SKOKIE, Ill., Oct. 23, 2025 (GLOBE NEWSWIRE) -- LanzaTech Global, Inc. (NASDAQ: LNZA) (“LanzaTech” or the “Company”) a leader in carbon transformation technology, today announced that the investors in its affiliate LanzaJet, Inc. have entered into Second Amended and Restated Investment and Stockholders’ Agreements on the long-term collaboration and the commercial rollout of sustainable aviation fuel (“SAF”).The amended agreement introduces changes in investment dynamics and share distributions. Subject to m ...

Core Insights - LanzaTech has developed a revolutionary technology that expands feedstock options for the Hydroprocessed Esters and Fatty Acids (HEFA) pathway for Sustainable Aviation Fuel (SAF), while also providing a sustainable alternative to palm oil [1][8] - The collaboration with the Fraunhofer Institute and Mibelle Group has led to the creation of a palm oil substitute that meets the functional requirements of the cosmetics industry, addressing sustainability and supply chain challenges [2][4] - The innovative dual fermentation technology converts waste CO2 into alcohol and subsequently into a palm oil-like fat, with production scaling efforts currently underway [6] Industry Context - The global reliance on palm oil has resulted in significant environmental issues, including deforestation and CO2 emissions, highlighting the need for sustainable alternatives [5] - LanzaTech's technology is positioned to play a crucial role in the decarbonization of the aviation sector by providing advanced feedstock for SAF production [7][9] - The versatility of LanzaTech's technology allows for the transformation of ethanol into synthetic oils, which can serve as alternatives to conventional HEFA feedstocks, thereby enhancing the sustainability of aviation fuels [8][9]

[Part I - Financial Information](index=4&type=section&id=Part%20I%20-%20Financial%20Information) A nature-based carbon refining company facing substantial doubt about its ability to continue as a going concern - The Company is a nature-based carbon refining company that transforms waste carbon into sustainable fuels, fabrics, and packaging using proprietary gas fermentation technology[32](index=32&type=chunk) - As of June 30, 2025, the Company's technology was operated by licensees at **four commercial-scale ethanol plants in China**, **one plant in Belgium**, **one in the commissioning phase in India**, with others currently in development[33](index=33&type=chunk) - The Company has recurring net losses and an accumulated deficit of **$(1.02) billion** as of June 30, 2025, along with cash outflows from operations of **$(42.8) million** for the six months ended June 30, 2025, raising substantial doubt about its ability to continue as a going concern[36](index=36&type=chunk)[38](index=38&type=chunk) - The Company is pursuing capital raising, partnership or asset-related opportunities, and other strategic options, including a Series A Preferred Stock Issuance and a PIPE Warrant, to address liquidity concerns[39](index=39&type=chunk)[40](index=40&type=chunk)[41](index=41&type=chunk) [Item 1. Financial Statements (unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) Presents unaudited consolidated financial statements, including balance sheets, operations, equity, cash flows, and notes [Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024](index=5&type=section&id=Consolidated%20Balance%20Sheets) | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change (in thousands) | % Change | | :--------------------------------- | :----------------------------- | :------------------------------- | :-------------------- | :--------- | | Cash and cash equivalents | $37,367 | $43,499 | $(6,132) | (14.1)% | | Total current assets | $66,151 | $99,334 | $(33,183) | (33.4)% | | Total assets | $116,296 | $174,683 | $(58,387) | (33.4)% | | Total current liabilities | $55,816 | $30,447 | $25,369 | 83.3% | | Total liabilities | $128,311 | $161,236 | $(32,925) | (20.4)% | | Total mezzanine equity | $13,169 | $0 | $13,169 | N/A | | Total shareholders' equity/(deficit)| $(25,184) | $13,447 | $(38,631) | (287.3)% | [Consolidated Statements of Operations and Comprehensive Loss for the three and six months ended June 30, 2025 and 2024](index=7&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | Change (in thousands) | % Change | | :--------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------- | :--------- | | Total revenues | $9,084 | $17,375 | $(8,291) | (47.7)% | | Total cost and operating expenses | $41,325 | $40,177 | $1,148 | 2.9% | | Loss from operations | $(32,241) | $(22,802) | $(9,439) | 41.4% | | Total other income (expense), net | $3,077 | $(3,278) | $6,355 | (193.9)% | | Net loss | $(32,499) | $(27,799) | $(4,700) | 16.9% | | Comprehensive loss | $(34,417) | $(27,990) | $(6,427) | 22.9% | | Net loss per common share - basic and diluted | $(0.15) | $(0.14) | $(0.01) | 7.1% | | Metric | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | Change (in thousands) | % Change | | :--------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------- | :--------- | | Total revenues | $18,567 | $27,619 | $(9,052) | (32.8)% | | Total cost and operating expenses | $81,861 | $76,575 | $5,286 | 6.9% | | Loss from operations | $(63,294) | $(48,956) | $(14,338) | 29.3% | | Total other income (expense), net | $21,433 | $(1,951) | $23,384 | (1198.6)% | | Net loss | $(51,728) | $(53,307) | $1,579 | (3.0)% | | Comprehensive loss | $(51,391) | $(53,457) | $2,066 | (3.9)% | | Net loss per common share - basic and diluted | $(0.25) | $(0.27) | $0.02 | (7.4)% | [Consolidated Statements of Changes in Mezzanine Equity and Shareholders' Equity/(Deficit) for the three and six months ended June 30, 2025 and 2024](index=8&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Mezzanine%20Equity%20and%20Shareholders'%20Equity%2F(Deficit)) | Metric | December 31, 2024 (in thousands) | June 30, 2025 (in thousands) | Change (in thousands) | | :--------------------------------- | :------------------------------- | :--------------------------- | :-------------------- | | Total Shareholders' Equity/(Deficit) | $13,447 | $(25,184) | $(38,631) | | Total Mezzanine Equity | $0 | $13,169 | $13,169 | | Accumulated Deficit | $(969,603) | $(1,021,331) | $(51,728) | | Common Stock Shares Outstanding | 194,915,711 | 231,995,967 | 37,080,256 | [Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and 2024](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) | Metric | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | Change (in thousands) | % Change | | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------- | :--------- | | Net cash used in operating activities | $(42,815) | $(42,942) | $127 | (0.3)% | | Net cash provided by investing activities | $11,529 | $29,502 | $(17,973) | (60.9)% | | Net cash provided by financing activities | $25,619 | $224 | $25,395 | 11337.1% | | Net decrease in cash, cash equivalents and restricted cash | $(6,092) | $(13,393) | $7,301 | (54.5)% | - Non-cash investing and financing activities for the six months ended June 30, 2025, included cashless issuance of equity for Convertible Notes (**$8.1 million**) and issuance of the Brookfield Loan (**$6.2 million**)[27](index=27&type=chunk) [Notes to the Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) [Note 1 — Description of the Business](index=13&type=section&id=Note%201%20%E2%80%94%20Description%20of%20the%20Business) LanzaTech Global, Inc. converts waste carbon into sustainable fuels and chemicals using proprietary gas fermentation - LanzaTech Global, Inc. (formerly AMCI Acquisition Corp. II) completed its business combination on February 8, 2023, and its common stock trades on Nasdaq under the ticker symbol 'LNZA'[30](index=30&type=chunk)[31](index=31&type=chunk) - The Company's core business is transforming waste carbon into sustainable fuels and chemicals (e.g., ethanol) using proprietary gas fermentation technology, and it also purchases and sells low-carbon chemicals under the brand name CarbonSmart[32](index=32&type=chunk) - As of June 30, 2025, LanzaTech's technology is operational in **four commercial-scale ethanol plants in China**, **one in Belgium**, and **one in commissioning in India**, with more under development globally[33](index=33&type=chunk) [Note 2 — Summary of Significant Accounting Policies](index=13&type=section&id=Note%202%20%E2%80%94%20Summary%20of%20Significant%20Accounting%20Policies) Outlines critical accounting policies, going concern, revenue recognition, fair value, and liquidity challenges [Going Concern](index=13&type=section&id=Going%20Concern) Recurring net losses and insufficient cash raise substantial doubt about the company's going concern ability - LanzaTech had cash and cash equivalents of **$37.4 million** and an accumulated deficit of **$(1.02) billion** as of June 30, 2025, with cash outflows from operations of **$(42.8) million** for the six months ended June 30, 2025[36](index=36&type=chunk) - The Company projects its existing cash and short-term debt securities will not be sufficient to fund operations through the next twelve months, raising substantial doubt about its ability to continue as a going concern[38](index=38&type=chunk) - The Company is actively pursuing capital raising, partnership opportunities, and other strategic options, but management concludes these plans do not alleviate substantial doubt due to market and other uncontrollable conditions[39](index=39&type=chunk)[42](index=42&type=chunk) [Significant Accounting Policies](index=15&type=section&id=Significant%20Accounting%20Policies) Significant accounting policies are consistent with the 2024 Annual Report, with no material interim changes - The Company's significant accounting policies are consistent with those included in its Annual Report on Form 10-K for the year ended December 31, 2024[46](index=46&type=chunk) [Use of Estimates](index=15&type=section&id=Use%20of%20Estimates) Financial statements require significant estimates for revenue recognition and complex financial instrument valuation - Significant estimates include revenue recognized over time, the Brookfield SAFE, the Brookfield Loan, the Forward Purchase Agreement ('FPA'), the Convertible Note, the Series A Preferred Stock and the Private Placement Warrants[47](index=47&type=chunk) - The Company uses the input method for revenue recognition, where revenue is recognized based on