Ocean Power Technologies(US:OPTT)2025-09-15 20:16Financial Performance - The company incurred a net loss of approximately $7.4 million and used cash in operations of approximately $5.6 million during the three months ended July 31, 2025[134]. - Revenues for the three months ended July 31, 2025, were approximately $1.2 million, a decrease of 9.2% compared to $1.3 million in the same period of 2024[157]. - The net loss for the three months ended July 31, 2025, was $7.4 million, compared to a net loss of $4.5 million in the same period of 2024[161]. - Operating expenses rose to $7.1 million in Q3 2025 from $4.9 million in Q3 2024, reflecting a $2.2 million increase mainly from stock-based compensation[159]. - Cost of revenues increased to $1.2 million in Q3 2025 from $0.9 million in Q3 2024, primarily due to a higher proportion of lower-margin third-party equipment[158]. Cash Flow and Liquidity - Net cash used in operating activities was $5.6 million for the three months ended July 31, 2025, a decrease of $0.5 million from $6.1 million in Q3 2024[162]. - Net cash used in investing activities increased to $1.5 million in Q3 2025 from $0.4 million in Q3 2024, primarily due to property, plant, and equipment purchases[163]. - Net cash provided by financing activities was $10.2 million in Q3 2025, up from $6.5 million in Q3 2024, driven by proceeds from convertible notes[164]. - As of July 31, 2025, the company had cash and cash equivalents of $10.0 million, expected to fund operations through September 2026[168]. - The company believes that cash on hand and forecasted operating results will provide sufficient liquidity to meet obligations for at least the next 12 months[135]. Backlog and Revenue Expectations - As of July 31, 2025, the backlog was $15.0 million, compared to $5.3 million at July 31, 2024, indicating a significant increase in unfulfilled purchase orders[139]. - The company expects to convert all current backlog into revenue within the next 12 to 36 months, although the timing is subject to change[139]. Market and Operational Insights - Revenue from North America and South America accounted for 11% of total revenues for the three months ended July 31, 2025, down from 95% in the same period of 2024, while EMEA revenues increased to 89%[146]. - The company operates primarily through a combination of direct sales and leases, strategic partnerships, and long-term service agreements, emphasizing capital-light deployments and recurring revenue[131]. - The company has experienced negative cash flows from operations and net losses since inception, with year-to-date net losses of $7.4 million as of July 31, 2025[167]. Risks and Future Considerations - The company continues to face significant risks and uncertainties that could materially affect future operating results, including product performance and access to capital[134]. - The company does not currently hedge its exchange rate exposure but may consider it in the future based on ongoing assessments[154]. Financing Activities - The company issued $10.0 million in convertible notes in May 2025, receiving net proceeds of $9.7 million, which could result in dilution to existing shareholders[138]. - An At-the-Market Issuance Sales Agreement was entered into on August 8, 2025, allowing the company to raise up to $40.0 million, with approximately $1.1 million raised as of the filing date[136]. Intellectual Property - The company was awarded a new U.S. patent for an autonomous offshore charging solution, enhancing its intellectual property portfolio and positioning it for scalable offshore infrastructure[133].