Energy Vault(NRGV) - 2025 Q2 - Quarterly Report

Cautionary Note Regarding Forward-Looking Statements This section highlights that the Quarterly Report on Form 10-Q contains forward-looking statements, which are subject to known and unknown risks, uncertainties, and other important factors that could cause actual results to differ materially - The report contains forward-looking statements regarding future results, business strategy, and the ability to meet NYSE listing requirements, which are subject to known and unknown risks and uncertainties[11] - Key areas of forward-looking statements include changes in strategy, expansion plans, customer opportunities, financial position, costs, market acceptance of business model, brand development, industry developments, macroeconomic uncertainty, tax law changes (e.g., OBBBA, IRA), investment in development projects, supply chain diversification, intellectual property, future capital requirements, international operations, and the expectation of revenue generation from first two-owned projects in 2025[13] - Investors should not rely on forward-looking statements as predictions of future events, as actual results may differ materially due to various factors, including those detailed in the 'Risk Factors' section of the 2024 Annual Report on Form 10-K[12] Part I - Financial Information Item 1. Financial Statements This section presents Energy Vault Holdings, Inc.'s unaudited condensed consolidated financial statements for the periods ended June 30, 2025, and December 31, 2024, including balance sheets, statements of operations and comprehensive loss, statements of stockholders' equity, and statements of cash flows, along with detailed notes explaining significant accounting policies, revenue recognition, credit losses, debt, equity, and other financial details Condensed Consolidated Balance Sheets The condensed consolidated balance sheets show a significant increase in total assets and liabilities from December 31, 2024, to June 30, 2025, primarily driven by increases in restricted cash, advances to suppliers, property and equipment, and contract liabilities, while total stockholders' equity decreased Condensed Consolidated Balance Sheet Highlights (Amounts in thousands) | Metric | June 30, 2025 | December 31, 2024 | Change ($) | Change (%) | | :----------------------------------- | :-------------- | :---------------- | :--------- | :--------- | | Assets | | | | | | Cash and cash equivalents | $21,416 | $27,091 | $(5,675) | -20.95% | | Restricted cash, current portion | $32,918 | $990 | $31,928 | 3225.05% | | Total current assets | $94,895 | $68,905 | $25,990 | 37.72% | | Property and equipment, net | $120,875 | $99,493 | $21,382 | 21.49% | | Total Assets | $248,828 | $183,889 | $64,939 | 35.32% | | Liabilities | | | | | | Accounts payable | $35,834 | $20,250 | $15,584 | 76.96% | | Long-term debt, current portion | $23,107 | $— | $23,107 | N/A | | Contract liabilities | $65,726 | $8,938 | $56,788 | 635.30% | | Total current liabilities | $143,826 | $54,655 | $89,171 | 163.15% | | Total liabilities | $158,529 | $57,633 | $100,896 | 175.06% | | Stockholders' Equity | | | | | | Total stockholders' equity | $90,299 | $126,256 | $(35,957) | -28.48% | | Total Liabilities and Stockholders' Equity | $248,828 | $183,889 | $64,939 | 35.32% | Condensed Consolidated Statements of Operations and Comprehensive Loss The company reported increased revenue and gross profit for both the three and six months ended June 30, 2025, compared to the prior year. However, net loss also widened due to higher operating expenses, particularly general and administrative costs and provision for credit losses, as well as significantly increased interest expense Condensed Consolidated Statements of Operations Highlights (Amounts in thousands, except per share data) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change ($) | YoY Change (%) | | :----------------------------------- | :--------------------------- | :--------------------------- | :------------- | :------------- | | Revenue | $8,512 | $3,770 | $4,742 | 125.78% | | Cost of revenue | $5,996 | $2,721 | $3,275 | 120.36% | | Gross profit | $2,516 | $1,049 | $1,467 | 139.85% | | Total operating expenses | $30,664 | $28,934 | $1,730 | 5.98% | | Loss from operations | $(28,148) | $(27,885) | $(263) | 0.94% | | Interest expense | $(2,516) | $(38) | $(2,478) | 6521.05% | | Net loss attributable to Energy Vault Holdings, Inc. | $(34,927) | $(26,188) | $(8,739) | 33.37% | | Net loss per share (basic and diluted) | $(0.22) | $(0.18) | $(0.04) | 22.22% | | Metric | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change ($) | YoY Change (%) | | :----------------------------------- | :--------------------------- | :--------------------------- | :------------- | :------------- | | Revenue | $17,046 | $11,529 | $5,517 | 47.85% | | Cost of revenue | $9,654 | $8,412 | $1,242 | 14.76% | | Gross profit | $7,392 | $3,117 | $4,275 | 137.16% | | Total operating expenses | $56,433 | $55,629 | $804 | 1.45% | | Loss from operations | $(49,041) | $(52,512) | $3,471 | -6.61% | | Interest expense | $(2,611) | $(46) | $(2,565) | 5576.09% | | Net loss attributable to Energy Vault Holdings, Inc. | $(56,063) | $(47,327) | $(8,736) | 18.46% | | Net loss per share (basic and diluted) | $(0.36) | $(0.32) | $(0.04) | 12.50% | Condensed Consolidated Statements of Stockholders' Equity The statements of stockholders' equity show a decrease in total equity from December 31, 2024, to June 30, 2025, primarily due to the net loss incurred during the period, partially offset by increases in additional paid-in capital from stock-based compensation and equity purchase agreements Condensed Consolidated Statements of Stockholders' Equity Highlights (Amounts in thousands) | Metric | June 30, 2025 | December 31, 2024 | Change ($) | Change (%) | | :----------------------------------- | :-------------- | :---------------- | :--------- | :--------- | | Common Stock (Shares) | 160,689 | 153,206 | 7,483 | 4.88% | | Common Stock (Amount) | $16 | $15 | $1 | 6.67% | | Additional Paid-In Capital | $532,095 | $512,022 | $20,073 | 3.92% | | Accumulated Deficit | $(439,885) | $(383,822) | $(56,063) | 14.61% | | Total Stockholders' Equity | $90,299 | $126,256 | $(35,957) | -28.48% | - For the six months ended June 30, 2025, additional paid-in capital increased by $18.26 million from stock-based compensation and $1.866 million from shares issued per equity purchase agreement[24] - The accumulated deficit increased by $56.063 million for the six months ended June 30, 2025, reflecting the net loss for the period[24] Condensed Consolidated Statements of Cash Flows The company experienced a significant shift in cash flow from operating activities, moving from a net use of cash in 2024 to a net