efforts or inputs to satisfy a performance obligation relative to total expected inputs, requiring judgment and estimation[48](index=48&type=chunk) [Cash and Cash Equivalents](index=15&type=section&id=Cash%20and%20Cash%20Equivalents) Cash and cash equivalents decreased from $43.5 million (2024) to $37.4 million (2025) - Cash and cash equivalents decreased from **$43.5 million** at December 31, 2024, to **$37.4 million** at June 30, 2025[50](index=50&type=chunk) [Restricted Cash](index=15&type=section&id=Restricted%20Cash) Restricted cash, held as collateral, increased slightly from $2.24 million (2024) to $2.28 million (2025) | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------------- | :----------------------------- | :------------------------------- | | Cash and cash equivalents | $37,367 | $43,499 | | Restricted cash (within Other current assets) | $2,278 | $2,238 | | Total cash, cash equivalents and restricted cash | $39,645 | $45,737 | [Forward Purchase Agreement](index=15&type=section&id=Forward%20Purchase%20Agreement) The FPA involves obligations for Maturity and Share Consideration, accelerated by VWAP Trigger Events, and is accounted for as equity, derivative, and debt - The FPA obligates the Company to pay Purchasers Maturity Consideration and Share Consideration, which can be accelerated if the Company's volume-weighted average share price (VWAP) falls below **$3.00** for **50 trading days** within a **60-day period** or if the Company is delisted[53](index=53&type=chunk)[56](index=56&type=chunk) - The FPA is accounted for as a reduction to equity for the prepayment, a derivative instrument (FPA Put Option) recorded as a liability at fair value, and a free-standing debt instrument (Fixed Maturity Consideration) measured using the Fair Value Option (FVO)[58](index=58&type=chunk)[59](index=59&type=chunk)[60](index=60&type=chunk) - A VWAP Trigger Event occurred on July 1, 2024, leading to Vellar accelerating its portion of the FPA and the reclassification of Maturity and Share Consideration to current liabilities. ACM's portion was fully satisfied in October 2024[61](index=61&type=chunk)[62](index=62&type=chunk) [Convertible Note](index=16&type=section&id=Convertible%20Note) A $40.15 million Convertible Note was issued in August 2024 and converted into 34 million common shares on May 7, 2025 - On August 6, 2024, the Company issued and sold a principal amount of **$40.15 million** of convertible notes to Carbon Direct Capital, electing the fair value option for accounting[65](index=65&type=chunk) - The Convertible Note was mandatorily converted into **34,054,337 shares of common stock** on May 7, 2025, following a Qualified Equity Financing with the Series A Preferred Stock Issuance[66](index=66&type=chunk) [Fair Value of Financial Instruments](index=17&type=section&id=Fair%20Value%20of%20Financial%20Instruments) Fair value is defined by a three-level hierarchy, with most financial instruments approximating carrying amounts - Fair value is measured using a three-level hierarchy: **Level 1** (quoted prices in active markets), **Level 2** (quoted prices for similar assets/liabilities or observable data), and **Level 3** (unobservable inputs)[67](index=67&type=chunk)[72](index=72&type=chunk) - The fair value of most financial instruments approximates their carrying amounts due to their short-term nature, with the exception of warrant liabilities[68](index=68&type=chunk) [Revenue Recognition](index=17&type=section&id=Revenue%20Recognition) Revenue is recognized from biorefining, R&D, grants, and CarbonSmart sales, either over time or at point of control transfer - The Company primarily earns revenue from biorefining services (feasibility studies, engineering, licensing, biocatalyst sales), joint development and contract research activities, and supply of CarbonSmart products[69](index=69&type=chunk) - Biorefining services and R&D services are recognized as performance obligations satisfied over time, using cost-to-cost or labor hours input methods, or based on milestone completion[71](index=71&type=chunk)[75](index=75&type=chunk) - CarbonSmart product sales revenue is recognized at a point in time when control transfers to the end customer, with the Company acting as the principal[78](index=78&type=chunk) - Grants are recognized as revenue as qualifying costs are incurred, and R&D services under collaborative arrangements are recognized by applying ASC 606[77](index=77&type=chunk)[79](index=79&type=chunk) [Cost of Revenues](index=19&type=section&id=Cost%20of%20Revenues) Cost of revenues includes direct R&D, engineering, and service costs related to revenue agreements, covering materials and labor - Cost of revenues represents the Company's R&D, engineering, and other direct costs of services and goods related to revenue agreements with customers, related parties, and collaborative partners[82](index=82&type=chunk) - These costs include both internal and third-party fixed and variable costs, such as materials, supplies, labor, and fringe benefits[82](index=82&type=chunk) [Research and Development](index=19&type=section&id=Research%20and%20Development) R&D costs are expensed as incurred, unless related to revenue agreements or eligible for capitalization - The Company expenses costs associated with R&D activities as incurred, unless they are related to revenue agreements or are eligible for capitalization under applicable guidance[83](index=83&type=chunk) [Concentration of Credit Risk and Other Risks and Uncertainties](index=19&type=section&id=Concentration%20of%20Credit%20Risk%20and%20Other%20Risks%20and%20Uncertainties) Significant revenue and receivables concentration from international customers and grant providers, with key customers exceeding 10% - Revenue generated from customers and grant providers outside of the United States was approximately **71%** for the three months ended June 30, 2025 (up from 36% in 2024), and **70%** for the six months ended June 30, 2025 (up from 43% in 2024)[84](index=84&type=chunk) - As of June 30, 2025, approximately **52%** of trade accounts receivable and unbilled accounts receivable were due from customers and grant providers located outside the United States[85](index=85&type=chunk) | Customer | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Customer A | 36 % | — % | 34 % | — % | | Customer B | 13 % | 51 % | 12 % | 35 % | | Customer C | — % | 17 % | — % | 15 % | [Recently Issued Accounting Pronouncements, Not Yet Adopted](index=19&type=section&id=Recently%20Issued%20Accounting%20Pronouncements,%20Not%20Yet%20Adopted) Evaluating recently issued ASUs on convertible debt, income statement disaggregation, and income tax disclosures - ASU 2024-04 (effective for annual periods beginning after December 15, 2025) provides guidance on accounting for induced conversions of convertible debt instruments, requiring any additional value given to debt holders as an inducement to be recorded as an expense[87](index=87&type=chunk) - ASU 2024-03 (effective for fiscal years beginning after December 15, 2026) will require the Company to disclose disaggregated amounts of purchases of inventory, employee compensation, depreciation, and intangible asset amortization, as well as its definition of selling expenses[88](index=88&type=chunk)[90](index=90&type=chunk) - ASU 2023-09 (effective for annual periods beginning after December 15, 2024) requires disaggregated information about a reporting entity's effective tax rate reconciliation and income taxes paid by jurisdiction[91](index=91&type=chunk) [Note 3 — Net Loss Per Share](index=20&type=section&id=Note%203%20%E2%80%94%20Net%20Loss%20Per%20Share) Basic and diluted net loss per share calculated from net loss and weighted-average shares, excluding anti-dilutive common stock equivalents | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Net loss for basic and diluted EPS (in thousands) | $(32,499) | $(27,799) | $(51,728) | $(53,307) | | Weighted-average shares outstanding (basic and diluted) | 218,121,734 | 197,746,569 | 207,377,690 | 197,360,539 | | Net loss per common share, basic and diluted | $(0.15) | $(0.14) | $(0.25) | $(0.27) | - Common stock equivalents (options, RSUs, Brookfield SAFE, and warrants) are excluded from the computation of diluted loss per share in periods of net loss because their effect would be anti-dilutive[93](index=93&type=chunk)[94](index=94&type=chunk) [Note 4 — Revenues](index=21&type=section&id=Note%204%20%E2%80%94%20Revenues) Total revenue significantly decreased for Q2 and H1 2025 due to lower licensing and engineering, offset by CarbonSmart sales | Revenue Type | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :--------------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | | Licensing | $1,050 | $8,541 | $2,101 | $9,121 | | Engineering and other services | $1,893 | $5,122 | $3,695 | $9,578 | | Joint development agreements | $1,313 | $1,333 | $2,363 | $4,205 | | Contract research | $1,010 | $1,441 | $2,386 | $2,914 | | CarbonSmart product | $3,818 | $938 | $8,022 | $1,801 | | **Total Revenue** | **$9,084** | **$17,375** | **$18,567** | **$27,619** | | Geographic Location | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :------------------ | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | | North America | $2,649 | $11,131 | $5,614 | $15,589 | | Europe, Middle East, Africa (EMEA) | $1,954 | $5,014 | $4,464 | $9,594 | | Asia | $4,481 | $826 | $8,489 | $2,032 | | Australia | $0 | $404 | $0 | $404 | | **Total Revenue** | **$9,084** | **$17,375** | **$18,567** | **$27,619** | - Contract assets decreased from **$19.0 million** to **$8.0 million**, primarily due to billing customers for engineering and other services. Current contract liabilities decreased due to satisfaction of performance obligations, while non-current contract liabilities increased due to revaluation of foreign exchange currency[99](index=99&type=chunk)[100](index=100&type=chunk) - As of June 30, 2025, the Company had approximately **$19.2 million** in contracted revenue remaining to be recognized, with **$12.1 million** expected to be recognized in the next twelve months[101](index=101&type=chunk) [Note 5 — Investments](index=23&type=section&id=Note%205%20%E2%80%94%20Investments) Investments include SGLT equity and LanzaJet equity method, with LanzaJet reduced to zero; held-to-maturity debt securities matured | Investment Type | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :---------------------- | :--------------------------- | :------------------------------- | | Equity Method Investment in LanzaJet | $0 | $4,363 | | Equity Security Investment in SGLT | $14,990 | $14,990 | | **Total Investment** | **$14,990** | **$19,353** | - The carrying value of the Company's equity method investment in LanzaJet was reduced to **zero** as of June 30, 2025, due to recording losses against the balance, and the Company will not recognize additional losses until the investment returns to a positive carrying value[111](index=111&type=chunk) - Held-to-maturity debt securities, which totaled **$12.4 million** as of December 31, 2024, had all matured by June 30, 2025[103](index=103&type=chunk) [Note 6 — Brookfield Instruments](index=24&type=section&id=Note%206%20%E2%80%94%20Brookfield%20Instruments) Brookfield SAFE terminated and replaced by Brookfield Loan on Feb 14, 2025, resulting in a $6.2 million extinguishment loss - The Brookfield SAFE was terminated on February 14, 2025, and concurrently, the Company entered into the Brookfield Loan, resulting in a **$6.2 million loss on extinguishment** of the Brookfield SAFE[121](index=121&type=chunk) - Under the Brookfield Loan, Brookfield was deemed to have loaned LanzaTech **$60.03 million** (including accrued interest from the SAFE), accruing interest at **8.00% per annum**, with an initial principal payment of **$12.5 million** made by February 21, 2025[125](index=125&type=chunk) - As of June 30, 2025, the fair value of the Brookfield Loan was **$19.4 million**, classified as a mark-to-market liability[126](index=126&type=chunk) - The Brookfield Framework Agreement, which requires LanzaTech to exclusively offer Brookfield investment opportunities in certain projects, remains in full effect, with no investments in projects as of June 30, 2025[122](index=122&type=chunk) [Note 7 — Convertible Note](index=26&type=section&id=Note%207%20%E2%80%94%20Convertible%20Note) The $40.15 million Convertible Note was converted into 34 million common shares on May 7, 2025, resulting in a $42.98 million fair value gain - On August 6, 2024, the Company issued and sold a **$40.15 million** Convertible Note to Carbon Direct Capital, bearing **8.00% annual interest**, for which the fair value option was elected[129](index=129&type=chunk)[130](index=130&type=chunk) - On May 7, 2025, the Convertible Note was mandatorily converted into **34,054,337 shares of common stock** pursuant to a Qualified Equity Financing with the Series A Preferred Stock Issuance[131](index=131&type=chunk) - The conversion resulted in an **$8.1 million fair value adjustment** booked to common stock and additional paid-in capital, and a **$43.0 million gain** from the change in fair value for the six months ended June 30, 2025[131](index=131&type=chunk) [Note 8 — Forward Purchase Agreement](index=27&type=section&id=Note%208%20%E2%80%94%20Forward%20Purchase%20Agreement) The FPA involves prepayment, a Put Option liability, and Fixed Maturity Consideration; Vellar's portion was accelerated, leading to litigation - The FPA consists of a **$60.5 million prepayment** (recorded as a reduction to additional paid-in capital), an FPA Put Option liability, and Fixed Maturity Consideration, both recorded as liabilities[134](index=134&type=chunk) - Vellar purported to accelerate its FPA Maturity Date in July 2024 due to a VWAP Trigger Event, leading to a notice of default and subsequent litigation regarding Vellar's sale of Recycled Shares[135](index=135&type=chunk) - ACM's portion of the FPA was fully satisfied in October 2024 with cash payments of **$2.5 million** for Share Consideration and **$7.5 million** for Maturity Consideration[136](index=136&type=chunk) - As of June 30, 2025, the Fixed Maturity Consideration was valued at **$4.1 million** (classified as current liability), and the FPA Put Option at **$30.0 million** (classified as non-current liability)[137](index=137&type=chunk) [Note 9 — Preferred Stock and PIPE Warrant](index=27&type=section&id=Note%209%20%E2%80%94%20Preferred%20Stock%20and%20PIPE%20Warrant) Issued 20 million Series A Preferred Stock for $40 million, classified as mezzanine equity, and agreed to a contingent PIPE Warrant for 780 million common shares - On May 7, 2025, LanzaTech issued **20,000,000 shares of Series A Preferred Stock** for **$40.0 million**, classified as mezzanine equity due to mandatory redemption provisions upon certain events (e.g., change of control) not solely within the Company's control[139](index=139&type=chunk) - The Company agreed to issue a contingent PIPE Warrant for **780,000,000 common shares**, exercisable only if specific financing conditions are met prior to May 7, 2026[141](index=141&type=chunk) - The PIPE Warrant is classified as a current liability and remeasured at fair value; its fair value increased by approximately **$3.4 million** to **$28.4 million** as of June 30, 2025, due to an increase in the Company's common stock price[142](index=142&type=chunk)[17](index=17&type=chunk) - Stockholder approvals were required for the issuance of common stock upon conversion of Series A Preferred Stock, exercise of PIPE Warrants, and a Subsequent Financing, as well as an amendment to effect a reverse stock split and authorize sufficient capital[144](index=144&type=chunk) [Note 10 — Fair Value Measurement](index=29&type=section&id=Note%2010%20%E2%80%94%20Fair%20Value%20Measurement) Details fair value hierarchy (Level 1, 2, 3) for assets and liabilities, highlighting changes for Convertible Note, Brookfield SAFE, and Loan | Financial Instrument | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--------------------------------------- | :--------------------------- | :------------------------------- | | Cash equivalents (Level 1) | $21,522 | $30,136 | | FPA Put Option liability (Level 3) | $30,015 | $30,015 | | Fixed Maturity Consideration (Level 3) | $4,123 | $4,123 | | Brookfield Loan liability (Level 3) | $19,435 | $0 | | PIPE Warrant (Level 3) | $28,350 | $0 | | Private Placement Warrants (Level 3) | $89 | $1,432 | | Public Warrants (Level 1) | $207 | $2,099 | | Convertible Note (Level 3) | $0 | $51,112 | | Brookfield SAFE liability (Level 3) | $0 | $13,223 | - The fair value of the Convertible Note's change was a **$43.0 million gain** for the six months ended June 30, 2025, with an **$8.1 million fair value adjustment** upon conversion[131](index=131&type=chunk)[152](index=152&type=chunk) - The Brookfield SAFE was extinguished on February 14, 2025, with its fair value prior to extinguishment estimated at **$13.3 million**. The Brookfield Loan's fair value was determined using a scenario-weighted discounted cash flow model, with a fair value of **$19.4 million** as of June 30, 2025[158](index=158&type=chunk)[161](index=161&type=chunk)[126](index=126&type=chunk) - The PIPE Warrant, classified as a current liability, increased in fair value by approximately **$3.4 million** to **$28.4 million** as of June 30, 2025, due to an increase in the Company's common stock price[165](index=165&type=chunk) [Note 11 — Income Taxes](index=34&type=section&id=Note%2011%20%E2%80%94%20Income%20Taxes) No income tax expense recorded for Q2 and H1 2025/2024, resulting in a 0% effective tax rate due to a full valuation allowance - The Company recorded **no income tax expense** for the three and six months ended June 30, 2025 and 2024, representing an effective tax rate of **0%**[176](index=176&type=chunk) - The **0% effective tax rate** is primarily due to a full valuation allowance related to the Company's U.S. and foreign deferred tax assets, which is reassessed on a quarterly basis[176](index=176&type=chunk) - The Company is subject to periodic income tax examinations by domestic and foreign income tax authorities, with tax years 2018 and onward subject to examination for federal purposes[177](index=177&type=chunk) [Note 12 — Share-Based Compensation](index=34&type=section&id=Note%2012%20%E2%80%94%20Share-Based%20Compensation) Grants time-based and market-based RSUs and stock options; H1 2025 compensation expenses were $2.1M for time-based RSUs, $0.4M for market-based RSUs, and $2.0M for stock options - The Company grants time-based RSUs (generally vesting over three years) and market-based RSUs (with both time-based and market-based vesting components, market component met if stock price reaches **$11.50**)[179](index=179&type=chunk)[180](index=180&type=chunk) - Stock options generally vest over **two to five years**, with exercise prices no less than the fair market value at the grant date[185](index=185&type=chunk) | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :--------------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | | Time-based RSUs compensation expense | $1,043 | $1,550 | $2,115 | $2,341 | | Market-based RSUs compensation expense | $170 | $387 | $440 | $1,114 | | Stock options compensation expense | $1,080 | $1,735 | $2,049 | $2,842 | - Unrecognized compensation costs as of June 30, 2025, include **$4.9 million** for time-based RSUs (weighted-average period of **1.34 years**), **$0.4 million** for market-based RSUs (**0.68 years**), and **$4.7 million** for stock options (**1.36 years**)[183](index=183&type=chunk)[184](index=184&type=chunk)[188](index=188&type=chunk) - Phantom RSUs and Phantom SARs, which are cash-settled and granted to certain non-US employees, are recorded as liabilities and have a graded vesting schedule over **three years**[189](index=189&type=chunk)[190](index=190&type=chunk) [Note 13 — Related Party Transactions](index=36&type=section&id=Note%2013%20%E2%80%94%20Related%20Party%20Transactions) Related party transactions with LanzaJet and SGLT involve equity, licensing, engineering, and a note receivable reduced to zero | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :---------------- | :--------------------------- | :------------------------------- | | Accounts receivable | $2,137 | $2,452 | | Contract assets | $0 | $399 | | Notes receivable | $0 | $5,789 | | Accounts payable | $0 | $234 | | Revenue Type | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :--------------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | | Revenue from related parties, included within Licensing | $1,050 | $8,541 | $2,101 | $9,121 | | Revenue from related parties, included within Engineering and other services | $137 | $332 | $258 | $660 | - The carrying amount of