Financial Performance - The company incurred a net loss of approximately $123.6 million for the three months ended March 31, 2025, with an accumulated deficit of approximately $3.5 billion since inception [128]. - The net loss attributable to common stockholders was $114.4 million in Q1 2025, a 5% improvement compared to a net loss of $120.6 million in Q1 2024 [159]. - Cash used in operating activities was $60.7 million in Q1 2025, compared to $57.9 million in Q1 2024, driven by a net loss and non-cash expenses [170][172]. - The company has not yet generated revenue and relies on equity financing to fund operations and capital expenditures [165]. Cash Flow and Resources - Cash and cash equivalents, along with marketable securities, totaled approximately $860.3 million as of March 31, 2025, down from $910.8 million at the end of 2024 [164]. - Cash provided by investing activities was $62.0 million in Q1 2025, primarily from the maturity of marketable securities, offset by purchases of securities and equipment [170][175]. - Cash provided by financing activities was $11.4 million in Q1 2025, mainly from the exercise of stock options, compared to $1.2 million in Q1 2024 [170][177]. - The company expects its cash resources to last into the second half of 2028, with a shelf registration statement allowing for an aggregate offering price of up to $1 billion [144]. - The company believes its cash resources will last into the second half of 2028, contingent on successful technology development and operational milestones [167]. Research and Development - Research and development expenses increased by 14% to $95.6 million in Q1 2025 from $83.8 million in Q1 2024, primarily due to higher depreciation and non-cash stock-based compensation [159][160]. - The company expects significant increases in research and development expenses as it ramps up engineering operations for solid-state lithium-metal batteries [151][160]. Product Development and Collaboration - The first commercial product, QSE-5, has a capacity of approximately 5 amp-hours, an energy density of over 800 Wh/L, and a fast-charging capability of 10% to 80% in less than 15 minutes [130]. - The company entered into a collaboration agreement with PowerCo, which includes an initial royalty fee of $130 million for the licensing of QSE-5 technology for automotive applications [141]. - The pilot line in San Jose, California is focused on increasing throughput and capability for manufacturing battery cells and separators [135]. - The company plans to improve the quality, consistency, and reliability of its cells through automation and process control [131]. - The automotive qualification process involves multiple sampling stages (A, B, and C samples) with timelines influenced by product development risks and OEM validation [138]. - The company is exploring opportunities in stationary storage and consumer electronics markets in addition to automotive applications [142]. Regulatory and Market Risks - Regulatory changes and trade tariffs may impact the company's ability to meet projected sales or margins, particularly with potential shifts in U.S. economic policy [147]. - There have been no material changes to the Company's market risk during the three months ended March 31, 2025 [183]. Accounting and Financial Reporting - The consolidated financial statements are prepared in accordance with U.S. GAAP, requiring significant judgment in estimates and assumptions affecting reported amounts [179]. - Critical accounting estimates are identified as those requiring complex judgments that could materially impact financial statements [180]. Administrative Expenses - General and administrative expenses decreased by 42% to $28.0 million in Q1 2025 from $48.1 million in Q1 2024, mainly due to a settlement related to litigation and reduced professional fees [159][161].

Exhibit 99.1 Q1 FISCAL 2025 LETTER TO SHAREHOLDERS April 23, 2025 Launch Program Update We continue to work closely with our prospective launch customer. As a reminder, this launch program is designed to be a low-volume but high-visibility project. It is intended to serve as a real-world vehicle demonstration, highlighting the exceptional performance characteristics of our technology platform as a step toward large-scale commercialization. The program is planned to unfold over multiple phases, with field te ...

Core Viewpoint - QuantumScape, a solid-state battery manufacturer, has faced significant challenges since its public debut, but insider buying and upcoming product developments suggest potential for recovery and investment opportunity [2][3][5]. Company Overview - QuantumScape went public via a SPAC merger on November 27, 2020, with an initial stock price of $24.80, peaking at $131.67 shortly after [2]. - The company projected revenues of $14 million in 2024, $39 million in 2025, and $275 million in 2026, but has yet to commercialize its batteries and does not expect to do so until 2026 [2][3]. Current Financial Status - The stock price has fallen to below $4, with a market capitalization of $2.1 billion, indicating that significant growth expectations are still factored into its valuation [4]. - QuantumScape has increased its outstanding shares by 57% since going public, primarily due to stock-based compensation and secondary offerings [4]. Insider Activity - Over the past three months, QuantumScape's insiders purchased nearly five times as many shares as they sold, indicating a potentially positive outlook from those with inside knowledge [5]. Product Development - QuantumScape's solid-state lithium metal batteries offer advantages over traditional lithium-ion batteries, including higher energy density (over 800 Wh/L) and faster charging times [6][7]. - The company aims to enter the electric vehicle (EV) market with its QSE-5 batteries, which are co-developed with Volkswagen, and has begun shipping prototype samples to automakers [8][9]. Challenges Ahead - The company faces challenges such as unpredictable tariffs from the Trump administration, which could impact supply chains and component prices, as well as competition from other automakers like Toyota and Nio [10][11]. - Analysts project that QuantumScape will not generate revenue in 2025 and will only achieve $3.5 million in 2026, with significant net losses expected [12]. Investment Considerations - The current low expectations from analysts mean that any positive developments in the upcoming earnings report could lead to a stock price increase [12]. - Despite being a speculative investment, there may be opportunities for gains if the company successfully upgrades its processes and commercializes its batteries by 2026 [13].