provision of cash in 2025. This was largely offset by continued cash usage in investing activities and a substantial increase in cash provided by financing activities, primarily from new debt issuances Condensed Consolidated Statements of Cash Flows Highlights (Amounts in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change ($) | Change (%) | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------- | :--------- | | Net cash provided by (used in) operating activities | $12,629 | $(11,846) | $24,475 | 206.61% | | Net cash used in investing activities | $(17,336) | $(20,832) | $3,496 | -16.78% | | Net cash provided by financing activities | $32,140 | $360 | $31,780 | 8827.78% | | Net increase (decrease) in cash, cash equivalents, and restricted cash | $28,026 | $(32,604) | $60,630 | -185.96% | | Cash, cash equivalents, and restricted cash – end of period | $58,099 | $112,951 | $(54,852) | -48.56% | - Operating cash flow improved significantly, moving from a net use of $11.8 million in H1 2024 to a net provision of $12.6 million in H1 2025, driven by increased contract liabilities (advance customer payments) and decreased accounts payable[296][297][298] - Financing activities provided $32.1 million in H1 2025, a substantial increase from $0.4 million in H1 2024, primarily due to $63.8 million from debt financings and $1.2 million from stock issuance, partially offset by debt repayments and issuance costs[301][302][303] Notes to Condensed Consolidated Financial Statements These notes provide detailed explanations and breakdowns of the figures presented in the condensed consolidated financial statements, covering the company's business, significant accounting policies, revenue recognition, credit loss allowances, fair value measurements, related party transactions, investments, property and equipment, intangible assets, debt, pension, stockholders' equity, stock-based compensation, reorganization expenses, segment reporting, income taxes, net loss per share, commitments and contingencies, and subsequent events NOTE 1. Organization and Description of Business Energy Vault Holdings, Inc. provides diverse turnkey energy storage platforms, including gravity, battery, and green hydrogen technologies, supported by its energy management system software. The company is transitioning from a build-and-transfer/licensing model to also taking ownership interests in energy storage assets, aiming to accelerate the global transition to renewable energy by providing clean, reliable, and affordable solutions - Energy Vault offers a diverse technology portfolio of turnkey energy storage platforms, including proprietary gravity, battery, and green hydrogen hardware, integrated with technology-agnostic energy management system software[32] - The company began a multi-year transition in 2024 to shift from solely providing technology to third parties (build-and-transfer or licensing) to also taking an ownership interest in energy storage assets in select markets[32] - Energy Vault's mission is to provide energy storage solutions to accelerate the global transition to renewable energy, addressing the increasing demand for electricity and the intermittency of renewable sources like solar and wind[33] NOTE 2. Summary of Significant Accounting Policies This note outlines the company's accounting practices, including the accrual basis of accounting under GAAP, principles of consolidation, treatment of non-controlling interests, and its election as an emerging growth company. It also details policies for restricted cash, revenue recognition for tolling agreements, and the deferral method for Investment Tax Credits (ITCs), while also discussing recent accounting standards not yet adopted - The financial statements are prepared on an accrual basis in accordance with GAAP and SEC rules for interim financial reporting, reflecting all necessary adjustments for fair presentation[34][35] - The company has elected not to opt out of the extended transition period for complying with new or revised financial accounting standards as an emerging growth company, which may affect comparability with other public companies[39][41][42] - Restricted cash increased significantly from $2.982 million at December 31, 2024, to $36.683 million at June 30, 2025, primarily due to debt financing requirements and collateral for customer project guarantees[51] Restricted Cash Balances (Amounts in thousands) | Category | June 30, 2025 | December 31, 2024 | | :----------------------------------------------------------------- | :-------------- | :---------------- | | Restricted cash, current portion | $32,918 | $990 | | Restricted cash, long-term portion | $3,765 | $1,992 | | Total restricted cash | $36,683 | $2,982 | | Restricted cash related to debt financing | $22,106 | $— | | Restricted cash related to letters of credit, bank guarantees, and performance and payment bonds | $14,577 | $2,982 | - The company accounts for nonrefundable, transferable Investment Tax Credits (ITCs) using the deferral method, reducing the asset's carrying amount and recording a deferred tax asset upon generation, with the benefit recognized as a reduction to depreciation expense over the asset's useful life[61][62][63] - During the three and six months ended June 30, 2025, the company placed one qualified asset into service, generating $14.0 million in statutory ITCs[64] NOTE 3. Revenue Recognition This note details the company's revenue streams, which include sales of energy storage products, tolling revenue from owned projects, and licensing of software and intellectual property, as well as operation and maintenance services. It also provides a breakdown of contract assets and liabilities, noting a significant increase in contract liabilities due to advance customer payments Revenue by Category (Amounts in thousands) | Revenue Category | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Sale of energy storage products | $7,711 | $2,958 | $12,602 | $10,683 | | Tolling revenue | $390 | $— | $390 | $— | | Operation and maintenance services | $277 | $545 | $553 | $545 | | Software licensing | $120 | $152 | $232 | $186 | | Intellectual property ("IP") licensing | $14 | $115 | $3,269 | $115 | | Total revenue | $8,512 | $3,770 | $17,046 | $11,529 | - As of June 30, 2025, remaining performance obligations totaled $205.1 million, with approximately 88% expected to be recognized as revenue over the next 12 months[70] Contract Balances (Amounts in thousands) | Contract Balance | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :---------------- | | Contract assets, net of allowance for credit losses | $7,727 | $6,798 | | Contract liabilities | $65,726 | $8,938 | - Contract liabilities (deferred revenue) significantly increased to $65.7 million at June 30, 2025, from $8.9 million at