the note receivable from LanzaJet was reduced to **zero** as of June 30, 2025, reflecting LanzaJet's share of losses attributable to the Company, following the reduction of the equity method investment in LanzaJet to zero[207](index=207&type=chunk) - The LanzaJet Stockholders' Agreement governs board composition, share transfers, and change of control transactions, requiring parties to hold and vote shares to maintain designated board seats[198](index=198&type=chunk)[199](index=199&type=chunk)[200](index=200&type=chunk) [Note 14 — Reportable Segment](index=38&type=section&id=Note%2014%20%E2%80%94%20Reportable%20Segment) Operates as a single reportable segment, focusing on integrated solutions across biorefining, JDA/contract research, and CarbonSmart sales - LanzaTech operates as **one operating segment** and therefore **one reportable segment**, with its Chief Executive Officer serving as the Chief Operating Decision Maker (CODM)[209](index=209&type=chunk) - The single operating segment generates revenues from three business lines: biorefining, joint development agreements (JDA) and contract research, and CarbonSmart sales, all sharing technology platforms and operational resources[210](index=210&type=chunk) - The CODM primarily uses consolidated revenue and net loss to evaluate the Company's performance, allocate resources, and make strategic decisions[211](index=211&type=chunk) | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :--------------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | | Consolidated Revenues | $9,084 | $17,375 | $18,567 | $27,619 | | Consolidated Cost of Sales | $6,230 | $5,491 | $13,743 | $12,261 | | Net loss from operations | $(32,241) | $(22,802) | $(63,294) | $(48,956) | | Net Loss | $(32,499) | $(27,799) | $(51,728) | $(53,307) | [Note 15 — Commitments and Contingencies](index=39&type=section&id=Note%2015%20%E2%80%94%20Commitments%20and%20Contingencies) Faces lease commitments and litigation, including a class action, FPA disputes, and a Convertible Note conversion lawsuit, with uncertain outcomes - A partial lease termination for the corporate headquarters in May 2025 resulted in a **$13.1 million reduction** in lease liabilities and a **$60 thousand gain** recognized in other income (expense), net[216](index=216&type=chunk) - The Company is involved in a putative class action lawsuit (Schara litigation) for alleged damages from the Business Combination, with the Company voluntarily dismissed but retaining indemnification obligations for Director Defendants[219](index=219&type=chunk)[221](index=221&type=chunk) - FPA litigation with Vellar involves Vellar's purported acceleration of the FPA Maturity Date and claims of default, which the Company disputes, alleging Vellar breached FPA requirements regarding Recycled Shares[222](index=222&type=chunk)[223](index=223&type=chunk)[224](index=224&type=chunk) - Carbon Direct Capital filed a lawsuit challenging the mandatory conversion of the Convertible Note, seeking Series A Preferred Stock and PIPE Warrant instead of common stock, which was dismissed by the Supreme Court but is under appeal. A separate lawsuit regarding proxy statement misstatements was voluntarily dismissed[225](index=225&type=chunk)[227](index=227&type=chunk)[229](index=229&type=chunk) [Note 16 — Subsequent Events](index=41&type=section&id=Note%2016%20%E2%80%94%20Subsequent%20Events) Subsequent events include the OBBBA tax act, Brookfield agreement amendments, a 1-for-100 reverse stock split, and an executive transition - The One Big Beautiful Bill Act (OBBBA) was signed into law on July 4, 2025, making permanent **100% bonus depreciation**, domestic research cost expensing, and the business interest expense limitation, with the Company evaluating its impact[231](index=231&type=chunk) - On July 10, 2025, the Brookfield Framework Agreement was amended to extend its term to **December 3, 2028**, and the Brookfield Loan maturity date was extended to **December 3, 2029**, with revised interest rates (**8% then 12%** during the extension period)[232](index=232&type=chunk)[233](index=233&type=chunk) - A **1-for-100 reverse stock split** became effective on August 18, 2025, decreasing common stock par value, increasing authorized shares, and proportionately adjusting outstanding equity awards and warrant exercise prices[234](index=234&type=chunk)[237](index=237&type=chunk) - Aura Cuellar stepped down from her role as President, effective August 15, 2025, with a separation agreement including cash severance and a consulting agreement[358](index=358&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=43&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Overview of LanzaTech's business, financial developments, and performance analysis, highlighting revenue declines, increased expenses, and liquidity challenges - LanzaTech is a nature-based carbon refining company that licenses its proprietary gas fermentation technology to convert waste carbon into sustainable fuels and chemicals, augmenting its model with incremental ownership and operatorship[244](index=244&type=chunk)[245](index=245&type=chunk) - The Company has not achieved operating profitability, reporting net losses of **$51.7 million** (H1 2025) and **$53.3 million** (H1 2024), with an accumulated deficit of **$1.02 billion** as of June 30, 2025[246](index=246&type=chunk) - LanzaTech is streamlining business priorities, reducing costs, and pursuing capital raising, partnerships, and other strategic options to address liquidity concerns and continue as a going concern[247](index=247&type=chunk)[301](index=301&type=chunk) - Total revenue decreased by **48%** for the three months and **32.8%** for the six months ended June 30, 2025, primarily due to lower licensing and engineering service revenues, partially offset by increased CarbonSmart sales[264](index=264&type=chunk)[271](index=271&type=chunk) - Selling, general and administrative (SG&A) expenses increased significantly by **63%** (Q2 2025) and **53%** (H1 2025), mainly due to higher professional services fees related to business streamlining efforts[267](index=267&type=chunk)[274](index=274&type=chunk) - Net cash used in operating activities remained stable at approximately **$(42.8) million** for the six months ended June 30, 2025, while net cash provided by financing activities increased substantially to **$25.6 million** due to preferred stock issuance and PIPE Warrant proceeds[307](index=307&type=chunk)[309](index=309&type=chunk) [Overview](index=43&type=section&id=Overview) LanzaTech refines waste carbon into sustainable fuels and chemicals using proprietary gas fermentation and a licensing model with six global plants - LanzaTech transforms waste carbon into chemical building blocks for consumer goods like sustainable fuels, fabrics, and packaging using its proprietary gas fermentation technology, focusing on ethanol[244](index=244&type=chunk) - The Company employs a licensing business model where customers build, own, and operate facilities using LanzaTech's technology, paying royalty fees based on revenue, and is augmenting this with incremental ownership and operatorship[245](index=245&type=chunk) - LanzaTech has established **six commercial plants globally** (four in China, one in Belgium, one in India) and is developing capabilities to produce single cell protein and sustainable aviation fuel through a joint offering with LanzaJet (CirculAir™)[245](index=245&type=chunk) - The Company has not achieved operating profitability, reporting net losses of **$51.7 million** for the six months ended June 30, 2025, and an accumulated deficit of **$1.02 billion**[246](index=246&type=chunk) [Recent Developments](index=43&type=section&id=Recent%20Developments) Shifting to global technology deployment, streamlining operations, and pursuing liquidity initiatives, including a $40 million Series A Preferred Stock issuance and Convertible Note conversion - LanzaTech is focused on shifting its core operations from research and development to globally deploying its proven technology, streamlining business priorities, and improving its cost structure[247](index=247&type=chunk) - On May 7, 2025, the Company issued and sold **20,000,000 shares of Series A Convertible Senior Preferred Stock** for an aggregate purchase price of **$40.0 million**[248](index=248&type=chunk)[249](index=249&type=chunk) - In connection with the Series A Preferred Stock Issuance, the Company's **$40.2 million Convertible Note** was converted into **34,054,337 shares of common stock**[249](index=249&type=chunk) - The Company also agreed to issue a contingent PIPE Warrant to purchase **780,000,000 shares of common stock**, exercisable only upon consummation of a Subsequent Financing or Other Financing by May 7, 2026[250](index=250&type=chunk) - Stockholder approvals were sought for common stock issuance, a reverse stock split, and an authorized capitalization amendment, with most approvals received at the July 28, 2025 Annual Meeting[251](index=251&type=chunk)[253](index=253&type=chunk) [Key Financial Metrics](index=45&type=section&id=Key%20Financial%20Metrics) Key financial metrics show significant revenue decline for Q2 and H1 2025, reduced recurring revenue, and worsened Adjusted EBITDA | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | Variance (in thousands) | % Change | | :--------------------------------- | :-------------------------------------- | :-------------------------------------- | :---------------------- | :--------- | | Revenue | $9,084 | $17,375 | $(8,291) | (48)% | | Net Loss | $(32,499) | $(27,799) | $(4,700) | 17% | | One-Time Revenue | $7,810 | $8,834 | $(1,024) | (12)% | | Recurring Revenue | $1,274 | $8,541 | $(7,267) | (85)% | | Cost of Revenues (ex. Depreciation) | $6,230 | $5,491 | $739 | 13% | | Selling, general & administrative expense | $19,106 | $11,747 | $7,359 | 63% | | Adjusted EBITDA | $(29,696) | $(17,752) | $(11,944) | 67% | | Metric | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | Variance (in thousands) | % Change | | :--------------------------------- | :-------------------------------------- | :-------------------------------------- | :---------------------- | :--------- | | Revenue | $18,567 | $27,619 | $(9,052) | (33)% | | Net Loss | $(51,728) | $(53,307) | $1,579 | (3)% | | One-Time Revenue | $16,087 | $18,517 | $(2,430) | (13)% | | Recurring Revenue | $2,480 | $9,102 | $(6,622) | (73)% | | Cost