Revenue and Financial Performance - Revenue from customers for the three months ended September 30, 2025, was $7.1 million, and for the nine months, it was $16.4 million, primarily from service-related contracts and ESS product shipments [94]. - Total operating expenses for the three months ended September 30, 2025, were $22.3 million, a decrease of 34.9% compared to the same period in 2024 [93]. - Interest income for the three months ended September 30, 2025, was $2.3 million, down from $3.7 million for the same period in 2024, reflecting a decrease of $1.4 million [109]. - Net cash used in operating activities was $48.0 million for the nine months ended September 30, 2025, primarily due to a net loss of $56.0 million [121]. - The net decrease in cash, cash equivalents, and restricted cash for the nine months ended September 30, 2025, was $93.5 million, compared to a decrease of $19.6 million for the same period in 2024 [118]. - The company expects to sustain substantial operating expenses without generating sufficient revenues for several years, relying on cash on hand and marketable securities for at least 12 months [116]. Expenses and Cost Management - Research and development expenses for the three months ended September 30, 2025, decreased by $8.8 million, or 36%, to $15.6 million compared to the same period in 2024 [100]. - General and administrative expenses decreased by $3.1 million, or 32%, to $6.7 million for the three months ended September 30, 2025, compared to $9.8 million for the same period in 2024 [106]. - Miscellaneous expenses increased to $0.7 million for the three months ended September 30, 2025, from $0.5 million for the same period in 2024, primarily due to foreign currency translation losses [111]. - Capital expenditures were $2.1 million for the nine months ended September 30, 2025, significantly lower than $12.0 million for the same period in 2024 [125]. Acquisitions and Strategic Initiatives - The acquisition of UZ Energy for approximately RMB 183.5 million ($25.8 million) is expected to enhance the company's capabilities in the ESS market [92]. - The company transitioned from developing A-Sample batteries to B-Sample batteries in 2024 to meet automotive manufacturers' requirements [90]. - The company has converted two EV A-sample production lines to focus on UAM cell production, indicating a strategic shift towards urban air mobility applications [90]. Technology and Innovation - The company achieved a 95% prediction accuracy in its AI for Safety program in 2024, meeting its target for the year [87]. - AI for Manufacturing aims to optimize cell design and improve manufacturing quality, potentially accelerating production timelines [86]. - The company believes its AI-enhanced Li-Metal battery technology can charge to 80% in less than 15 minutes, significantly reducing charging times for EVs [88]. Financial Obligations and Assets - The company had total contractual obligations of $26.2 million as of September 30, 2025, including $16.2 million in purchase obligations and $9.9 million in operating lease obligations [128]. - The Company evaluates goodwill and indefinite-lived intangible assets for impairment annually or more frequently based on ASC Topic 350, with the latest assessment indicating no impairment as of September 30, 2025 [134]. - The fair value of deferred consideration related to business combinations is determined using management judgment and contingent on future financial performance metrics [134]. - Intangible assets acquired from business combinations, including trademarks and patents, are initially measured at their estimated fair values and amortized on a straight-line basis over their estimated useful lives [133].

Core Insights - SES AI Corporation has reported its Q3 earnings, which were highly anticipated by investors due to the significant implications for the company's future performance [1]. Financial Performance - The Q3 earnings report is crucial for understanding SES's profitability and operational efficiency, which are key indicators for potential investment opportunities [1]. Investment Perspective - The focus on sustained profitability, characterized by strong margins, stable and expanding free cash flow, and high returns on invested capital, is emphasized as a more reliable driver of returns than valuation alone [1].