December 31, 2024, reflecting advance customer payments for ongoing projects[71][75] NOTE 4. Allowance for Credit Losses The company's allowance for credit losses significantly increased for the six months ended June 30, 2025, primarily due to a substantial provision for credit losses on its customer financing receivable and a convertible note receivable from DG Fuels, which was partially impaired due to the counterparty's financial difficulties Allowance for Credit Losses Activity (Amounts in thousands) | Metric | Six Months Ended June 30, 2025 | | :----------------------------------- | :--------------------------- | | Allowance for credit losses, beginning of period | $32,238 | | Provision (benefit) for credit losses | $3,832 | | Allowance for credit losses, end of period | $36,070 | | Metric | Six Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------- | | Allowance for credit losses, beginning of period | $2,514 | | Provision (benefit) for credit losses | $353 | | Write-offs | $(256) | | Allowance for credit losses, end of period | $2,611 | - The provision for credit losses for the six months ended June 30, 2025, was $3.832 million, a significant increase from $0.353 million in the prior year, primarily driven by increased allowances for customer financing receivable and the DG Fuels convertible note receivable[76][257] - The company recorded a $1.9 million allowance for credit losses on its convertible note receivable from DG Fuels in Q2 2025, concluding it was partially impaired due to DG Fuels experiencing financial difficulties[79][91] - The customer financing receivable was placed on non-accrual status effective December 31, 2024, due to past-due installment payments[78] NOTE 5. Fair Value Measurements This note details the company's fair value measurements, categorizing financial instruments into Level 1, 2, or 3 based on input observability. It specifically highlights warrant liabilities and long-term debt, which are measured using Level 3 unobservable inputs, such as a Black-Scholes model for warrants and a discounted cash flow model for debt - The company categorizes financial assets and liabilities into Level 1 (quoted prices in active markets), Level 2 (observable inputs other than Level 1), and Level 3 (unobservable inputs)[84] - Warrant liabilities and long-term debt are measured using Level 3 inputs; warrant fair value is determined using a Black-Scholes model, and long-term debt fair value is estimated using a discounted cash flow model with the company's incremental borrowing rate[82] NOTE 6. Related Party Transactions The company incurred marketing and sales costs with a related party, a company owned by an immediate family member of an officer, totaling $0.2 million for the three months and $0.5 million for the six months ended June 30, 2025, a decrease from the prior year Related Party Marketing and Sales Costs (Amounts in thousands) | Period | 2025 | 2024 | | :----------------------------------- | :----- | :----- | | Three Months Ended June 30, | $200 | $300 | | Six Months Ended June 30, | $500 | $600 | - As of June 30, 2025, the company had no payables due to this related party, compared to $0.1 million at December 31, 2024[83] NOTE 7. Investments The company's investments include equity securities in KORE Power, Inc., recorded at cost less impairment, and convertible and other notes receivable. A significant allowance for credit losses was recorded against the DG Fuels convertible note due to financial difficulties, while new loans were extended to Stoney Creek BESS Pty Ltd for project development, leading to the company's acquisition of Stoney Creek post-period end Investments (Amounts in thousands) | Investment Type | June 30, 2025 (Current) | June 30, 2025 (Long-Term) | December 31, 2024 (Current) | December 31, 2024 (Long-Term) | | :----------------------------------- | :------------------------ | :------------------------ | :-------------------------- | :-------------------------- | | Investment in equity securities | $— | $3,270 | $— | $3,270 | | Convertible note receivable | $— | $1,418 | $2,622 | $— | | Other note receivable | $837 | $1,603 | $311 | $— | | Total Investments | $837 | $6,291 | $2,933 | $3,270 | - The company holds equity securities in KORE Power, Inc. with a cost basis of $15.0 million and cumulative impairment of $11.7 million as of June 30, 2025[87] - A $1.9 million allowance for credit losses was recorded on the DG Fuels convertible note receivable in Q2 2025 due to DG Fuels' financial difficulties, leading to partial impairment[91] - The company loaned AUD 0.5 million (Tranche 1), provided a bank guarantee of AUD 2.5 million (Tranche 2), loaned an additional AUD 0.5 million (Tranche 3), and AUD 2.9 million (Tranche 4) to Stoney Creek BESS Pty Ltd for project development, with the acquisition of Stoney Creek completed on August 5, 2025[92][93][95][96] NOTE 8. Property and Equipment, Net Property and equipment, net, significantly increased to $120.9 million at June 30, 2025, from $99.5 million at December 31, 2024, primarily due to the Cross Trails BESS being placed into service and reclassified from construction in progress. Construction in progress still includes the Calistoga Resiliency Center hybrid energy storage system (CRC HESS) and the Snyder, Texas microgrid and customer demonstration unit (Snyder CDU) Property and Equipment, Net (Amounts in thousands) | Category | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :---------------- | | Energy storage system | $23,892 | $— | | Construction in progress | $86,825 | $88,669 | | Total property and equipment | $125,531 | $102,844 | | Less: accumulated depreciation and amortization | $(4,656) | $(3,351) | | Property and equipment, net | $120,875 | $99,493 | - The Cross Trails BESS was placed into service during the six months ended June 30, 2025, reclassifying its carrying value from construction in progress to energy storage systems[97] - Depreciation and amortization related to property and equipment was $0.4 million for the six months ended June 30, 2025, compared to $0.6 million for the same period in 2024[98] NOTE 9. Intangible Assets, Net Intangible assets, primarily capitalized software to be sold, increased to $5.7 million at June 30, 2025, from $4.5 million at December 31, 2024. The company amortizes these costs over an estimated useful life of five years, with future amortization expenses projected through 2029 and beyond Intangible Assets, Net (Amounts in thousands) | Category | June 30, 2025 (Net Carrying Amount) | December 31, 2024 (Net Carrying Amount) | | :----------------------------------- | :---------------------------------- | :---------------------------------- | | Capitalized software to be sold | $5,749 | $4,538 | - Amortization expense for intangible assets was $0.4 million for