of Revenues (ex. Depreciation) | $13,743 | $12,261 | $1,482 | 12% | | Selling, general & administrative expense | $34,854 | $22,784 | $12,070 | 53% | | Adjusted EBITDA | $(60,203) | $(39,901) | $(20,302) | 51% | [Results of Operations — Three Months Ended June 30, 2025 Compared to Three Months Ended June 30, 2024](index=47&type=section&id=Results%20of%20Operations%20%E2%80%94%20Three%20Months%20Ended%20June%2030,%202025%20Compared%20to%20Three%20Months%20Ended%20June%2030,%202024) Q2 2025 revenue decreased 48% due to lower services; R&D decreased 30%, SG&A increased 63%, and net loss rose 17% | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | Variance (in thousands) | % Change | | :--------------------------------- | :-------------------------------------- | :-------------------------------------- | :---------------------- | :--------- | | Total revenue | $9,084 | $17,375 | $(8,291) | (48)% | | Cost of revenue | $6,230 | $5,491 | $739 | 13% | | Research and development | $14,935 | $21,481 | $(6,546) | (30)% | | Selling, general and administrative expense | $19,106 | $11,747 | $7,359 | 63% | | Loss from operations | $(32,241) | $(22,802) | $(9,439) | 41% | | Other income (expense), net | $3,077 | $(3,278) | $6,355 | (194)% | | Net loss | $(32,499) | $(27,799) | $(4,700) | 17% | - The **$8.3 million decrease** in total revenue was primarily driven by a **$7.5 million decline** in licensing revenue and a **$3.2 million decrease** in engineering and other services, partially offset by a **$2.9 million increase** in CarbonSmart sales[264](index=264&type=chunk) - The **$7.4 million increase** in SG&A expense was mainly due to a **$9.5 million rise** in professional services fees associated with business streamlining, partially offset by a **$3.1 million decrease** in personnel and contractor expenses[267](index=267&type=chunk) - Other income, net, increased by **$6.7 million**, primarily due to a **$9.4 million increase** in the fair value of the Convertible Note[269](index=269&type=chunk) [Results of Operations — Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024](index=49&type=section&id=Results%20of%20Operations%20%E2%80%94%20Six%20Months%20Ended%20June%2030,%202025%20Compared%20to%20Six%20Months%20Ended%20June%2030,%202024) H1 2025 revenue decreased 32.8% due to lower services; R&D decreased 18.5%, SG&A increased 53.0%, and net loss slightly decreased 3.0% due to a Convertible Note gain | Metric | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | Variance (in thousands) | % Change | | :--------------------------------- | :-------------------------------------- | :-------------------------------------- | :---------------------- | :--------- | | Total revenue | $18,567 | $27,619 | $(9,052) | (32.8)% | | Cost of revenues | $13,743 | $12,261 | $1,482 | 12.1% | | Research and development | $31,429 | $38,542 | $(7,113) | (18.5)% | | Selling, general and administrative expense | $34,854 | $22,784 | $12,070 | 53.0% | | Loss from operations | $(63,294) | $(48,956) | $(14,338) | 29.3% | | Other income (expense), net | $21,433 | $(3,612) | $24,415 | nm | | Net loss | $(51,728) | $(53,307) | $1,579 | (3.0)% | - The **$9.1 million decrease** in total revenue was primarily due to a **$7.0 million decline** in licensing revenue and a **$5.9 million decrease** in engineering and other services, partially offset by a **$6.2 million increase** in CarbonSmart sales[271](index=271&type=chunk) - Other income, net, increased by **$24.4 million**, primarily driven by a **$43.8 million gain** related to the change in fair value of the Convertible Note, partially offset by losses from the Brookfield SAFE extinguishment and fair value changes in the Brookfield Loan[276](index=276&type=chunk)[277](index=277&type=chunk)[278](index=278&type=chunk) [Liquidity and Capital Resources](index=51&type=section&id=Liquidity%20and%20Capital%20Resources) Cash and equivalents decreased to $39.6 million; substantial doubt about going concern due to losses and insufficient capital; recent financing efforts are ongoing | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Variance (in thousands) | % Change | | :-------------------------------------- | :----------------------------- | :------------------------------- | :---------------------- | :--------- | | Total cash, cash equivalents, and restricted cash | $39,645 | $45,737 | $(6,092) | (13.3)% | - The Company has recurring net losses and an accumulated deficit of **$(1.02) billion** as of June 30, 2025, with cash outflows from operations of **$(42.8) million**, raising substantial doubt about its ability to continue as a going concern[299](index=299&type=chunk)[300](index=300&type=chunk) - Financing activities provided **$25.6 million** in cash for the six months ended June 30, 2025, primarily from the **$40.0 million Series A Preferred Stock issuance** and PIPE Warrant proceeds, partially offset by a **$12.5 million partial repayment** of the Brookfield Loan[309](index=309&type=chunk) - The Company is actively pursuing additional financing, including a Subsequent Financing of **$35.0 million to $60.0 million**, but cannot assure its timely or favorable consummation[304](index=304&type=chunk) - Litigation with Vellar regarding the FPA and with Carbon Direct Capital concerning the Convertible Note conversion introduces financial uncertainty and potential payment obligations[287](index=287&type=chunk)[225](index=225&type=chunk) [Critical Accounting Estimates](index=57&type=section&id=Critical%20Accounting%20Estimates) Critical accounting estimates involve significant judgment for Brookfield Loan, Series A Preferred Stock, and PIPE Warrant, relying on future cash flows and market conditions - There have been no significant changes in critical accounting estimates from the 2024 Annual Report, except for the measurement of the Brookfield Loan liability and Series A Convertible Senior Preferred Stock and PIPE Warrant[312](index=312&type=chunk) - The Brookfield Loan's fair value is determined using a scenario-weighted discounted cash flow model, requiring judgmental assumptions about the percentage of qualifying projects presented and funded by Brookfield, the weight on business/strategic plans, and the discount rate[313](index=313&type=chunk)[314](index=314&type=chunk) - Series A Preferred Stock is classified as mezzanine equity due to contractual provisions that could require redemption upon certain events (e.g., change of control) not solely within the Company's control, requiring significant judgment in evaluating terms and likelihood of redemption[315](index=315&type=chunk)[316](index=316&type=chunk) - The PIPE Warrant is classified as a current liability and remeasured at fair value using significant unobservable inputs and management judgment, including the probability of warrant issuance and exercisability, and applicable discounts reflecting liquidity, dilution, and financing-related risks[317](index=317&type=chunk)[318](index=318&type=chunk) [Non-GAAP Financial Measures](index=58&type=section&id=Non-GAAP%20Financial%20Measures) Adjusted EBITDA is a non-GAAP measure supplementing GAAP results, excluding non-cash and non-recurring items for operating performance insights - Adjusted EBITDA is a non-GAAP financial measure used by management and the Board to understand and evaluate operating performance, establish budgets, and develop operational goals[321](index=321&type=chunk) - Adjusted EBITDA is calculated as net loss, excluding depreciation, interest income (net), stock-based compensation expense, change in fair value of warrant liabilities, loss on Brookfield SAFE extinguishment, change in fair value of Brookfield SAFE and Loan liabilities, change in fair value of FPA Put Option liability and Fixed Maturity Consideration, change in fair value of Convertible Note, change in fair value of PIPE Warrant, and loss from equity method investees[321](index=321&type=chunk) - Adjusted EBITDA is not a substitute for GAAP measures and has limitations, as it excludes significant non-cash expenses and other items that may differ from those excluded by other companies[322](index=322&type=chunk) | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :--------------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | :-------------------------------------- | | Net Loss | $(32,499) | $(27,799) | $(51,728) | $(53,307) | | Depreciation | $1,054 | $1,458 | $1,835 | $2,988 | | Interest income, net | $(192) | $(513) | $(630) | $(1,661) | | Stock-based compensation expense and change in fair value of (1) Brookfield SAFE and warrant liabilities | $2,024 | $(3,344) | $1,372 | $(14,091) | | Loss on Brookfield SAFE extinguishment | $0 | $0 | $6,216 | $0 | | Change in fair value of the FPA Put Option and Fixed Maturity Consideration liabilities (net of interest accretion reversal) | $0 | $10,727 | $0 | $23,770 | | Change in fair value of Convertible Note | $(7,837) | $0 | $(42,980) | $0 | | Change in fair value of PIPE Warrant | $3,400 | $0 | $3,400 | $0 | | Change in fair value of Brookfield Loan | $1,019 | $0 | $12,445 | $0 | | Loss from equity method investees, net | $3,335 | $1,719 | $9,867 | $2,400 | | **Adjusted EBITDA** | **$(29,696)** | **$(17,752)** | **$(60,203)** | **$(39,901)** | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=60&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section states that there are no applicable quantitative and qualitative disclosures about market risk - This item is not applicable, indicating no quantitative and qualitative disclosures about market risk are provided[326](index=326&type=chunk) [Item 4. Controls and Procedures](index=60&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls were ineffective due to material weaknesses in complex transactions and revenue recognition, though financial statements are fairly stated - As of June 30, 2025, disclosure controls and procedures were not effective due to material weaknesses related to accounting for complex transactions and estimates requiring significant judgment, and revenue recognition[328](index=328&type=chunk) - Notwithstanding the identified material weaknesses, management concluded that the unaudited consolidated financial statements included in this Quarterly Report on Form 10-Q are fairly stated in all material respects in accordance with GAAP[329](index=329&type=chun