Core Insights - SES AI Corporation reported a quarterly loss of $0.06 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.05, representing an earnings surprise of -20.00% [1] - The company generated revenues of $7.12 million for the quarter ended September 2025, exceeding the Zacks Consensus Estimate by 42.36%, compared to zero revenues a year ago [2] - The stock has underperformed the market, losing about 5% since the beginning of the year, while the S&P 500 gained 15.1% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.05 on revenues of $5.5 million, and for the current fiscal year, it is -$0.14 on revenues of $19.81 million [7] - The estimate revisions trend for SES AI was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - SES AI operates within the Zacks Automotive - Original Equipment industry, which is currently ranked in the top 41% of over 250 Zacks industries, suggesting a favorable industry outlook [8] - The performance of SES AI's stock may be influenced by the overall industry outlook, as research indicates that the top 50% of Zacks-ranked industries outperform the bottom 50% by more than 2 to 1 [8]

Financial Data and Key Metrics Changes - The company reported a record revenue of $7.1 million for Q3 2025, representing a 102% increase from the previous quarter [4][11] - Gross margin for Q3 was 51%, with service revenue contributing a gross margin of 78% and product revenue contributing 15% [11][12] - GAAP net loss for Q3 was $20.9 million, an improvement from a loss of $22.7 million in Q2 2025 [12] Business Line Data and Key Metrics Changes - Approximately 45% of Q3 revenue came from the energy storage system (ESS) business following the acquisition of UZ Energy [6][11] - The revenue split for Q3 was approximately 55% from service revenue related to automotive OEMs and 45% from product revenue from UZ Energy [11] Market Data and Key Metrics Changes - The company expects to grow UZ Energy's revenue from approximately $10 million to $15 million in projected full-year 2025 revenue, with significant growth anticipated in the coming years [14] - The company is targeting the $300 billion global ESS market for market share gains [14] Company Strategy and Development Direction - The company is focused on an all-in-on AI strategy, highlighted by the launch of Molecular Universe 1.0, which aims to enhance battery material development [4][9] - A joint venture with Hyzen New Energy Materials was established to manufacture new electrolyte materials discovered through Molecular Universe [7][18] - The company plans to leverage its South Korea cell factory to meet the growing demand for high-energy density pouch cells in the drone market [7][36] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the revenue growth potential from Molecular Universe and its integration into various applications, including ESS and drones [9][36] - The company anticipates a doubling or tripling of total revenue in the next year due to multiple growth opportunities enabled by Molecular Universe [36] Other Important Information - The company exited Q3 with a strong liquidity position of $214 million and expects to maintain liquidity between $195 million and $200 million by the end of 2025 [13][42] - The company repurchased 1.3 million Class A shares for a total investment of $1.6 million during Q3 [12] Q&A Session Summary Question: Can you talk about the Hyzen JV opportunity? - The Hyzen JV was formed in response to requests from Molecular Universe enterprise users who wanted the company to manufacture new materials discovered through the platform [17][18] Question: How do you expect the monetization of Molecular Universe to play out? - The monetization will be a mix of SaaS platform and materials supply, with material supply expected to generate higher revenue than SaaS [21][22] Question: Can you provide an update on the trial testing of Molecular Universe? - The number of enterprise users trialing Molecular Universe has increased to nearly 40, with plans for on-premise deployment for larger enterprises [24] Question: Can you elaborate on the new enterprise tiers? - The new enterprise tiers differ in database size and model depth, catering to various customer needs from medium-sized companies to larger enterprises [29][30] Question: What is the growth outlook for UZ Energy and other revenue streams? - UZ Energy is expected to grow significantly, with potential doubling of revenue next year, alongside growth in drones and EV applications [36]