the six months ended June 30, 2025, compared to $0.2 million for the same period in 2024[101] Estimated Future Amortization Expense for Intangible Assets (Amounts in thousands) | Year | Amount | | :----------------------------------- | :----- | | Remainder of 2025 | $435 | | 2026 | $871 | | 2027 | $871 | | 2028 | $871 | | 2029 | $508 | | Thereafter | $39 | | Subtotal | $3,595 | | Software projects in process | $2,154 | | Total | $5,749 | NOTE 10. Debt The company significantly increased its debt in 2025, primarily through the issuance of CRC Senior Notes ($27.8 million) and a Cross Trails Bridge Loan ($10.0 million), leading to a substantial rise in interest expense. The CRC Bridge Loan was refinanced, resulting in a $1.4 million loss on early extinguishment. Post-period, a Cross Trails Senior Note of $17.8 million was also secured Summary of Debt (Amounts in thousands) | Debt Instrument | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :---------------- | | CRC Senior Notes | $27,826 | $— | | Cross Trails Bridge Loan | $10,000 | $— | | Total face value of debt | $37,826 | $— | | Unamortized discount and issuance costs | $(4,475) | $— | | Long-term debt, current portion | $(23,107) | $— | | Long-term debt | $10,244 | $— | Interest Expense Components (Amounts in thousands) | Component | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Contractual interest expense | $1,208 | $35 | $1,226 | $39 | | Amortization of debt issuance costs | $661 | $— | $704 | $— | | Amortization of debt discount | $645 | $— | $676 | $— | | Interest expense on finance leases | $2 | $3 | $5 | $7 | | Total | $2,516 | $38 | $2,611 | $46 | - The CRC Bridge Loan of $27.8 million was obtained on March 31, 2025, and refinanced on April 4, 2025, through the issuance of CRC Senior Notes, resulting in a $1.4 million loss on early debt extinguishment[104][105][107] - CRC Senior Notes of $27.8 million were issued on April 4, 2025, bearing interest at 12.5% (then 9.5%) and secured by CRC assets, with the first principal payment of $12.9 million due August 31, 2025[108][109][110] - A Cross Trails Bridge Loan of $10.0 million was entered into on May 12, 2025, at 24% interest, and was repaid in July 2025. Subsequently, a Cross Trails Senior Note of approximately $17.8 million was secured on July 23, 2025, for the Cross Trails energy storage project[113][114][115] NOTE 11. Pension The company's net periodic pension benefit cost for its defined benefit plan increased to $163 thousand for the six months ended June 30, 2025, compared to $124 thousand in the prior year, primarily driven by higher employer service costs and amortization of net loss, partially offset by expected return on plan assets Net Periodic Pension Benefit Cost (Amounts in thousands) | Component | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Employer service costs | $95 | $73 | $182 | $148 | | Interest cost | $19 | $23 | $36 | $48 | | Expected return on plan assets | $(66) | $(53) | $(125) | $(109) | | Amortization of net prior service credit | $10 | $9 | $19 | $18 | | Amortization of net loss | $27 | $9 | $51 | $19 | | Net periodic benefit cost | $85 | $61 | $163 | $124 | NOTE 12. Supplemental Balance Sheets Detail This note provides a detailed breakdown of various balance sheet accounts, including prepaid and other current assets, other assets, accrued expenses, other current liabilities, and other long-term liabilities, showing changes from December 31, 2024, to June 30, 2025 Supplemental Balance Sheet Details (Amounts in thousands) | Category | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :---------------- | | Prepaid and other current assets: | | | | Prepaid expenses | $5,207 | $3,423 | | Total prepaid and other current assets | $5,742 | $3,702 | | Other assets: | | | | Interest receivable, net | $500 | $850 | | Total other assets | $678 | $1,156 | | Accrued expenses: | | | | Professional fees | $8,086 | $8,373 | | Accrued purchases | $3,132 | $8,165 | | Employee costs | $4,362 | $4,019 | | Insurance premium financings | $1,170 | $724 | | Taxes payable | $1,207 | $2,351 | | Warranty liabilities | $711 | $1,336 | | Total accrued expenses | $18,668 | $24,968 | | Other current liabilities: | | | | Operating leases | $451 | $461 | | Finance leases | $40 | $38 | | Total other current liabilities | $491 | $499 | | Other long-term liabilities: | | | | Operating leases | $1,650 | $785 | | Finance leases | $94 | $81 | | Unearned lease revenue - tolling arrangements | $29 | $— | | Asset retirement obligation | $12 | $11 | | Warrant liabilities | $2 | $2 | | Warranty liabilities | $597 | $55 | | Total other long-term liabilities | $2,384 | $934 | NOTE 13. Stockholders' Equity The company entered into an equity purchase agreement with Hudson Global Ventures, LLC, allowing it to sell up to $25.0 million in common stock, with 1.85 million shares already sold for $1.2 million. The company also received a NYSE notification for non-compliance with the minimum stock price listing requirement and is considering options to regain compliance - On March 31, 2025, the company entered into an equity purchase agreement with Hudson Global Ventures, LLC, granting the right to sell up to $25.0 million of newly issued common stock[131] - As consideration for Hudson's commitment, the company paid a $0.2 million commitment fee and issued 452,000 shares of common stock valued at $0.4 million[133] - During the three and six months ended June 30, 2025, the company sold 1.85 million shares of common stock to Hudson for gross proceeds of $1.2 million[140] - On April 16, 2025, the company received a NYSE notification for non-compliance with the minimum $1.00 average closing price requirement over a 30-trading-day period and has six months to regain compliance[141][143] NOTE 14. Stock-Based Compensation The company operates under the 2022 Equity Incentive Plan, 2022 Inducement Plan, and the newly approved 2025 Inducement Plan, which collectively reserve millions of shares for equity awards. Stock option activity for H1 2025 saw a slight decrease in outstanding options, while RSUs granted under market-based conditions increased, leading to $33.8 million in unrecognized stock-based compensation expense for RSUs - The company has three equity incentive plans: the 2022 Equity Incentive Plan, the 2022 Inducement Plan, and the 2025 Inducement Plan, reserving shares for stock options, SARs, restricted stock, and RSUs[144][146][147] Stock Option Activity (Amounts in thousands, except per share data) | Metric | Number of Options | Weighted Average Exercise Price Per Share | | :----------------------------------- | :---------------- | :---------------------------------------- | | Balance as of December 31, 2024 | 6,429 | $1.62 | | Stock options exercised | (3) | $0.80 | | Balance as of June 30, 2025 | 6,426 | $1.62 | | Options exercisable as of June 30, 2025 | 4,045 | $1.64 | - As of June 30, 2025, total unrecognized stock-based compensation expense related to unvested option awards was $2.5 million, expected to be recognized over approximately 1.4 years[150] Restricted Stock Unit (RSU) Activity (Amounts in thousands, except per share data) | Metric | Number of RSUs | Weighted Average Grant Date Fair Value per Share | | :----------------------------------- | :------------- | :----------------------------------------------- | | Nonvested balance as of December 31, 2024 | 22,325 | $2.83 | | RSUs granted | 8,719 | $0.91 | | RSUs forfeited | (773) | $2.79 | | RSUs vested | (6,072) | $3.31 | | Nonvested balance as of June 30, 2025 | 24,199 | $2.02 | - Unrecognized stock-based compensation expense related to RSUs was $33.8 million as of June 30, 2025, with a weighted-average vesting period of approximately 1.6 years[152] Total Stock-Based Compensation Expense (Amounts in thousands) | Category | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Sales and marketing | $1,039 | $1,782 | $2,084 | $3,497 | | Research and development | $1,368 | $2,059 | $2,736 | $4,286 | | General and administrative | $6,577 | $5,663 | $13,440 | $11,405 | | Total stock-based compensation expense | $8,984 | $9,504 | $18,260 | $19,188 | NOTE 15. Reorganization Expenses The company recognized $1.2 million in reorganization costs for the three and six months ended June 30, 2025, related to personnel reduction costs as part of cost savings measures. This represents a decrease from $1.7 million in the prior year, and no additional charges are currently expected Total Reorganization Expenses (Amounts in thousands) | Category | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Sales and marketing | $32 | $288 | $32 | $288 | | Research and development | $318 | $503 | $318 | $503 | | General and administrative | $812 | $918 | $812 | $918 | | Total reorganization expenses | $1,162 | $1,709 | $1,162 | $1,709 | - The company recognized $1.162 million in reorganization costs for the six months ended June 30, 2025, a decrease from $1.709 million in the prior year, with no additional charges expected[155][156] NOTE 16. Segment Reporting The company operates as a single reportable segment, with its CEO reviewing consolidated operating results and using net loss as the primary profit measure to assess performance and allocate resources. Revenue and significant segment expenses are presented on a consolidated basis - Energy Vault operates as a single operating and reportable segment, with the CEO (CODM) reviewing consolidated results to make operating decisions and allocate resources[47][157] Consolidated Segment Financials (Amounts in thousands) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Revenue | $8,512 | $3,770 | $17,046 | $11,529 | | Cost of revenue | $5,996 | $2,721 | $9,654 | $8,412 | | Gross profit | $2,516 | $1,049 | $7,392 | $3,117 | | Non-personnel operating costs | $7,573 | $8,123 | $14,860 | $16,136 | | Salaries and wages | $8,629 | $8,312 | $17,541 | $17,104 | | Stock-based compensation | $8,984 | $9,504 | $18,260 | $19,188 | | Depreciation and amortization | $473 | $279 | $778 | $574 | | Interest expense | $2,516 | $38 | $2,611 | $46 | | Interest income | $(312) | $(1,746) | $(627) | $(3,572) | | Provision for income taxes | $2,073 | $— | $2,456 | $— | | Other segment items | $7,512 | $2,173 | $7,619 | $414 | | Net loss | $(34,932) | $(26,199) | $(56,106) | $(47,338) | NOTE 17. Income Taxes The company recognized a tax provision of $2.1 million and $2.5 million for the three and six months ended June 30, 2025, respectively, primarily due to a partial valuation allowance against Investment Tax Credits (ITCs) and foreign revenue withholdings. A valuation allowance is recorded against most deferred tax assets due to a history of losses, except for ITCs intended for sale. The company is evaluating the impact of the recently enacted One Big Beautiful Bill Act (OBBBA) on its financial statements Income Tax Provision (Amounts in thousands) | Period | 2025 | 2024 | | :----------------------------------- | :----- | :----- | | Three Months Ended June 30, | $2,073 | $— | | Six Months Ended June 30, | $2,456 | $— | - The tax provision for H1 2025 is primarily due to a partial valuation allowance against generated ITCs and tax withholdings on foreign revenue[161] - A valuation allowance is recorded against substantially all net deferred tax assets, except for ITCs intended for sale, due to the company's history of losses[162] - The company is evaluating the impact of the recently enacted One Big Beautiful Bill Act (OBBBA), which includes changes to U.S. federal income tax laws, including ITCs[163] NOTE 18. Net Loss Per Share of Common Stock The company reported a basic and diluted net loss per share of $(0.22) for the three months and $(0.36) for the six months ended June 30, 2025. Due to net losses, potentially dilutive securities such as private warrants, stock options, and RSUs were excluded from the diluted EPS calculation as their effect would have been anti-dilutive. Contingent Earn-Out Shares also expired on May 12, 2025, without being satisfied Net Loss Per Share Attributable to Energy Vault Holdings, Inc. (Amounts in thousands, except per share amounts) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Net loss attributable to Energy Vault Holdings, Inc. | $(34,927) | $(26,188) | $(56,063) | $(47,327) | | Weighted-average shares outstanding – basic and diluted | 156,911 | 149,143 | 155,326 | 148,081 | | Net loss per share – basic and diluted | $(0.22) | $(0.18) | $(0.36) | $(0.32) | - Due to net losses, common share equivalent securities (private warrants, stock options, RSUs) were excluded from diluted EPS calculations as their effect would have been anti-dilutive[166][167] Anti-Dilutive Common Share Equivalent Securities (Amounts in thousands) | Security Type | 3 and 6 Months Ended June 30, 2025 | 3 and 6 Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------------- | :--------------------------------- | | Private warrants | 5,167 | 5,167 | | Stock options | 6,426 | 6,577 | | RSUs | 24,199 | 23,322 | | Total | 35,792 | 35,066 | - The contingent right for 9.0 million Earn-Out Shares expired on May 12, 2025, as the triggering events were not satisfied[167] NOTE 19. Commitments and Contingencies The company's commitments include operating and finance leases, a deferred pension, warranty liabilities, and $5.0 million in non-cancelable purchase obligations. Warranty liabilities increased to $1.3 million at June 30, 2025. The company also has $14.5 million in outstanding letters of credit, $3.7 million in bank guarantees, and $124.9 million in performance and payment bonds. A Tax Credit Transfer Commitment for approximately $39.9 million in ITCs was entered into on March 28, 2025 - Principal commitments as of June 30, 2025, include obligations under operating leases, finance leases, a deferred pension, warranty liabilities, and $5.0 million in non-cancelable purchase obligations[168] Warranty Liabilities (Amounts in thousands) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Warranty liabilities, balance at beginning of period | $761 | $2,005 | $1,391 | $1,818 | | Accruals for warranties issued | $926 | $— | $926 | $— | | Change in estimates | $(200) | $1,288 | $(200) | $1,531 | | Costs paid or settled | $(179) | $(509) | $(809) | $(565) | | Warranty liabilities, balance at end of period | $1,308 | $2,784 | $1,308 | $2,784 | - As of June 30, 2025, the company had $14.5 million in outstanding letters of credit, $3.7 million in bank guarantees, and $124.9 million in outstanding performance and payment bonds[173][174] - On March 28, 2025, the company entered into a Tax Credit Transfer Commitment to sell approximately $39.9 million (net of fees) in Investment Tax Credits (ITCs) generated by its CRC HESS, Cross Trails BESS, and Snyder CDU projects[176] NOTE 20. Subsequent Events Subsequent to June 30, 2025, the company entered into an equity purchase agreement with Helena Global Investment Opportunities I Ltd. for up to $25.0 million in common stock, and completed the acquisition of Stoney Creek BESS Pty Ltd for approximately AUD 4.0 million ($2.6 million) to expand its BESS project portfolio in Australia - On August 6, 2025, the company entered into an equity purchase agreement with Helena Global Investment Opportunities I Ltd. to sell up to $25.0 million of common stock over a 36-month term, subject to certain conditions and a standstill period[178] - On August 5, 2025, the company completed the acquisition of Stoney Creek BESS Pty Ltd for approximately AUD 4.0 million ($2.6 million), expanding its BESS project portfolio in Australia with rights to a 125 MW / 1,000 MWh BESS in Narrabri, New South Wales[183] - In connection with the Stoney Creek acquisition, the company guaranteed Stoney Creek's payment obligations under a Development Services Agreement with Enervest Utility Pty Ltd, which includes up to AUD 8.8 million ($5.7 million) in potential milestone payments[184] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on Energy Vault's financial condition and results of operations, highlighting the company's business model, key factors affecting performance (such as tariffs and energy storage regulations), recent developments, and key operating metrics. It also offers a detailed comparison of financial results for the three and six months ended June 30, 2025, versus 2024, discusses liquidity and capital resources, and presents non-GAAP financial measures Our Business Energy Vault provides a diverse portfolio of turnkey energy storage platforms, including gravity, battery, and green hydrogen technologies, supported by its energy management system software. The company is transitioning from a third-party build-and-transfer/licensing model to also owning and operating energy storage assets, aiming to accelerate the global transition to renewable energy - Energy Vault offers a diverse technology portfolio of turnkey energy storage platforms, including proprietary gravity, battery, and green hydrogen hardware, supported by its technology-agnostic energy management system software and integration platform[188] - The company began a multi-year transition in 2024 to shift from solely providing technology to third parties (build-and-transfer or licensing) to also taking an ownership interest in energy storage assets in select attractive markets[188] - Energy Vault aims to help utilities, independent power producers, and large industrial energy users reduce costs and maintain power reliability, striving to create a world powered by renewable resources[189] Key Factors and Trends Affecting our Business Key factors affecting Energy Vault's business include the significant impact of U.S. tariffs on Chinese lithium-ion batteries, which have caused project delays and cancellations, despite a temporary suspension. The company is also influenced by evolving U.S. energy storage regulations and legislation, such as the IRA and OBBBA, which provide tax incentives but also introduce new restrictions. The rapid growth of the utility-scale energy storage industry, driven by increasing electricity demand and renewable energy deployment, presents opportunities, but competition, inflation, and government regulations pose ongoing risks - U.S. tariffs on Chinese lithium-ion batteries, including a 20% IEEPA tariff and an additional 125% reciprocal tariff (totaling ~155.9% with existing tariffs), materially affected operations, causing delays or cancellations in third-party sales projects[191] - A temporary 90-day pause in certain reciprocal tariffs, effective May 14, 2025, temporarily lowered the cumulative tariff rate, but its continuation beyond mid-August 2025 is uncertain, creating significant supply chain and pricing model risks[192] - The Inflation Reduction Act (IRA) supports energy storage with tax incentives, while the One Big Beautiful Bill Act (OBBBA), enacted in July 2025, introduces changes to ITCs and broadens Prohibited Foreign Entity (PFE) restrictions, potentially dampening demand for battery energy storage systems[197][198][199] - The utility-scale energy storage industry is rapidly growing due to increased electricity demand (e.g., data centers, AI, EVs) and the global transition to renewable energy, with Australia's AEMO forecasting an 80% increase in electricity consumption and 1,500% increase in energy storage capacity by 2050[202][203] - The company faces risks from increased competition, potential declines in renewable energy deployment rates due to inflation, supply chain disruptions, and geopolitical conflicts, as well as changes in federal, state, and local government regulations concerning electricity[208][209][210] Recent Developments Recent developments include the company's acquisition of Stoney Creek BESS Pty Ltd for AUD 4.0 million to expand its Australian BESS project portfolio, a licensing and royalty agreement in India to accelerate B-Vault BESS deployment, and a NYSE notification for non-compliance with the minimum stock price listing requirement. Additionally, the Cross Trails BESS began commercial operations on May 31, 2025, marking the first fully executed asset under the company's 'Own and Operate' strategy - The company acquired Stoney Creek BESS Pty Ltd for approximately AUD 4.0 million ($2.6 million) on August 5, 2025, to expand its BESS project portfolio in Australia, gaining rights to a 125 MW / 1,000 MWh BESS in Narrabri, New South Wales[212][213] - On March 31, 2025, the company entered into a license