ESS Tech(US:GWH)2024-11-13 22:39Financial Performance - Total revenue for Q3 2024 was $359,000, compared to $1,545,000 in Q3 2023, representing a decrease of approximately 76.8% year-over-year[14] - Gross loss for Q3 2024 was $(12,382,000), compared to a gross loss of $(8,638,000) in Q3 2023, indicating a worsening of 43.5%[14] - Net loss for Q3 2024 was $(22,493,000), compared to $(16,618,000) in Q3 2023, which is an increase in loss of 35.5%[14] - The net loss for the nine months ended September 30, 2024, was $62,743,000, compared to a net loss of $61,448,000 for the same period in 2023[20] - For the three months ended September 30, 2024, the net loss attributable to common stockholders was $22.5 million, compared to a net loss of $16.6 million for the same period in 2023, representing a 35.1% increase[67] Operating Expenses - Operating expenses for Q3 2024 totaled $11,300,000, up from $9,496,000 in Q3 2023, reflecting an increase of 19.0%[14] - Research and development expenses increased to $2,684,000 in Q3 2024 from $1,609,000 in Q3 2023, a rise of 66.7%[14] - Sales and marketing expenses rose by 23% to $2.5 million in Q3 2024 from $2.1 million in Q3 2023; for the nine months ended September 30, 2024, expenses increased by 29% to $7.3 million from $5.6 million in the same period last year[89] - General and administrative expenses increased by 4% to $6.1 million in Q3 2024 from $5.8 million in Q3 2023; for the nine months ended September 30, 2024, expenses rose by 5% to $17.8 million from $17.0 million in the same period last year[91] Cash Flow and Liquidity - Cash used in operating activities for the nine months ended September 30, 2024, was $51,743,000, an increase from $38,751,000 in the prior year[20] - The company had cash, cash equivalents, and restricted cash of $14,675,000 at the end of September 30, 2024, down from $39,491,000 at the end of September 30, 2023[22] - As of September 30, 2024, the company had unrestricted cash and cash equivalents of $12.8 million and short-term investments of $42.3 million, totaling $55.1 million in liquid assets[95] - The company incurred net cash used in operating activities of $51.7 million for the nine months ended September 30, 2024, compared to $38.8 million for the same period in 2023[98] Stockholders' Equity - The company reported a total stockholders' equity of $49,201,000 as of September 30, 2024, down from $103,357,000 at the end of 2023, a decrease of 52.3%[12] - As of September 30, 2023, ESS Tech, Inc. reported total stockholders' equity of $116,460,000, a decrease from $136,974,000 as of December 31, 2022[17] - As of March 31, 2024, the total stockholders' equity was $87,820,000, reflecting a decrease from $116,460,000 as of September 30, 2023[17] Inventory and Assets - The company's inventory as of September 30, 2024, was $7.0 million, reflecting a write-down of $16.3 million from its cost to net realizable value[29] - Total property and equipment, net, increased to $19.9 million as of September 30, 2024, up from $16.3 million as of December 31, 2023[31] - The total assets measured at fair value as of September 30, 2024, amounted to $54.830 million[54] Commitments and Agreements - The Company entered into a Joint Development Agreement with UOP, agreeing to reimburse a minimum of $8.0 million for R&D expenses through December 31, 2028[40] - The company is evaluating various strategies to obtain additional funding, which may include equity offerings or debt issuance[24] - The company is committed to reimburse UOP a minimum of $8.0 million for research and development expenses incurred through December 31, 2028 under the JDA[102] Future Outlook - Revenue is anticipated to be generated from Energy Centers, second-generation Energy Warehouses, and core technology component productization in the near to medium term[74] - The Inflation Reduction Act of 2022 is expected to positively impact the company's gross margins due to extended investment tax credits and production tax credits for energy storage products[76] - The company expects an increase in operating expenses as it ramps up manufacturing and sales activities, with indirect costs projected to rise compared to 2023[73] Research and Development - The company continues to perform research and development activities to expand its product roadmap despite a decrease in related expenses following the transition to commercial inventory accounting[79] - The company transitioned out of the research and development phase into commercial inventory accounting as of July 1, 2023[25]