Financial Data and Key Metrics Changes - The company reported a record revenue of $7.1 million for Q3 2025, representing a 102% increase from the previous quarter [4][11] - Gross margin for Q3 was 51%, with service revenue contributing a gross margin of 78% and product revenue at 15% [11][12] - GAAP net loss for Q3 was $20.9 million, an improvement from a loss of $22.7 million in Q2 2025 [12] Business Line Data and Key Metrics Changes - The revenue split for Q3 was approximately 55% from service revenue related to automotive OEM customers and 45% from product revenue primarily from UZ Energy's energy storage system sales [11] - ESS revenue, following the acquisition of UZ Energy, accounted for about 45% of total revenue in Q3 [6] Market Data and Key Metrics Changes - The company anticipates significant growth in the energy storage system (ESS) market, projecting UZ Energy's revenue to grow from $10 million-$15 million in 2025 to potentially double in the following year [14][36] - The company is also targeting the drone market, leveraging its South Korea facility to meet the demand for high-energy density pouch cells [7][36] Company Strategy and Development Direction - The company is focused on an all-in-on AI strategy, highlighted by the launch of Molecular Universe 1.0, which aims to enhance battery material discovery and development [4][9] - A joint venture with Hyzen New Energy Materials was established to manufacture new electrolyte materials discovered through Molecular Universe, addressing specific market needs [7][18] - The company plans to expand its SaaS offerings and material supply, expecting revenue from materials to surpass SaaS revenue in the future [22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, emphasizing the transformative potential of Molecular Universe across various battery chemistries and applications [9][36] - The company expects to see a hardware-software integrated platform with multiple revenue streams, indicating a strong growth trajectory for 2026 and beyond [9][14] Other Important Information - The company exited Q3 with a strong liquidity position of $214 million, indicating sufficient capital to support growth initiatives [13][42] - The company repurchased 1.3 million Class A shares for a total investment of $1.6 million during the quarter [12] Q&A Session Summary Question: Can you talk about the Hyzen JV opportunity? - The Hyzen JV was formed in response to requests from Molecular Universe enterprise users, aiming to supply new electrolyte formulations discovered through the platform [17][18] Question: How do you expect the monetization of Molecular Universe to play out? - The monetization will be a mix of SaaS revenue and material supply, with material supply expected to generate higher revenue than SaaS [21][22] Question: Can you provide an update on the trial testing of Molecular Universe? - The number of enterprise users trialing Molecular Universe has increased to nearly 40, with plans for on-premise deployment for larger companies [24] Question: What are the different subscription options for Molecular Universe? - The company offers various enterprise tiers based on the depth of models and database size, with options for joint development for larger customers [29][31] Question: What is the growth outlook for UZ Energy and other revenue streams? - UZ Energy is expected to see significant growth, with potential doubling of revenue next year, alongside growth in the drone and EV markets [36]

Financial Data and Key Metrics Changes - The company reported a record revenue of $7.1 million for Q3 2025, representing a 102% increase from the previous quarter [4][11] - Gross margin for Q3 was 51%, with service revenue from automotive OEMs contributing a gross margin of 78% and product revenue from UZ Energy at 15% [11][12] - GAAP net loss for Q3 was $20.9 million, an improvement from a loss of $22.7 million in Q2 2025 [12] Business Line Data and Key Metrics Changes - Approximately 45% of Q3 revenue was attributed to the energy storage system (ESS) business following the acquisition of UZ Energy [6] - The company launched three sub-tiers within its enterprise offerings to provide greater value to enterprise users [5][30] Market Data and Key Metrics Changes - The company expects to grow UZ Energy's revenue from an estimated $10 million-$15 million in 2025 to a significantly larger figure in the coming years [13] - The global ESS market is projected to be worth $300 billion, presenting substantial growth opportunities for the company [13] Company Strategy and Development Direction - The company is focused on an all-in-on AI strategy, with the recent launch of Molecular Universe 1.0 aimed at enhancing its product offerings [4][9] - A joint venture with Hyzen New Energy Materials was established to manufacture new electrolyte materials discovered through Molecular Universe [7][18] - The company aims to integrate hardware and software solutions to create a multi-revenue stream platform [9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the revenue growth potential from Molecular Universe and its applications across various battery chemistries [9][15] - The company anticipates a doubling or tripling of revenue in 2026 due to multiple growth opportunities in ESS, drones, and EV applications [36][37] Other Important Information - The company exited Q3 with a strong liquidity position of $214 million, allowing for sustainable growth and long-term success [12][15] - The company repurchased 1.3 million Class A shares for a total investment of $1.6 million during Q3 [12] Q&A Session Summary Question: Can you talk about the Hyzen JV and its opportunities? - The Hyzen JV was formed in response to requests from Molecular Universe users, aiming to supply new formulations discovered through the platform [17][18] Question: How do you expect the monetization of Molecular Universe to play out? - The monetization will be a mix of SaaS platform and materials supply, with expectations for growing subscription revenue and material sales [20][23] Question: What is the status of the trials with battery companies? - The number of enterprise users trialing Molecular Universe has increased to nearly 40, with plans for on-premise deployments [24][25] Question: Can you elaborate on the new enterprise tiers? - The new enterprise tiers differ in database size and model depth, catering to various customer needs [30][31] Question: What are the growth prospects for UZ Energy? - UZ Energy is expected to see significant revenue growth, with projections to double in the coming year [36] Question: What is the roadmap for Molecular Universe in 2026? - Future developments will include expanding features to cover electrode and process optimization, as well as creating portable versions for battery companies [45] Question: What is the status of pouch cells for drones? - The company is converting its production line to meet the growing demand for pouch cells, particularly for drones [46]