and royalty agreement with an Indian infrastructure development company to accelerate the manufacturing and deployment of Energy Vault's B-Vault BESS technology and VaultOS EMS software in the Indian market[214] - On April 16, 2025, the company received a NYSE notification for non-compliance with the minimum $1.00 average closing price requirement over a 30-trading-day period and intends to consider alternatives to cure the deficiency[215] - On May 31, 2025, the Cross Trails BESS (57 MW two-hour BESS) began commercial operations, representing the first fully executed asset under the company's 'Own and Operate' growth strategy, supported by a 10-year tolling agreement with Gridmatic[216] Key Operating Metrics The company's key operating metrics show a significant increase in net bookings for the six months ended June 30, 2025, driven by new contracts, and a substantial growth in backlog. The developed pipeline also expanded, indicating potential future revenue, though its realization is subject to various market and project-specific factors Key Operating Metrics (Amounts in thousands, except MWh) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | New bookings ($) | $25,944 | $182,830 | $251,673 | $182,830 | | Cancellations ($) | $— | $(182,238) | $— | $(182,238) | | Net bookings ($) | $25,944 | $592 | $251,673 | $592 | | New bookings (MWh) | 15 | 400 | 1,019 | 400 | | Cancellations (MWh) | — | (400) | — | (400) | | Net bookings (MWh) | 15 | — | 1,019 | — | | Metric | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :---------------- | | Developed Pipeline ($) | $2,353,214 | $2,085,908 | | Developed Pipeline (MWh) | 5,968 | 9,194 | | Backlog ($) | $682,248 | $433,886 | | Backlog (MWh) | 2,392 | 1,574 | - Net bookings for the six months ended June 30, 2025, significantly increased to $251.7 million (1,019 MWh) from $0.6 million (0 MWh) in the prior year, indicating strong new contract acquisition[217] - Backlog increased to $682.2 million (2,392 MWh) at June 30, 2025, from $433.9 million (1,574 MWh) at December 31, 2024, representing contracted but unrecognized revenue[217] - Developed pipeline, representing uncontracted potential revenue, grew to $2.35 billion (5,968 MWh) at June 30, 2025, from $2.09 billion (9,194 MWh) at December 31, 2024, though MWh decreased[217] Key Components of Results of Operations This section defines the key components of the company's results of operations, including revenue sources (product sales, tolling, software/IP licensing, O&M services), cost of revenue, gross profit, and various operating expenses (S&M, R&D, G&A, provision for credit losses, depreciation/amortization). It also covers interest income/expense and other income/expense, explaining how each is recognized and the factors influencing their fluctuations - Revenue is generated from the sale of energy storage products (EPC and EEQ models), tolling arrangements for owned projects, and licensing of software solutions and intellectual property, as well as long-term service agreements[223][224][225][226] - Cost of revenue primarily includes product costs, materials, subcontractors, direct labor, and product warranties, influenced by equipment and material costs (e.g., batteries, inverters, steel) and tariffs[229][230] - Gross profit and gross profit margin can vary due to the timing of transferring control of uninstalled equipment in EPC projects, sales volume, product prices, product mix, geographical mix, and changes in warranty liability estimates[231][232] - Operating expenses include Sales and Marketing (personnel, professional fees, promotional materials), Research and Development (product development, testing, personnel), General and Administrative (IT, legal, corporate personnel), Provision for Credit Losses (potential losses on receivables), and Depreciation and Amortization (property, equipment, intangibles)[233][234][235][236][237] - Interest expense covers contractual interest and amortization of non-cash debt/financing costs, while interest income is derived from money market funds, savings accounts, and receivables. Other income (expense) includes foreign currency gains/losses and non-recurring items[238][239][240] Results of Operations (Detailed Comparison) Energy Vault experienced significant revenue growth for both the three and six months ended June 30, 2025, driven by increased energy storage product sales and IP licensing. Gross profit margins improved, but net loss widened due to higher general and administrative expenses, a substantial increase in provision for credit losses, and significantly higher interest expense from new debt financings. Sales and marketing, and research and development expenses decreased due to cost-control measures Consolidated Results of Operations (Amounts in thousands) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | $ Change | % Change | | :----------------------------------- | :--------------------------- | :--------------------------- | :------- | :------- | | Revenue | $8,512 | $3,770 | $4,742 | 125.8% | | Cost of revenue | $5,996 | $2,721 | $3,275 | 120.4% | | Gross profit | $2,516 | $1,049 | $1,467 | 139.8% | | Sales and marketing | $3,161 | $4,861 | $(1,700) | -35.0% | | Research and development | $4,074 | $6,951 | $(2,877) | -41.4% | | General and administrative | $19,113 | $15,836 | $3,277 | 20.7% | | Provision for credit losses | $3,843 | $442 | $3,401 | 769.5% | | Interest expense | $(2,516) | $(38) | $(2,478) | 6521.1% | | Interest income | $312 | $1,746 | $(1,434) | -82.1% | | Other income (expense), net | $(2,507) | $(22) | $(2,485) | 11295.5% | | Loss before income taxes | $(32,859) | $(26,199) | $(6,660) | 25.4% | | Metric | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | $ Change | % Change | | :----------------------------------- | :--------------------------- | :--------------------------- | :------- | :------- | | Revenue | $17,046 | $11,529 | $5,517 | 47.9% | | Cost of revenue | $9,654 | $8,412 | $1,242 | 14.8% | | Gross profit | $7,392 | $3,117 | $4,275 | 137.1% | | Sales and marketing | $7,306 | $9,031 | $(1,725) | -19.1% | | Research and development | $7,898 | $13,917 | $(6,019) | -43.2% | | General and administrative | $36,619 | $31,189 | $5,430 | 17.4% | | Provision for credit losses | $3,832 | $353 | $3,479 | 985.5% | | Interest expense | $(2,611) | $(46) | $(2,565) | 5576.1% | | Interest income | $627 | $3,572 | $(2,945) | -82.4% | | Other income (expense), net | $(2,625) | $1,648 | $(4,273) | -259.3% | | Loss before income taxes | $(53,650) | $(47,338) | $(6,312) | 13.3% | - Revenue increased by $4.7 million (125.8%) for Q2 2025 and $5.5 million (47.9%) for H1 2025, driven by energy storage product sales (including $2.6 million from nonrefundable deposits on a cancelled EEQ contract) and IP licensing revenue[242][243] - Gross