[Executive Summary](index=1&type=section&id=Executive%20Summary) This report provides an executive overview of LanzaTech Global, Inc.'s Q2 2025 financial and operational performance, highlighting key results and strategic initiatives [Introduction](index=1&type=section&id=Introduction) LanzaTech Global, Inc. reported Q2 2025 financial and operating results, emphasizing operational execution and strategic transformation - LanzaTech Global, Inc. (NASDAQ: LNZA) reported **Q2 2025 financial and operating results**, highlighting a focus on **operational execution and strategic transformation**[1](index=1&type=chunk) [Second Quarter 2025 Highlights](index=1&type=section&id=Second%20Quarter%20Highlights) Q2 2025 saw decreased revenue, increased net and Adjusted EBITDA losses, alongside strategic efficiency initiatives, commercial project advancements, and SAF grant funding [Financial Summary](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Results) LanzaTech reported decreased revenue and increased net and Adjusted EBITDA losses for Q2 and H1 2025 compared to prior periods Key Financial Results (Three Months Ended June 30, in millions of US dollars) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $9.1 | $17.4 | -47.7% | | Cost of revenue | $6.2 | $5.5 | +12.7% | | Operating expenses | $35.1 | $34.7 | +1.2% | | Net loss | $(32.5) | $(27.8) | +16.9% | | Adjusted EBITDA loss | $(29.7) | $(17.8) | +66.9% | Key Financial Results (Six Months Ended June 30, in millions of US dollars) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $18.6 | $27.6 | -32.6% | | Cost of revenue | $13.7 | $12.3 | +11.4% | | Operating expenses | $68.1 | $64.3 | +5.9% | | Net loss | $(51.7) | $(53.3) | -3.0% | | Adjusted EBITDA loss | $(60.2) | $(39.9) | +50.9% | [Operational and Strategic Highlights](index=1&type=section&id=Operational%20and%20Strategic%20Highlights) LanzaTech implemented efficiency measures, advanced commercial projects, and secured a £6.4 million UK grant for SAF facilities, transitioning to a commercially focused enterprise - LanzaTech announced **executive leadership transitions and workforce reductions** in May and June 2025 as part of strategic measures to scale its global business with greater **cost efficiency** and transition to a **commercially focused enterprise**[5](index=5&type=chunk) - The company is advancing **key commercial projects**, deepening **strategic partnerships**, and growing its pipeline of **carbon transformation opportunities**, including scaling **sustainable aviation fuel (SAF) production**[5](index=5&type=chunk) - LanzaTech was awarded a **£6.4 million grant** from the **UK's Advanced Fuels Fund** in July 2025 to accelerate the development of **two commercial-scale SAF facilities (DRAGON 1&2 projects)** using its **ethanol-to-jet technology**[5](index=5&type=chunk) [Detailed Financial Performance](index=2&type=section&id=Detailed%20Financial%20Performance) This section provides an in-depth analysis of LanzaTech's revenue, cost of revenue, operating expenses, net loss, and Adjusted EBITDA loss for the reporting period [Revenue Analysis](index=2&type=section&id=Revenue) Q2 2025 total revenue significantly decreased to $9.1 million, driven by lower licensing and engineering services, partially offset by CarbonSmart™ growth - Total revenue decreased by **$8.3 million (47.7%)** year-over-year in **Q2 2025**, from **$17.4 million to $9.1 million**[11](index=11&type=chunk) Revenue Breakdown (Three Months Ended June 30, in millions of US dollars) | Revenue Type | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Licensing revenue | $1.1 | $8.5 | -87.3% | | Engineering and other services revenue | $1.9 | $5.1 | -62.7% | | JDA and contract research revenue | $2.3 | $2.8 | -17.9% | | CarbonSmart revenue | $3.8 | $0.9 | +322.2% | - The significant decline in licensing revenue was primarily due to a **$7.5 million LanzaJet sublicensing revenue** received in the prior period[11](index=11&type=chunk) [Cost of Revenue Analysis](index=2&type=section&id=Cost%20of%20Revenue) Cost of revenue increased by 13% in Q2 2025 to $6.2 million, primarily due to a revenue mix shift towards lower-margin CarbonSmart sales - Cost of revenue increased by **$0.7 million (13%)** in **Q2 2025**, reaching **$6.2 million** compared to **$5.5 million** in Q2 2024[7](index=7&type=chunk) - The year-over-year increase was driven in part by a change in **revenue mix** related to **CarbonSmart sales increase**, a **lower margin business** as compared to biorefining and JDA revenues[7](index=7&type=chunk) [Operating Expense Analysis](index=2&type=section&id=Operating%20Expense) Operating expenses slightly increased to $35.1 million in Q2 2025, mainly due to higher professional fees for financing and strategic initiatives - Operating expenses were **$35.1 million** in **Q2 2025**, a slight increase from **$34.7 million** in **Q2 2024**[8](index=8&type=chunk) - The year-over-year increase was primarily due to **higher professional fees** related to **financing and strategic initiatives**[8](index=8&type=chunk) [Net Loss Analysis](index=2&type=section&id=Net%20Loss) Q2 2025 net loss increased to $32.5 million, driven by strategic option evaluation expenses and non-cash equity method losses, partially offset by financial instrument gains - Net loss for **Q2 2025** was **$32.5 million**, an increase from **$27.8 million** in **Q2 2024**[9](index=9&type=chunk) - The increase was primarily a result of **expenses associated with evaluating strategic options** and a **$3.3 million non-cash loss** recognized in **equity method investees**[9](index=9&type=chunk) - A **$6.7 million non-cash gain on financial instruments** recognized in **Q2 2025** partially offset the increase in net loss[9](index=9&type=chunk) [Adjusted EBITDA Loss Analysis](index=2&type=section&id=Adjusted%20EBITDA%20Loss) Adjusted EBITDA loss widened to $29.7 million in Q2 2025, due to higher SG&A from cost optimization, lower revenue, and increased cost of sales, with short-term restructuring impacts - Adjusted EBITDA loss was **$29.7 million** in **Q2 2025**, compared to **$17.8 million** in **Q2 2024**, representing a **66.9% increase**[10](index=10&type=chunk) - The increase was primarily attributable to **higher selling, general and administrative expenses** as a result of **cost optimization efforts**, along with **lower revenue** and **higher cost of sales** period-over-period[10](index=10&type=chunk) - **Short-term restructuring costs** impacted the quarter ended **June 30, 2025**, despite being expected to reduce long-term expenses[10](index=10&type=chunk) [Financial Position and Liquidity](index=3&type=section&id=Financial%20Position%20and%20Liquidity) This section reviews LanzaTech's balance sheet and liquidity, highlighting changes in cash, restricted cash, and investments, primarily driven by recent financing activities [Balance Sheet and Liquidity](index=3&type=section&id=Balance%20Sheet%20and%20Liquidity) Total cash, restricted cash, and investments increased to $39.6 million by June 30, 2025, primarily due to a $40.0 million preferred equity financing - As of **June 30, 2025**, the Company had **$39.6 million** in total cash, restricted cash, and investments, compared to **$23.4 million** as of **March 31, 2025**[12](index=12&type=chunk) - The increase reflects the **$40.0 million preferred equity financing** completed in **May 2025**, which bolstered **liquidity** to support near-term **operational execution** and **strategic SAF initiatives**[12](index=12&type=chunk) [Management Commentary](index=3&type=section&id=Management%20Comments) CEO Dr. Jennifer Holmgren emphasized building an efficient, scalable business with a path to profitability, streamlining operations, and prioritizing capital-light growth for SAF - **CEO Dr. Jennifer Holmgren** stated the company's focus on building a more **efficient, scalable business** with a **path to profitability**[13](index=13&type=chunk) - In Q2, LanzaTech took important steps to **streamline operations** and **shift resources toward commercial execution**, especially relating to the high-growth market for **sustainable aviation fuel (SAF)**[13](index=13&type=chunk) - The company is prioritizing **capital-light growth** through **licensing and partnerships**, supported by **strong regulatory and customer momentum**[13](index=13&type=chunk) [About LanzaTech](index=3&type=section&id=About%20LanzaTech) LanzaTech Global, Inc. is a carbon recycling company transforming waste carbon into sustainable fuels, chemicals, materials, and protein using biorecycling technology - LanzaTech Global, Inc. is the **carbon recycling company** transforming **waste carbon** into **sustainable fuels, chemicals, materials, and protein**[14](index=14&type=chunk) - Using its **biorecycling technology**, LanzaTech **captures carbon** generated by energy-intensive industries at the source, preventing it from being emitted into the air and giving it a new life as a **clean replacement for virgin fossil carbon**[14](index=14&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This section cautions that future plans and financial prospects are subject to risks and uncertainties, advising against undue reliance and noting no obligation to update except as required by law - This press release includes **forward-looking statements** regarding the **plans, strategies, and prospects**, both business and financial, of the Company, based on **management's beliefs and assumptions**[15](index=15&type=chunk) - **Forward-looking statements** are **inherently subject to risks, uncertainties, and assumptions**, and **actual results or outcomes could differ materially** from those discussed[15](index=15&type=chunk) - The Company undertakes **no obligations to update or revise publicly any forward-looking statements**, whether as a result of new information, future events or otherwise, **except as required by law**[16](index=16&type=chunk) [Non-GAAP Financial Measures Explanation](index=4&type=section&id=Non-GAAP%20Financial%20Measures) LanzaTech uses Adjusted EBITDA as a non-GAAP measure to supplement GAAP, defining it by excluding specific non-cash items from net loss, explaining its utility and limitations - LanzaTech presents **Adjusted EBITDA** as a **non-GAAP financial measure** to **supplement GAAP financial statements** and provide investors with **additional information regarding financial results**[17](index=17&type=chunk) - Adjusted EBITDA is defined as **net loss**, excluding