Stem(US:STEM)2024-10-30 23:23Financial Performance - Total revenue decreased from $133.7 million for the three months ended September 30, 2023, to $29.3 million for the same period in 2024, representing a decline of approximately 78%[94] - Net losses for the three months ended September 30, 2024, were $148.3 million, compared to net losses of $77.1 million for the same period in 2023, indicating an increase in losses of about 92%[94] - For the nine months ended September 30, 2024, total revenue was $88.8 million, down from $294.1 million for the same period in 2023, a decrease of approximately 70%[94] - The company incurred net losses of $802.9 million for the nine months ended September 30, 2024, compared to $102.7 million for the same period in 2023, reflecting a significant increase in losses[94] - Revenue for the three months ended September 30, 2024, was $29.3 million, a decrease from $133.7 million for the same period in 2023, representing a decline of approximately 78%[112] - Non-GAAP gross profit for the three months ended September 30, 2024, was $16.2 million, compared to $21.4 million in the same period of 2023, reflecting a decrease of about 24%[112] - Adjusted EBITDA for the three months ended September 30, 2024, was $(3.5) million, compared to $(0.9) million for the same period in 2023, indicating a worsening of performance[114] - GAAP gross profit for the three months ended September 30, 2024, was $6.2 million, compared to a loss of $20.3 million in the same period of 2023, reflecting a significant improvement[134] - Gross profit (loss) for the nine months ended September 30, 2024, was $(8.6) million, compared to $(7.4) million for the same period in 2023, reflecting a 16% increase in loss[147] Cash and Liquidity - As of September 30, 2024, the company had cash and cash equivalents of $75.4 million, down from $89.6 million as of June 30, 2024, and $105.4 million as of December 31, 2023[96] - As of September 30, 2024, cash and cash equivalents were $75.4 million, with net accounts receivable of $92.7 million[161] - The total financing obligation as of September 30, 2024, was $59.7 million, with $15.0 million classified as a current liability[163] - The company reported a net cash inflow of $72.5 million from changes in operating assets and liabilities for the nine months ended September 30, 2024[170] Revenue Trends and Constraints - Seasonal trends have historically led to most revenue being recognized in the third and fourth quarters, with these periods accounting for 65% of total revenue in the fiscal year ended December 31, 2023[102] - The company recorded a revenue constraint of $10.2 million in the nine months ended September 30, 2023, impacting overall revenue recognition[110] - The total dollar amount of indexed contracts related to lithium carbonate was approximately $52.0 million, with revenue recorded in Q1 2023 of approximately $42.0 million, net of a $10.2 million revenue constraint[110] - The company expects to receive final consideration of at least approximately $34.0 million from indexed contracts in the future[110] Operating Expenses - Total operating expenses increased by $102.7 million, or 214%, for the three months ended September 30, 2024, compared to the same period in 2023, driven by a significant impairment charge[134] - Operating expenses increased by $645.3 million, or 466%, for the nine months ended September 30, 2024, compared to the same period in 2023[147] - General and administrative expense increased by $5.3 million, or 24%, for the three months ended September 30, 2024, primarily due to a one-time contract cancellation payment of $10.0 million[140] - Research and development expenses decreased by $3.3 million, or 23%, for the three months ended September 30, 2024, compared to the same period in 2023[138] Market and Regulatory Environment - The company is assessing the impact of the U.S. Inflation Reduction Act of 2022 on its business and customer incentives, which may affect future revenue and cost structures[105] - The company faces increased competition from existing and new market entrants, which may adversely affect its market share and revenue generation capabilities[107] - Government regulations, including the IRA, significantly influence the pricing and deployment of the company's products and services, impacting overall business operations[108] Compliance and Notices - The company received a notice from the NYSE on August 28, 2024, for non-compliance with listing standards due to the average closing price of its shares falling below $1.00[98] Future Plans and Financing - Future expansion plans may include geographical expansion and joint ventures, but these are not required to achieve current business objectives[161] - The company issued $460.0 million aggregate principal amount of 2028 Convertible Notes, with net proceeds of approximately $445.7 million after expenses[164] - The company used approximately $99.8 million of the net proceeds from the 2030 Convertible Notes to purchase and cancel approximately $163.0 million of the 2028 Convertible Notes[167] - The 2030 Convertible Notes bear an interest rate of 4.25% per year, maturing on April 1, 2030[165] Backlog and Bookings - Bookings for the three months ended September 30, 2024, were $29.1 million, compared to $78.3 million in the same period of 2023[134] - Contracted backlog as of September 30, 2024, was $1,547.4 million, compared to $1,836.6 million as of September 30, 2023[134]