7 billion for fiscal year 2024, marking a 22% increase from fiscal year 2023, and approximately $1.2 billion for the fourth quarter, representing an 82% increase year-over-year [3][7] - The company achieved a net income of approximately $30.4 million for fiscal year 2024, a significant turnaround from a net loss of approximately $104.8 million in fiscal year 2023 [3][25] - Fluence's backlog increased to approximately $4.5 billion as of September 30, 2024, compared to approximately $2.9 billion a year earlier, indicating strong market confidence in its energy storage solutions [3][7] Fiscal Year 2024 Financial Highlights - Revenue for fiscal year 2024 was approximately $2.7 billion, with a gross profit margin of approximately 12.6% [3] - Adjusted EBITDA for fiscal year 2024 was approximately $78.1 million, a significant improvement from approximately negative $61.4 million in fiscal year 2023 [3] - Quarterly order intake reached approximately $1.2 billion, up from approximately $737 million in the same quarter last year [3] Financial Position - Total cash as of September 30, 2024, was approximately $518.7 million, an increase of approximately $56.0 million from the previous year [4] - Net cash provided by operating activities was approximately $79.7 million, compared to a negative $111.9 million for fiscal year 2023 [4] - Free cash flow for fiscal year 2024 was approximately $71.6 million, a recovery from a negative $114.9 million in fiscal year 2023 [4] Fiscal Year 2025 Outlook - The company projects revenue for fiscal year 2025 to be between approximately $3.6 billion and $4.4 billion, with a midpoint of $4.0 billion [5] - Adjusted EBITDA is expected to be between approximately $160 million and $200 million, with a midpoint of $180 million [5] - Annual recurring revenue (ARR) is anticipated to reach about $145 million by the end of fiscal year 2025 [5] Operational Metrics - Energy storage products deployed increased to 5.0 GW in fiscal year 2024, a 66.7% increase from 3.0 GW in fiscal year 2023 [31] - Contracted backlog grew to 7.5 GW, up 63.0% from 4.6 GW in the previous year [31] - The pipeline expanded significantly to 25.8 GW, representing a 111.5% increase from 12.2 GW in fiscal year 2023 [31]

Core Viewpoint - Fluence Energy, Inc. will report its earnings for the fourth quarter and fiscal year ended September 30, 2024, on November 25, 2024, after market close [1]. Group 1: Earnings Announcement - The earnings report will be followed by a teleconference on November 26, 2024, at 8:30 a.m. EST to discuss the results [2]. - Analysts must register to participate in the teleconference and are encouraged to do so at least 15 minutes before the start time [2]. Group 2: Teleconference Participation - General audience participants can join the teleconference in a listen-only mode via a webcast link or the company's website [3]. - Supplemental materials referenced during the teleconference will be available on the company's website [3]. Group 3: Replay Information - A replay of the conference call will be accessible after 1 p.m. on November 26, 2024, on the company's website [4]. Group 4: Company Overview - Fluence Energy, Inc. is a global leader in energy storage products and services, with a presence in 47 markets [5]. - The company offers modular, scalable energy storage products, comprehensive service offerings, and AI-enabled optimization software for managing renewables and storage [5]. - Fluence is focused on transforming energy systems to create more resilient and sustainable electric grids [5].

Core Viewpoint - Fluence Energy, Inc. (FLNC) is currently positioned as a stronger value investment compared to GE Vernova (GEV), based on earnings outlook and valuation metrics [1][3]. Valuation Metrics - FLNC has a forward P/E ratio of 39.03, significantly lower than GEV's forward P/E of 104.31, indicating FLNC may be undervalued [2]. - The PEG ratio for FLNC is 0.69, while GEV's PEG ratio is 4.97, suggesting FLNC has better expected earnings growth relative to its price [2]. - FLNC's P/B ratio stands at 6.64, compared to GEV's P/B of 7.56, further supporting FLNC's valuation advantage [2]. Style Scores - FLNC has a Zacks Rank of 1 (Strong Buy) and a Value grade of B, while GEV has a Zacks Rank of 2 (Buy) and a Value grade of C, indicating FLNC's superior position in terms of value investment [1][3].

Core Insights - Fluence Energy GmbH will supply a 58 MWh battery-based energy storage system to Statkraft for Germany's largest hybrid solar and storage project, enhancing renewable energy integration [1][2] - The project in Zerbst, Saxony-Anhalt, will feature a 47-megawatt solar park and a 16-megawatt battery storage system, capable of saving approximately 32,000 tonnes of CO2 emissions annually [2][3] - This initiative is part of Germany's Innovation Tenders aimed at accelerating the development of hybrid renewable assets to improve sustainability and efficiency in the energy system [3] Company and Industry Developments - This marks the sixth collaboration between Fluence and Statkraft, Europe's largest renewable energy producer, with ongoing projects in the UK and Ireland [4] - Fluence emphasizes the importance of large-scale battery storage systems for energy security and reducing curtailment, positioning itself as a key player in Germany's energy transition [5] - Fluence operates in nearly 50 markets, focusing on intelligent energy storage and optimization software to create a more resilient grid and maximize renewable energy potential [6]