the impact of **depreciation, interest income, stock-based compensation expense, changes in fair value of various liabilities, and loss from equity method investees**[18](index=18&type=chunk) - The company notes **limitations of Adjusted EBITDA**, including that it is **not GAAP**, may **not be comparable to other companies**, and **excludes significant non-cash expenses** like stock-based compensation and depreciation[19](index=19&type=chunk) [Consolidated Financial Statements](index=5&type=section&id=Consolidated%20Financial%20Statements) This section presents LanzaTech's consolidated balance sheets, statements of operations, and cash flows, providing a comprehensive overview of the company's financial position and performance [Consolidated Balance Sheets](index=5&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) Total assets decreased to $116.3 million by June 30, 2025, with liabilities also down, and shareholders' equity shifting to a deficit Key Balance Sheet Data (in thousands of US dollars) | Metric | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Total assets | $116,296 | $174,683 | -33.5% | | Total liabilities | $128,311 | $161,236 | -20.4% | | Total mezzanine equity | $13,169 | $0 | N/A | | Total shareholders' equity/(deficit) | $(25,184) | $13,447 | -287.4% | - **Cash and cash equivalents decreased** from **$43.5 million** at **December 31, 2024**, to **$37.4 million** at **June 30, 2025**[21](index=21&type=chunk) - **Current liabilities significantly increased** from **$30.4 million to $55.8 million**, largely due to the introduction of **PIPE Warrant liability ($28.35 million)** and **Brookfield Loan liability ($19.4 million)**[21](index=21&type=chunk) [Consolidated Statements of Operations and Comprehensive Loss](index=7&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS%20AND%20COMPREHENSIVE%20LOSS) Q2 2025 net loss increased to $32.5 million, while H1 net loss slightly decreased to $51.7 million, with total revenues declining significantly year-over-year Statements of Operations Highlights (Three Months Ended June 30, in thousands of US dollars) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total revenues | $9,084 | $17,375 | -47.7% | | Total cost and operating expenses | $41,325 | $40,177 | +2.8% | | Loss from operations | $(32,241) | $(22,802) | +41.4% | | Net loss | $(32,499) | $(27,799) | +16.9% | | Net loss per common share - basic and diluted | $(0.15) | $(0.14) | +7.1% | Statements of Operations Highlights (Six Months Ended June 30, in thousands of US dollars) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Total revenues | $18,567 | $27,619 | -32.8% | | Total cost and operating expenses | $81,861 | $76,575 | +6.9% | | Loss from operations | $(63,294) | $(48,956) | +29.3% | | Net loss | $(51,728) | $(53,307) | -3.0% | | Net loss per common share - basic and diluted | $(0.25) | $(0.27) | -7.4% | - **Selling, general and administrative expense increased significantly** to **$19.1 million** in **Q2 2025** from **$11.7 million** in **Q2 2024**[23](index=23&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) H1 2025 saw stable operating cash usage, decreased investing cash, and a substantial increase in financing cash due to preferred stock and PIPE Warrant proceeds Cash Flow Summary (Six Months Ended June 30, in thousands of US dollars) | Cash Flow Activity | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Net cash used in operating activities | $(42,815) | $(42,942) | -0.3% | | Net cash provided by investing activities | $11,529 | $29,502 | -60.9% | | Net cash provided by financing activities | $25,619 | $224 | +11337.1% | | Net decrease in cash, cash equivalents and restricted cash | $(6,092) | $(13,393) | -54.5% | - **Proceeds from issuance of preferred stock ($15.05 million)** and **PIPE Warrant ($24.95 million)** significantly **boosted financing activities** in **H1 2025**[25](index=25&type=chunk)[26](index=26&type=chunk) - **Cash, cash equivalents and restricted cash at the end of the period decreased** to **$39.6 million** in **H1 2025** from **$62.9 million** in **H1 2024**[26](index=26&type=chunk) [Supplemental Financial Disclosures](index=10&type=section&id=Supplemental%20Financial%20Disclosures) This section provides supplemental financial disclosures, including non-cash investing and financing activities and a reconciliation of GAAP net loss to Adjusted EBITDA [Supplemental Non-Cash Investing and Financing Activities](index=10&type=section&id=Supplemental%20disclosure%20of%20non-cash%20investing%20and%20financing%20activities) H1 2025 non-cash activities included cashless equity issuance for Convertible Notes, Brookfield Loan issuance, and non-cash changes in lease liability and ROU assets Supplemental Non-Cash Activities (Six Months Ended June 30, in thousands of US dollars) | Activity | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Acquisition of property, plant and equipment under accounts payable | $106 | $235 | | Right-of-use asset additions | $0 | $8,934 | | Cashless issuance of equity for Convertible Notes | $8,132 | $0 | | Issuance of the Brookfield Loan | $6,216 | $0 | | Non-cash change in lease liability on partial termination | $13,025 | $0 | | Non-cash change in ROU assets on partial termination | $(13,085) | $0 | [Reconciliation of GAAP Net Loss to Adjusted EBITDA](index=11&type=section&id=Reconciliation%20of%20GAAP%20Net%20Loss%20to%20Adjusted%20EBITDA) This reconciliation details adjustments from GAAP Net Loss to Adjusted EBITDA, with Q2 2025 adjustments including depreciation, stock-based compensation, and fair value changes, resulting in a $29.7 million Adjusted EBITDA loss Reconciliation of GAAP Net Loss to Adjusted EBITDA (Three Months Ended June 30, in thousands of US dollars) | Adjustment | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Loss | $(32,499) | $(27,799) | | Depreciation | $1,054 | $1,458 | | Interest income, net | $(192) | $(513) | | Stock-based compensation expense and change in fair value of Brookfield SAFE and warrant liabilities | $2,024 | $(3,344) | | Change in fair value of Convertible Note | $(7,837) | $0 | | Change in fair value of PIPE Warrant | $3,400 | $0 | | Change in fair value of Brookfield Loan | $1,019 | $0 | | Loss from equity method investees, net | $3,335 | $1,719 | | **Adjusted EBITDA** | **$(29,696)** | **$(17,752)** | Reconciliation of GAAP Net Loss to Adjusted EBITDA (Six Months Ended June 30, in thousands of US dollars) | Adjustment | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net Loss | $(51,728) | $(53,307) | | Depreciation | $1,835 | $2,988 | | Interest income, net | $(630) | $(1,661) | | Stock-based compensation expense and change in fair value of Brookfield SAFE and warrant liabilities | $1,372 | $(14,091) | | Loss on Brookfield SAFE extinguishment | $6,216 | $0 | | Change in fair value of FPA Put Option and Fixed Maturity Consideration liabilities | $0 | $23,770 | | Change in fair value of Convertible Note | $(42,980) | $0 | | Change in fair value of PIPE Warrant | $3,400 | $0 | | Change in fair value of Brookfield Loan | $12,445 | $0 | | Loss from equity method investees, net | $9,867 | $2,400 | | **Adjusted EBITDA** | **$(60,203)** | **$(39,901)** |

Core Insights - LanzaTech Global, Inc. reported a significant decrease in revenue for Q2 2025, totaling $9.1 million, down from $17.4 million in Q2 2024, primarily due to declines in licensing and engineering services [7][3] - The company is undergoing strategic transformations to enhance operational efficiency and profitability, including leadership changes and workforce reductions [6][14] - LanzaTech received a £6.4 million grant from the UK government to support the development of two commercial-scale Sustainable Aviation Fuel (SAF) facilities [6] Financial Performance - Revenue for the six months ended June 30, 2025, was $18.6 million, compared to $27.6 million for the same period in 2024 [3] - The cost of revenue increased by 13% year-over-year to $6.2 million in Q2 2025, influenced by a shift in revenue mix [9] - Operating expenses rose to $35.1 million in Q2 2025 from $34.7 million in Q2 2024, mainly due to higher professional fees [10] Loss Metrics - The net loss for Q2 2025 was $32.5 million, compared to $27.8 million in Q2 2024, with a notable non-cash gain on financial instruments partially offsetting losses [11] - Adjusted EBITDA loss increased to $29.7 million in Q2 2025 from $17.8 million in the same period last year, driven by higher operational costs and lower revenue [12] Balance Sheet and Liquidity - As of June 30, 2025, LanzaTech had $39.6 million in total cash and investments, up from $23.4 million as of March 31, 2025, following a $40 million preferred equity financing [13] - The total liabilities as of June 30, 2025, were $128.3 million, compared to $161.2 million in the previous year [25] Strategic Initiatives - The company is focusing on scaling its business in the sustainable aviation fuel market, leveraging its proprietary gas fermentation technology [6][14] - LanzaTech aims to align its cost structure with long-term objectives through strategic partnerships and commercial project advancements [6][14]

Core Viewpoint - LanzaTech Global, Inc. is implementing a 1-for-100 reverse stock split to regain compliance with Nasdaq's minimum bid price requirement, effective August 18, 2025 [2][3]. Group 1: Reverse Stock Split Details - The reverse stock split will reduce the number of shares from 600 million to 2.58 billion authorized shares, with a par value change from $0.0001 to $0.0000001 per share [1]. - Post-split, every 100 shares will be combined into 1 share, and fractional shares will be rounded up to the nearest whole share [3][4]. - The new CUSIP number for the common stock will be 51655R200, and trading will continue under the symbol "LNZA" [3]. Group 2: Impact on Shareholders - The reverse stock split will affect all shareholders uniformly, maintaining their percentage interest in the company's equity, except for rounding adjustments [4]. - Stockholders holding shares electronically will not need to take action to receive post-split shares, while those with brokers should contact their holders for further information [5]. Group 3: Company Overview - LanzaTech is a carbon recycling company that transforms waste carbon into sustainable fuels, chemicals, materials, and protein, utilizing biorecycling technology to capture carbon emissions [6].

