[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]

Financial Performance - LanzaTech reported total revenue of $9.5 million for Q1 2025, a decrease from $10.2 million in Q1 2024, primarily due to lower revenues in biorefining and Joint Development Agreement (JDA) & Contract Research businesses, partially offset by a significant increase in CarbonSmart revenue [5][6] - Biorefining revenue decreased to $2.9 million in Q1 2025 from $5.0 million in Q1 2024, attributed to the completion of engineering and service contracts [6] - JDA & Contract Research revenue fell to $2.4 million in Q1 2025 from $4.3 million in Q1 2024, due to the completion of certain government projects [6] - CarbonSmart revenue increased significantly to $4.2 million in Q1 2025 from $0.9 million in Q1 2024, driven by direct fuel sales and new licensing arrangements [6] Cost and Expenses - The cost of revenue for Q1 2025 was $7.5 million, up from $6.8 million in Q1 2024, influenced by a change in revenue mix and margin contraction in the biorefining business [7] - Operating expenses rose to $33.0 million in Q1 2025 from $29.6 million in Q1 2024, primarily due to costs associated with business focus and strategic evaluations [8] Net Loss and Adjusted EBITDA - The net loss for Q1 2025 was $19.2 million, an improvement from a net loss of $25.5 million in Q1 2024, mainly due to a non-cash gain on financial instruments [9] - Adjusted EBITDA loss increased to $30.5 million in Q1 2025 from $22.1 million in Q1 2024, attributed to higher selling, general and administrative expenses and lower revenue [10] Balance Sheet and Liquidity - As of March 31, 2025, LanzaTech had $23.4 million in total cash and investments, down from $58.1 million at the end of 2024 [11] - The company closed $40 million of preferred equity capital in May 2025, but ongoing liquidity initiatives raise concerns about its ability to continue as a going concern [5][11] Company Overview - LanzaTech Global, Inc. is focused on transforming waste carbon into sustainable fuels, chemicals, materials, and protein through its biorecycling technology [12]

Financial Data and Key Metrics Changes - The company reported a 2.3% increase in ID sales for Q4 2024, with adjusted EBITDA of $855 million and adjusted earnings per share of $0.46, compared to $916 million and $0.54 in Q4 2023 respectively [11][30][33] - Gross margin for Q4 was 27.4%, a decrease of 45 basis points year-over-year, primarily due to strong pharmacy sales and increased digital delivery costs [28][30] - Selling and administrative expense rate was 25.7%, with a slight decrease of five basis points compared to the previous year, driven by lower merger-related costs [29][30] Business Line Data and Key Metrics Changes - E-commerce sales grew by 24% in Q4, with penetration now over 8% of grocery revenue, indicating significant growth potential compared to industry peers [12][13] - Pharmacy revenue increased by 18% year-over-year, driven by script and immunization growth [15][28] - Loyalty membership grew by over 15% year-over-year, reaching more than 45 million members, with actively engaged customers increasing by 12% [13][14] Market Data and Key Metrics Changes - The company is experiencing inflationary pressures, leading to increased customer demand for value, prompting strategic price investments in certain categories [19][43] - The competitive environment remains challenging, with pressures from mass and club stores, yet customer traffic has increased [84] Company Strategy and Development Direction - The company is focused on its "Customers for Life" strategy, emphasizing digital engagement, enhancing customer value propositions, and modernizing capabilities through technology [8][32] - Significant investments are planned for digital growth, the Albertsons Media Collective, and health and pharmacy initiatives [33][34] - The company aims to achieve $1.5 billion in productivity savings from FY 2025 to FY 2027, which will be reinvested into growth initiatives [22][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strategy and its ability to navigate inflationary pressures while continuing to invest in customer engagement and technology [32][36] - The outlook for FY 2025 includes ID sales growth of 1.5% to 2.5% and adjusted EBITDA in the range of $3.8 billion to $3.9 billion [33][34] Other Important Information - The company plans to maintain its quarterly dividend and return excess cash to shareholders through opportunistic share repurchases, with a $2 billion share repurchase program authorized [35][34] - The company contributed over $435 million in food and financial support to communities in 2024, including a new goal to enable 1.5 billion meals by 2030 [26] Q&A Session Summary Question: Update on price gaps and competitive environment - Management noted no dramatic shifts in consumer behavior but acknowledged a shift towards value and promotions, with a surgical approach to price investments [43][44] Question: Buybacks within guidance - Management confirmed that the guidance includes assumptions for share repurchases, estimating approximately $0.06 of accretion in EPS each year if repurchased evenly over three years [46] Question: Proportion of imported goods and tariff impacts - The company procures over 90% of its products domestically, with ongoing monitoring of tariff impacts on costs [50][51] Question: Key investment areas for 2025 - Investments will focus on digital growth, loyalty programs, and enhancing customer value propositions, with a thoughtful cadence throughout the year [58][61] Question: Q1 performance expectations - Management indicated that Q1 may be softer due to ongoing investments, but consumer behavior remains stable with a focus on value [62][64] Question: Pharmacy growth outlook and GLP-1 impact - GLP-1s contribute to pharmacy growth, but core script volume is also increasing, providing opportunities for deeper customer engagement [93][96] Question: Gross margin outlook and reinvestment of savings - Management expects pressure on gross margin in 2025 but anticipates offsetting benefits from productivity initiatives [82][84]