profit margin improved to 29.6% for Q2 2025 (from 27.8%) and 43.4% for H1 2025 (from 27.0%), primarily due to higher margin IP licensing revenue and reduced warranty expenses[247][248] - Sales and marketing expenses decreased by $1.7 million for both Q2 and H1 2025, and R&D expenses decreased by $2.9 million for Q2 and $6.0 million for H1 2025, reflecting cost-control measures and lower headcount[249][250][252][253] - General and administrative expenses increased by $3.3 million for Q2 2025 and $5.4 million for H1 2025, mainly due to expanded G&A headcount and higher legal/professional fees[254][255] - Provision for credit losses increased significantly by $3.4 million for Q2 2025 and $3.5 million for H1 2025, primarily due to increased allowances for customer financing receivable and the DG Fuels convertible note[256][257] - Interest expense surged by $2.5 million for Q2 2025 and $2.6 million for H1 2025, reflecting interest on new debt financings obtained in 2025[260][261] - Other expense, net, was $2.5 million for Q2 2025 and $2.6 million for H1 2025, primarily due to a $1.4 million loss on debt extinguishment and $0.9 million in commitment/transaction fees related to the Hudson Equity Purchase Agreement[263][264] Liquidity and Capital Resources Energy Vault's liquidity is supported by its sales backlog, developed pipeline, and recent debt and equity financings, including the CRC Senior Notes and Cross Trails Bridge Loan. The company aims to raise additional capital through equity/debt, including project-specific preferred equity, and has entered into equity purchase agreements with Hudson and Helena. Cash, cash equivalents, and restricted cash increased significantly to $58.1 million at June 30, 2025, primarily due to debt proceeds, and management believes current liquidity is sufficient for the next twelve months - Energy Vault's liquidity is primarily financed through equity issuance, proceeds from reverse recapitalization, and debt financings, with a sales backlog of $682.2 million and a robust developed pipeline expected to contribute to future funding[265][266] - The company may raise additional capital through equity and/or debt financings, including project-specific preferred equity that is expected to be non-dilutive to common stockholders[268][269] - A Tax Credit Transfer Commitment was entered into on March 28, 2025, to sell approximately $39.9 million in ITCs generated by the CRC HESS, Cross Trails BESS, and Snyder CDU projects[272][273] - The company has an 'at-the-market' equity offering program for up to $50.0 million and entered into equity purchase agreements with Hudson Global Ventures, LLC (up to $25.0 million, $1.2 million already received) and Helena Global Investment Opportunities I Ltd. (up to $25.0 million)[274][275][277][278] - New debt financings include $27.8 million CRC Senior Notes (refinancing a bridge loan) and a $10.0 million Cross Trails Bridge Loan (repaid in July 2025), followed by a $17.8 million Cross Trails Senior Note[279][280][281][286][287][288] Cash, Cash Equivalents, and Restricted Cash (Amounts in thousands) | Category | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :---------------- | | Cash and cash equivalents | $21,416 | $27,091 | | Restricted cash | $36,683 | $2,982 | | Total cash, cash equivalents, and restricted cash | $58,099 | $30,073 | - Management believes current cash, cash equivalents, and restricted cash are sufficient to fund operating activities for at least the next twelve months[270] Debt Maturity Schedule (Amounts in thousands) | Debt Instrument | 2025 | 2026 | 2027 | 2028 | 2029 | Thereafter | Total | | :----------------------------------- | :----- | :----- | :----- | :----- | :----- | :--------- | :------ | | CRC Senior Notes | $12,905 | $669 | $917 | $1,074 | $1,261 | $11,000 | $27,826 | | Cross Trails Bridge Loan | $10,000 | $— | $— | $— | $— | $— | $10,000 | | Total Debt Obligations | $22,905 | $669 | $917 | $1,074 | $1,261 | $11,000 | $37,826 | Non-GAAP Financial Measures This section presents non-GAAP financial measures, including adjusted S&M, R&D, G&A, operating expenses, adjusted net loss, and adjusted EBITDA, which management uses to evaluate ongoing operations. These measures exclude items like stock-based compensation, reorganization expenses, provision for credit losses, and debt extinguishment losses, providing a supplemental view of performance, though they are not a substitute for GAAP measures - The company uses non-GAAP financial measures (adjusted S&M, R&D, G&A, operating expenses, adjusted net loss, and adjusted EBITDA) to complement GAAP amounts and evaluate ongoing results of operations[304] - Adjustments to GAAP measures typically exclude stock-based compensation, reorganization expenses, provision for credit losses, loss on debt extinguishment, equity purchase agreement expenses, foreign exchange losses, loss on impairment/sale of long-lived assets, and gain on derecognition of contract liability[306][307] Adjusted EBITDA Reconciliation (Amounts in thousands) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Net loss attributable to Energy Vault Holdings, Inc. (GAAP) | $(34,927) | $(26,188) | $(56,063) | $(47,327) | | Non-GAAP adjustments (total) | $21,202 | $12,894 | $28,768 | $17,446 | | Adjusted EBITDA (non-GAAP) | $(13,654) | $(15,351) | $(24,924) | $(29,857) | - Adjusted EBITDA improved from $(15.351) million in Q2 2024 to $(13.654) million in Q2 2025, and from $(29.857) million in H1 2024 to $(24.924) million in H1 2025, indicating a reduced adjusted loss[307] - Adjusted EBITDA has limitations as an analytical tool, as it does not reflect cash expenditures, working capital needs, stock-based compensation, or cash requirements for asset replacements, and should not be considered in isolation from GAAP results[308][309] Critical Accounting Estimates The preparation of financial statements requires management to make estimates and assumptions that affect reported amounts. There have been no changes to the company's critical accounting policies and estimates as compared to those disclosed in the 2024 Annual Report on Form 10-K - The preparation of financial statements requires management to make estimates and assumptions that affect reported amounts, and actual results could differ from these estimates[311] - There have been no changes to the company's critical accounting policies and estimates compared to those disclosed in the 2024 Annual Report on Form 10-K[312] Emerging Growth Company Accounting Election As an "emerging growth company," Energy Vault has irrevocably elected to take advantage of the extended transition period for new or revised financial accounting standards, a status expected to continue through the end of 2026. This election may make it difficult to compare its financial results wi