Core Insights - The electric vehicle (EV) industry has experienced a notable slowdown in sales growth since 2021, leading to increased controversy surrounding major companies in the sector [1] - QuantumScape's stock has significantly declined, with a $1,000 investment made in April 2021 now worth less than $107, reflecting a nearly 90% decrease [2] - Despite its current challenges, QuantumScape is developing a promising solid-state EV battery that offers greater range and faster charging compared to traditional lithium-ion batteries [3] Company Overview - QuantumScape is backed by Volkswagen, which has invested hundreds of millions of dollars into the company [4] - Volkswagen plans to license QuantumScape's technology for its EVs once the development stage is completed, potentially powering up to one million new vehicles annually [4] - The investment in QuantumScape is considered risky due to its pre-revenue status, but the technology shows significant promise and the partnership with Volkswagen provides financial stability [5]

Group 1: Company Overview - QuantumScape is focused on developing high-tech solid-state batteries primarily for the electric vehicle (EV) market, aiming to become an original equipment manufacturer (OEM) [2] - The company reported a loss of approximately $475 million in 2024, highlighting its focus on producing samples of its solid-state battery products [1] Group 2: Market Challenges - The automotive industry is highly regulated, with stringent safety requirements that necessitate thorough vetting of OEM suppliers by car manufacturers [3] - Established OEMs have a robust supply network, making it challenging for new entrants like QuantumScape to displace existing suppliers once a part is integrated into a vehicle [4] Group 3: Strategic Initiatives - QuantumScape is currently producing samples for automakers to test, which is crucial for gaining entry into the EV supply network [5][6] - The company has partnered with PowerCo, a battery maker under Volkswagen, to demonstrate the integration of its battery technology into Volkswagen's manufacturing processes, which could serve as a model for future partnerships [7] Group 4: Future Goals - The primary operational milestone for QuantumScape in 2025 is to ship Cobra-based B1 samples of the QSE-5 cell, which is essential for the company's path to sustainable profitability [6] - Achieving a successful partnership with Volkswagen could lead to a "first customer launch" in 2026, establishing a reliable income stream for the company [7][8]

Core Viewpoint - QuantumScape, once a high-flying stock with a market cap nearing $50 billion, has seen its shares plummet to $4, reflecting significant challenges in maintaining its competitive edge in the electric vehicle battery market [1][2]. Financial Metrics - Investors are encouraged to focus on three key financial metrics: available cash, average share totals, and net income, to assess QuantumScape's potential for recovery and growth [2][4]. Product Advantage - QuantumScape's QSE-5 solid-state batteries offer superior energy density and charging times compared to current technologies, positioning the company to benefit from the anticipated growth in electric vehicle demand [3]. Competitive Landscape - Major automakers and startups are developing their own battery solutions, increasing competition in the market, which poses a challenge for QuantumScape despite its current technological advantages [4]. R&D Investment - In response to competitive pressures, QuantumScape has more than doubled its R&D budget since 2021, but this has led to significant cash burn and widening net losses [5]. Financial Health - While QuantumScape is not on the brink of bankruptcy, it may face difficult decisions regarding taking on debt, diluting shareholders, or cutting R&D spending to manage its financial situation [6].

Core Viewpoint - QuantumScape, a solid-state battery manufacturer, has faced significant challenges, with its stock declining over 70% in the past three years due to overpromising and underdelivering on its commercialization timeline [1][2]. Company Overview - QuantumScape specializes in solid-state lithium-metal batteries, which utilize solid electrolytes, offering advantages such as higher temperature resistance and faster charging compared to traditional lithium-ion batteries, but at a higher production cost [2][3]. - The company's QSE-5 batteries boast an energy density exceeding 800 Wh/L and can charge from 10% to 80% in under 15 minutes, outperforming most lithium-ion batteries [3]. Financial Performance - QuantumScape's adjusted EBITDA remains negative, with losses widening each year, indicating ongoing financial struggles despite significant investment from Volkswagen [4][5]. - The company has an enterprise value of $1.9 billion, reflecting investor expectations for future revenue generation as it moves towards mass production [6]. Liquidity and Cash Runway - As of the end of 2024, QuantumScape reported total liquidity of $911 million, with a cash runway projected to last through the second half of 2028, suggesting a low risk of bankruptcy in the near term [7]. Future Projections - The company plans to begin shipping low-volume battery samples to select automakers in late 2024, with a goal to ship its first commercial batteries by 2026, potentially generating $4 million in revenue that year and increasing to $94 million in 2027 [8][9]. - If QuantumScape meets analysts' expectations and achieves nearly $275 million in revenue by 2028, its enterprise value could rise to $5.5 billion, potentially tripling its stock value [11]. Competitive Landscape - The solid-state battery market is rapidly evolving, with competitors like Toyota, Nio, and BYD also aiming to launch their own solid-state batteries, which could pose significant risks to QuantumScape's market position [12][13]. - Despite support from Volkswagen, QuantumScape has yet to demonstrate a sustainable business model, leaving its future uncertain [14].

Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool. ...

I had a bullish call on QuantumScape (NYSE: QS ) in December when the share price was $6.2. The stock is currently around 30% cheaper at around $4.3. I think that such a deep pullback provides a good opportunity to double-downAs an investor who started my path five years ago with my own capital, I represent a blend of hands on experience and academic background in corporate finance. Due to my relatively young age I thrive on discovering long-duration growth opportunities and actively seek out opportunities ...

Financial Performance - QuantumScape Corporation incurred a net loss of approximately $525.2 million for the year ended December 31, 2024, with an accumulated deficit of approximately $3.4 billion since inception [262]. - The net loss for 2024 was $477.9 million, a $32.8 million (7%) increase from the net loss of $445.1 million in 2023 [291]. - Total operating expenses for 2024 were $525.2 million, an increase of $46.2 million (10%) from 2023 [291]. - Cash used in operating activities for 2024 was $274.6 million, compared to $240.0 million in 2023 [303]. - Cash and cash equivalents, along with marketable securities, amounted to approximately $910.8 million as of December 31, 2024, down from $1.1 billion in 2023 [296]. Revenue and Financing Activities - During the year ended December 31, 2024, QuantumScape sold 24.9 million shares of Class A Common Stock for approximately $128.5 million in proceeds, net of issuance costs [276]. - The company completed an underwritten public offering of 37.5 million shares of Class A Common Stock in August 2023, raising approximately $288.2 million, net of issuance costs [276]. - Cash provided by financing activities for the year ended December 31, 2024, was approximately $128.5 million from the ATM offering and $20.1 million from stock options and employee stock purchase plan [314]. - For the year ended December 31, 2023, cash provided by financing activities included $288.2 million from the August 2023 Public Offering and $14.0 million from stock options and employee stock purchase plan [315]. Research and Development - The company anticipates significant increases in research and development expenses as it ramps up engineering operations to meet automotive cost targets [282]. - Research and development expenses increased by $35.0 million (10%) in 2024 compared to 2023, primarily due to personnel costs and depreciation [291]. General and Administrative Expenses - General and administrative expenses are expected to rise as QuantumScape prepares for commercialization and expands its supporting systems [284]. - General and administrative expenses rose by $11.2 million (9%) in 2024 compared to 2023, largely due to litigation settlements and legal charges [293]. Production and Product Development - The company shipped its first A0 prototype battery cells in 2022 and announced its first targeted commercial product, the QSE-5, in 2023, which has an energy density of over 800 Wh/L and fast-charging capability of 10% to 80% in under 15 minutes [264]. - In 2024, QuantumScape began producing low volumes of B-sample cells for automotive customer testing, marking a significant step in product development [264]. - The PowerCo Collaboration Agreement was signed on July 5, 2024, with an initial royalty fee of $130 million, aimed at industrializing the solid-state lithium-metal battery technology [273]. - QuantumScape's pilot line in San Jose, California, is focused on increasing throughput and capability, essential for scaling up battery cell manufacturing [268]. Cash Flow and Resources - The company expects its cash resources to last into the second half of 2028, contingent on successful technology development and operational milestones [300]. - Cash provided by investing activities in 2024 included $1.5 billion from the maturity and sale of marketable securities [310]. - The company has a finance lease commitment resulting in net cash payments of $5.3 million in the next twelve months and $39.0 million thereafter [313]. Market and Economic Conditions - The company has experienced increases in prices of raw materials, components, and labor costs due to inflation, but does not believe it has materially impacted operations to date [326]. - The company has not had material exposure to foreign currency fluctuations and has not hedged such exposure, although it may consider doing so in the future [327]. Accounting and Financial Reporting - The company’s accounting policies are prepared in accordance with U.S. GAAP, requiring judgment in making estimates that could materially impact financial statements [316]. - The company considers certain accounting estimates critical for understanding financial results due to their complexity and the subjective nature of management judgments involved [317]. - The fair values of performance-based awards are estimated using a Monte Carlo simulation model, which requires assumptions about expected term, volatility, and cost of equity [320]. - The company recognizes stock-based compensation expense based on the probability assessment of performance conditions, which may lead to significant fluctuations in recognized expenses [322].