Environmental Impact and Sustainability - The company has produced over 75 million gallons of fuel-grade ethanol, mitigating over 500,000 tons of CO₂ emissions since May 2018[28]. - The first commercial facility in China utilizing the company's technology has sold over 65.9 million gallons of ethanol, displacing fossil gasoline and avoiding over 240,000 tons of CO₂ emissions[36]. - The company aims to produce CarbonSmart materials, removing approximately two tons of CO₂ for every ton of CarbonSmart product produced[33]. - Ethanol produced can demonstrate up to 85% GHG reduction compared to fossil alternatives, depending on various factors[61]. - The integration of bio-based industrial CO₂ and DAC technologies with the gas fermentation platform is expected to significantly reduce emissions, achieving a 94% reduction compared to fossil counterparts[51]. - The company expects the adoption of CarbonSmart products to grow significantly, contributing to the decarbonization of multiple industries[60]. Technology and Intellectual Property - The company has a strong intellectual property position with 1,193 granted patents and 515 pending applications as of December 31, 2024[37]. - The company’s technology can utilize diverse waste feedstocks, potentially yielding up to 6.5 billion metric tons of gas fermentation products annually, primarily ethanol[45]. - The company has established partnerships with industry leaders, validating its technology through over 100,000 hours of pilot and demonstration-scale operations[36]. - The Shougang Joint Venture License Agreement allows the joint venture to utilize the company's intellectual property for ethanol production, with the agreement continuing until the last commercial facility is decommissioned[97]. Financial Performance and Position - The company reported cash outflows from operations of $(89.1) million and a net loss of $(137.7) million for the year ended December 31, 2024[124]. - The company incurred net losses of approximately $137.7 million for the year ended December 31, 2024, and $134.1 million for the year ended December 31, 2023, with an accumulated deficit of $969.6 million as of December 31, 2024[134]. - As of December 31, 2024, the company had cash and cash equivalents of $43.5 million, short-term held-to-maturity debt investments of $12.4 million, and an accumulated deficit of $(969.6) million[124]. - The largest contracting entity accounted for 25% of the company's revenue for the fiscal year ended December 31, 2024, down from 38% in 2023[70]. - The company has historically funded its operations through a combination of business combinations, equity securities issuances, and debt financing[126]. Partnerships and Collaborations - The company holds approximately 36.33% of the outstanding shares of LanzaJet as of December 31, 2024, with potential to increase to approximately 46% and 53% with future investments[73]. - The Mitsui Alliance Agreement mandates Mitsui to promote the company's gasification and waste-to-ethanol technology in Japan, while the company must exclusively recommend Mitsui for investment and off-take services[86][88]. - The Brookfield Framework Agreement requires the company to present projects needing at least $500 million in equity funding to Brookfield, with no obligation for Brookfield to invest[99]. - LanzaJet has received a total commitment of up to $120 million from partners, with $45 million already invested in the initial demonstration facility at the LanzaTech Freedom Pines Biorefinery in Soperton, Georgia[160]. Regulatory and Compliance Risks - The company faces risks related to regulatory changes that could impact its operations and financial condition, particularly concerning GHG emissions and chemical regulations[120]. - The company is subject to extensive laws and regulations, and any changes could materially affect its ability to manufacture and commercialize products[194]. - The company may incur significant expenses related to product liability claims if defects in products produced using its process technologies are discovered post-sale[205]. - Compliance with environmental, health, and safety laws is costly and time-consuming, with potential liabilities exceeding total assets in case of violations[204]. - The company is subject to additional regulations and audits related to government grants, which could affect revenue and operational results[159]. Market and Competitive Landscape - The market values for monoethylene glycol (MEG) and polyethylene terephthalate (PET) are estimated at $24.8 billion and $41 billion, respectively, in 2023[33]. - The commercial success of the company may be influenced by the price of fossil feedstocks relative to waste-based feedstocks, which are subject to historical price fluctuations[165]. - The cost structure and gross margin of the company are highly dependent on the prices of waste-based feedstocks, which are cyclical and volatile[166]. - The company faces substantial indirect competition from firms with greater resources and brand recognition, which could adversely affect its market share[171]. - Technological advancements by competitors could render the company's technology and products obsolete or uneconomical[174]. Operational Challenges - Construction of commercial-scale plants is essential for projected financial performance, and any delays or cost overruns could severely impact the company's business and financial condition[149][150]. - The company must continuously reduce operating and capital costs for its facilities to ensure the adoption of its process technologies; failure to do so could harm its business prospects[152]. - The company continues to face significant risks associated with its international expansion strategy, including compliance with diverse legal environments and potential economic instability in foreign countries[147][148]. - The company may not successfully identify new market opportunities, limiting prospects and increasing dependency on a smaller number of target products[181]. Future Outlook and Strategic Direction - The company is focused on shifting its core operations from research and development to globally deploying its proven technology[117]. - The company is currently evaluating options to enhance its liquidity position with financing due to substantial doubt about its ability to continue as a going concern[127]. - A preliminary, nonbinding proposal was received from Carbon Direct Capital to acquire all outstanding shares of the company's common stock for $0.02 per share[118]. - The exploration of the potential take-private transaction has diverted management's time and attention, which may impact day-to-day business operations and results[133]. - The company expects to finalize commissioning of a commercial scale facility with IndianOil in the coming months[192].