Core Insights - LanzaTech Global, Inc. has received a £6.4 million grant from the UK government's Advanced Fuels Fund to advance its DRAGON 1 & 2 projects, which are essential for producing sustainable aviation fuel (SAF) in the UK [1][2][8] Group 1: Project Details - The DRAGON 1 project will convert recycled carbon fuel ethanol into Advanced SAF in Port Talbot, South Wales, utilizing the LanzaJet® Alcohol-to-Jet (AtJ) process [3] - The DRAGON 2 project will be a Power-to-Liquid (PtL) facility that converts waste carbon dioxide and green hydrogen into ethanol for subsequent conversion into PtL SAF [4] - The integration of LanzaTech's gas fermentation process with LanzaJet's AtJ technology provides a competitive advantage by transforming regional waste resources into valuable SAF [5] Group 2: Government Support and Funding - The UK government's investment in these projects highlights its confidence in LanzaTech's technology and its potential to significantly enhance the UK's SAF production [6] - The total government contributions through the Advanced Fuels Fund have now reached £198 million, aimed at expanding cleaner aviation technologies [8] - The funding supports a variety of pathways and feedstocks for SAF production, reflecting the UK government's inclusive approach to achieving net-zero aviation [8] Group 3: Strategic Partnerships and Future Outlook - LanzaTech holds a 36% ownership stake in Project Speedbird, which also received £10 million in funding from the Advanced Fuels Fund, further demonstrating government trust in LanzaTech's technology portfolio [7] - The partnership between LanzaTech and LanzaJet aims to create CirculAir™, which transforms various forms of waste carbon into SAF, providing a global solution for the aviation industry [7] - LanzaTech is committed to collaborating with the UK government and industry partners to scale solutions that convert waste carbon into sustainable growth opportunities [9]

Leadership Changes - Sushmita Koyanagi has been appointed as Chief Financial Officer, effective June 2, 2025, succeeding Justin Pugh, who served as interim CFO since January 2025 [1][3] - Amanda Fuisz will assume the role of interim General Counsel, effective June 13, 2025, succeeding Joseph Blasko [2][3] Cost Reduction and Strategic Focus - The leadership changes are part of a strategy to streamline operations and reduce costs, with anticipated annual cost reductions of approximately $1 million [5] - The company aims to better allocate resources towards promising commercial opportunities, particularly in sustainable aviation fuel production [5] Board of Directors Update - Gary Rieschel, a long-serving board member, will retire at the conclusion of his current term and will not seek re-election at the Annual Meeting of Stockholders on July 21, 2025 [4][5]

Financial Performance - For the three months ended March 31, 2025, total revenue was $9.48 million, a decrease of 7% compared to $10.24 million in the same period of 2024[226]. - Net loss for the three months ended March 31, 2025, was $19.23 million, representing a 24.6% improvement from a net loss of $25.51 million in the prior year[230]. - Adjusted EBITDA for the three months ended March 31, 2025, was $(30.51) million, a decline of 38% from $(22.15) million in the prior year[226]. - Total revenue decreased by $0.8 million, or 7.4%, for the three months ended March 31, 2025, compared to the prior year period[231]. - Engineering and other services revenue decreased by $2.7 million, while CarbonSmart sales increased by $3.3 million[231]. - Operating expenses for the three months ended March 31, 2025, totaled $33.02 million, an increase of 11.5% from $29.63 million in the same period of 2024[230]. - SG&A expenses increased by $4.7 million, or 42.7%, primarily due to higher professional fees[234]. - R&D expenses decreased by $0.6 million, or 3.3%, mainly due to a reduction in consumables and facilities expenses[233]. - Cash flows used in operating activities decreased by $7.2 million, or 25%, in the three months ended March 31, 2025, compared to the same period in 2024[264]. - The company provided $4.3 million in net cash from investing activities for the three months ended March 31, 2025, down from $9.2 million in the same period in 2024[265]. Revenue Sources - Recurring revenue increased by 115% to $1.21 million for the three months ended March 31, 2025, compared to $0.56 million in the same period of 2024[226]. - Cost of revenues increased by $0.7 million, or 11.0%, primarily due to increased sales of CarbonSmart products[232]. Cash and Liquidity - Cash and cash equivalents decreased by $29.7 million, or 64.9%, primarily due to funding net losses and loan repayments[239]. - As of March 31, 2025, the company reported cash and cash equivalents of $13.8 million, short-term held-to-maturity debt securities of $7.4 million, and an accumulated deficit of $(988.8) million[256]. - The company is projecting that its existing cash and short-term debt securities will not be sufficient to fund operations through the next twelve months, raising substantial doubt about its ability to continue as a going concern[257]. - Held-to-maturity security investments totaled $7.4 million as of March 31, 2025, down from $12.4 million as of December 31, 2024[240]. Financing Activities - The Company entered into a Series A Convertible Senior Preferred Stock Purchase Agreement on May 7, 2025, raising $40 million[221]. - The Company plans to pursue a Subsequent Financing of $35 million to $60 million at a price per share of $0.05, subject to stockholder approvals[224]. - The company entered into a Loan Agreement with Brookfield, resulting in a loan of approximately $60 million, which includes an initial principal payment of $12.5 million[254]. - The company agreed to issue and sell 20,000,000 shares of Series A Preferred Stock for an aggregate purchase price of $40 million[259]. - The company plans to pursue capital raising and other strategic options to enhance liquidity[258]. Operational Developments - The Company launched CirculAir™, a new joint offering for sustainable aviation fuel and renewable diesel, in June 2024[217]. - The Company has established multiple commercial plants globally, including in China, India, and Belgium, with ongoing developments in various countries[217]. Other Income and Expenses - Interest income, net decreased by $0.7 million due to lower cash balances[235]. - Other income, net increased by $17.7 million, driven by a $34.3 million gain from the decrease in fair value of the Convertible Note[236]. - The company repaid $12.5 million of the Brookfield Loan during the three months ended March 31, 2025[266].

Revenue Performance - Reported total revenue of $12.0 million for fourth-quarter 2024, down 41% from $20.5 million in fourth-quarter 2023, primarily due to project completions and timing delays in large biorefining projects [4] - Full-year 2024 revenue was $49.6 million, a decrease of 21% compared to $62.6 million in 2023, attributed to project completions and timing delays [4] - CarbonSmart™ revenue for fourth-quarter 2024 increased by 88% to $3.9 million, compared to $2.1 million in fourth-quarter 2023, due to new licensing arrangements [9] - Total revenues for the year ended December 31, 2024, were $49,592, a decrease of 20.9% compared to $62,631 in 2023 [23] Profitability and Losses - Gross profit for fourth-quarter 2024 was $6.5 million, resulting in a gross margin of 54%, compared to $8.5 million in fourth-quarter 2023 [7] - Net loss for fourth-quarter 2024 was $27.0 million, compared to a net loss of $18.7 million in fourth-quarter 2023 [10] - Adjusted EBITDA loss for fourth-quarter 2024 was $21.2 million, compared to a loss of $19.6 million in fourth-quarter 2023 [11] - Net loss for the year ended December 31, 2024, was $137,731, compared to a net loss of $134,098 in 2023, reflecting a slight increase in losses [23] - The company reported a total net loss of $137.731 million for the year ended December 31, 2024, compared to $134.098 million in 2023, indicating a 2.0% increase in annual losses [30] Expenses and Cash Flow - Operating expenses increased to $33.5 million for fourth-quarter 2024, up from $27.1 million in fourth-quarter 2023, driven by project-related expenses [8] - Cash and cash equivalents decreased to $43,499 as of December 31, 2024, down 42.3% from $75,585 in 2023 [20] - The company had a net cash used in operating activities of $89,060 for the year ended December 31, 2024, compared to $97,296 in 2023, indicating improved cash flow management [25] - The company incurred transaction costs of $451 thousand related to the issuance of FPA during the year [30] Assets and Liabilities - Total assets decreased to $174,683 in 2024, down 27.7% from $241,624 in 2023 [20] - Total liabilities increased to $161,236 in 2024, up 26.8% from $127,153 in 2023 [20] Research and Development - Research and development expenses for the year ended December 31, 2024, were $77,007, an increase of 13.5% compared to $68,142 in 2023 [23] Strategic Initiatives - The company is shifting its operational focus from R&D to global deployment of its technology, aiming to improve cost structure [4] - Management is evaluating liquidity-enhancing initiatives, including capital raising and strategic partnerships, to address going concern doubts [4] Shareholder Information - The weighted-average number of common shares outstanding for the year ended December 31, 2024, was 197,579,945, compared to 176,023,219 in 2023, reflecting an increase in shares [23] Other Financial Metrics - Adjusted EBITDA for the year ended December 31, 2024, was $(88.212) million, compared to $(80.144) million in 2023, indicating a 10.0% increase in losses [30] - Stock-based compensation expense for Q4 2024 was $6.191 million, while the change in fair value of SAFE and warrant liabilities was recorded as $4.679 million for the year [30] - Loss from equity method investees increased to $6.299 million in Q4 2024 from $1.961 million in Q4 2023, marking a significant rise of 220.0% [30] - Interest income, net decreased to $(710) thousand in Q4 2024 from $(1.408) million in Q4 2023, reflecting a 49.7% decline [30] - The change in fair value of the FPA Put Option and Fixed Maturity Consideration liabilities for the year was $23.283 million, down from $44.300 million in 2023 [30] - One-time costs related to the Business Combination and regulatory matters were $4.693 million in 2023, which are not expected to recur in the future [31] - Depreciation expense for the year ended December 31, 2024, was $5.567 million, slightly up from $5.452 million in 2023 [30]