Financial Results - SES AI Corporation released its financial results for the fiscal quarter ended September 30, 2025, on November 5, 2025[4]. - The report does not include specific financial metrics or performance indicators for the quarter[6]. Shareholder Communication - The company issued a letter to shareholders detailing a business update alongside the financial results[4]. - The letter to shareholders is furnished as Exhibit 99.1, while the press release is Exhibit 99.2[7]. - The press release announcing the shareholder letter was also issued on November 5, 2025[5]. Company Information - The company is listed on the New York Stock Exchange under the symbol SES for Class A common stock and SES WS for warrants[2]. - SES AI Corporation is incorporated in Delaware and has an IRS Employer Identification Number of 88-0641865[1]. - The exercise price for the warrants is set at $11.50 per share[2]. - The report was signed by Jing Nealis, the Chief Financial Officer of SES AI Corporation[11]. Compliance and Standards - The company has not elected to use the extended transition period for complying with new financial accounting standards[3].

Core Insights - SES AI Corporation reported a revenue of $7.1 million for the third quarter of 2025, marking an increase of $3.6 million compared to the second quarter of 2025 [1] Financial Performance - The company affirmed its previously issued financial guidance for the year ending December 31, 2025 [1]

Core Viewpoint - SES AI Corporation, a leader in AI-enhanced battery technology, is set to release its Q3 2025 financial results on November 5, 2025, after market close [1] Financial Results Announcement - The financial results will be announced after market close on November 5, 2025 [1] - A conference call is scheduled for the same day at 5:00 p.m. ET [1] - A live webcast of the conference call will be accessible through SES's Investor Relations website [1]

Core Insights - SES AI's stock surged by 77.7% during the week, driven by investor anticipation of potential U.S. government investment [1][2] - The company launched an AI-powered software for battery material discovery, which has attracted significant investor interest [2][3] Company Developments - SES AI specializes in using AI to discover electrolyte materials and develop lithium-metal and lithium-ion batteries, applicable in electric vehicles, energy storage, drones, and robotics [3][4] - The company is set to launch an advanced version of its software, Molecular Universe 1.0 (MU-1), on October 20, which will cover a broader range of electrolytes and target new markets such as oil and gas, specialty chemicals, and personal care [5][6] - SES AI aims to transition to a subscription-based model for MU-1, with positive initial responses and revenue generation from joint development customers [6] Market Context - The combination of AI and lithium has captivated the market, particularly in light of recent strategic moves by the U.S. government in critical materials [7] - Despite investor hopes for a strategic investment from the U.S. government, the company's operations are primarily outside the U.S., which may limit such opportunities [8] - SES AI projects significant revenue growth, estimating an increase of 7 to 13 times this year, driven by subscription revenue from MU-1 [8]