American Superconductor (US:AMSC)2025-11-05 21:13Revenue Performance - Total revenues increased 21% to $65.9 million for the three months ended September 30, 2025, and increased 46% to $138.2 million for the six months ended September 30, 2025, compared to $54.5 million and $94.8 million for the same periods in 2024[126]. - The Grid business segment accounted for 83% of total revenues for both the three and six months ended September 30, 2025, down from 86% and 84% in the same periods of 2024[126]. - Grid business segment revenues increased 16% to $54.3 million for the three months ended September 30, 2025, and increased 44% to $114.4 million for the six months ended September 30, 2025, compared to $46.9 million and $79.3 million in 2024[126]. - Wind business segment revenues increased 53% to $11.5 million for the three months ended September 30, 2025, and increased 53% to $23.8 million for the six months ended September 30, 2025, compared to $7.5 million and $15.5 million in 2024[126]. - The Wind business segment accounted for 17% of total revenues for both the three and six months ended September 30, 2025, up from 14% and 16% in the same periods of 2024, with revenues increasing 53% to $11.5 million for the three months and 54% to $23.8 million for the six months[127]. Cost and Expenses - Cost of revenues increased by 17% to $45.4 million for the three months ended September 30, 2025, and by 39% to $93.3 million for the six months, while gross margin improved to 31% and 33% for the respective periods, compared to 29% in 2024[128]. - Research and development expenses rose 41% to $3.7 million for the three months and 63% to $8.0 million for the six months ended September 30, 2025, driven by higher compensation and stock-based compensation expenses[129]. - Selling, general, and administrative expenses increased 27% to $13.4 million for the three months and 42% to $27.6 million for the six months ended September 30, 2025, primarily due to higher compensation expenses[130]. Profitability - Operating income for the Wind business segment was $1.7 million and $3.2 million for the three and six months ended September 30, 2025, respectively, compared to $0.4 million and $1.3 million in the same periods of 2024[134]. - Net income was $4.8 million and $11.5 million for the three and six months ended September 30, 2025, compared to $4.9 million and $2.4 million in 2024, with the improvement driven by increased revenues and gross margins[140]. - Non-GAAP net income was $8.9 million and $20.4 million for the three and six months ended September 30, 2025, compared to $10.0 million and $13.2 million in 2024, reflecting higher revenues and gross margins[142]. Cash Flow and Liquidity - As of September 30, 2025, the company had cash and cash equivalents of $212.9 million, a significant increase from $79.5 million as of March 31, 2025[147]. - Net cash provided by operating activities was $10.6 million for the six months ended September 30, 2025, down from $16.1 million in the same period of 2024[148]. - For the six months ended September 30, 2025, net cash provided by financing activities was $124.8 million, a significant increase from cash used in financing activities of $0.1 million for the same period in 2024, primarily due to an equity raise in June 2025[149]. - The company believes it has sufficient liquidity to fund operations and capital expenditures for the next twelve months, having raised $124.6 million net of offering expenses through an equity raise in June 2025[152]. Acquisitions and Business Segments - On August 1, 2024, the company acquired Megatran, Industries, Inc. for an aggregate consideration of $61.4 million, enhancing its Grid business segment capabilities[123]. - The company operates under two market-facing business segments: Grid and Wind, allowing it to better meet the needs of power generation project developers and electric utilities[119]. - The increase in Grid business segment revenues was driven by the acquisition of NWL, increased shipments of new energy power systems, and additional ship protection systems revenues compared to prior year periods[126]. Risk Factors and Controls - There have been no material changes to the risk factors disclosed in the Annual Report for the fiscal year ended March 31, 2025[167]. - Management concluded that the disclosure controls and procedures were effective at the reasonable assurance level as of September 30, 2025[164]. - There were no changes to internal control over financial reporting during the quarter ended September 30, 2025, that materially affected the internal control[165]. Foreign Currency and Accounting - Foreign currency exchange risk is present, particularly with AMSC Austria, where a 10% fluctuation in the Euro would have an immaterial effect on consolidated financial statements[162]. - Foreign currency gains were $0.3 million for both the three and six months ended September 30, 2025, compared to losses of $0.3 million and $0.5 million for the same periods in 2024[163]. - The company is evaluating the impact of recent accounting pronouncements on its consolidated financial statements, including ASU 2023-09 and ASU 2024-02[154][155]. - The company has not made any stock repurchases during the three months ended September 30, 2025, and no shares were purchased in connection with stock-based compensation plans[168].