Core Insights - The article discusses the advancements and market potential of oxide solid-state batteries, highlighting their safety and energy density advantages over traditional liquid batteries [1][2][8] - It emphasizes the expected growth trajectory of the solid-state battery market, with projections indicating a significant increase in global shipments by 2030 [1][8] Industry Overview - Oxide solid-state batteries utilize oxide materials as solid electrolytes, replacing organic electrolytes and separators in traditional lithium-ion batteries, thus enhancing safety and energy density [1][2] - The most promising electrolyte type is the garnet-type LLZO, which exhibits high ionic conductivity and stability [3][4] Market Projections - By 2027, small-scale production of solid-state batteries is anticipated, with global shipments expected to reach 614 GWh by 2030, of which nearly 30% will be solid-state batteries [1][8] - In China, the solid-state battery market is projected to exceed 100 billion yuan by 2030, with oxide electrolytes expected to capture over 70% of the market share by 2025 [10][11] Policy Support - The Chinese government has introduced multiple policies to support the development of the solid-state battery industry, providing a clear framework for technological advancement and commercialization [5][6] Industry Chain Structure - The industry chain for oxide solid-state batteries in China is well-defined, with upstream resources including lithium and zirconium, midstream battery manufacturing, and downstream applications in electric vehicles and energy storage [5][6] Application Areas - The primary application for oxide solid-state batteries is in electric vehicles, where they are expected to enhance safety and energy density, with companies like BYD planning to launch new models featuring these batteries [7][8] - Other applications include consumer electronics and energy storage systems, where the demand for high energy density and safety is increasing [7][8] Competitive Landscape - The competition in the oxide solid-state battery sector is intensifying, with major players like CATL and BYD leading the charge in research and production [12][14] - New entrants are also emerging, leveraging unique technologies to enhance competition and drive industry progress [14][17]

Core Viewpoint - SK On has successfully established a pilot plant for solid-state batteries, aiming to overcome key technologies for the next generation of batteries and accelerate commercialization [1][4]. Group 1: Pilot Plant Establishment - The pilot plant, located in Daejeon, South Korea, covers an area of approximately 4,628 square meters and will primarily produce prototypes for customers while systematically evaluating product quality and performance [1]. - The completion ceremony was attended by key figures including SK On President Lee Seok-hee and Solid Power's Korea branch president Andreas Maier, highlighting the strategic partnership established with Solid Power for joint research and development [1]. Group 2: Commercialization Goals - SK On plans to achieve commercialization of solid-state batteries by 2029, one year earlier than the original target of 2030, with a primary goal of developing batteries with an energy density of 800Wh/L and a long-term target of 1000Wh/L [2]. Group 3: Technological Innovations - The company has applied its self-developed Warm Isostatic Press (WIP) technology in the pilot plant, which enhances electrode density and overall performance while effectively suppressing battery heating and extending cycle life [2]. - SK On has successfully overcome production efficiency limitations associated with traditional WIP applications by optimizing battery material mixing and electrode composition, leading to reduced internal resistance and improved thermal management [2][3]. Group 4: Collaborative Research Efforts - In addition to in-house research, SK On actively collaborates with various partners, including a partnership with Hanyang University that has successfully tripled the lifespan of sulfide-based solid-state batteries through protective film technology for lithium metal anodes [3].

Core Insights - The focus is on identifying high-quality companies with a market capitalization of less than $10 billion that can reinvest capital for significant returns [1] - The ideal companies should have a long-term capability of capital compounding, aiming for a compound annual growth rate that could yield tenfold returns or more [1] - A long-term investment perspective is emphasized to achieve higher returns compared to market indices, especially in a landscape favoring short-term holdings [1] - A conservative investment strategy is primarily adopted, with occasional pursuit of favorable risk-reward opportunities [1] Investment Strategy - The strategy involves maintaining a portfolio that balances stability while allowing for proportional allocation to high-potential ventures [1] - The approach is to focus on companies that demonstrate impressive capital compounding abilities over time [1]

Industry Overview - The price premium for electric vehicles (EVs) over gasoline vehicles has been declining as production scales up in the industry [1] - Electric car sales experienced significant growth last year but have since stagnated and may have declined [1] Analyst Background - The analyst, Harrison, has been writing on Seeking Alpha since 2018 and has over a decade of experience in market analysis [1] - Harrison's professional background includes private equity, real estate, and economic research, complemented by an academic focus on financial econometrics and global monetary economics [1]

Battery - Avesta Holding, a Belgian high-tech company, has signed an agreement to establish a GWh-level solid-state battery project in Jintan, Jiangsu, with an initial investment of €5 million and a planned second phase investment of €100 million, expecting an annual output value of ¥2 billion and tax revenue exceeding ¥100 million upon reaching full production [2] - Great Wall Motors has initiated a recall of 67 electric vehicles due to potential safety hazards related to battery production issues, offering free replacements for the affected battery modules [3] - BMW has commenced road testing of its BMW i7 equipped with large solid-state batteries developed by Solid Power, in collaboration with Umicore, aiming to enhance electric vehicle performance and sustainability [4][5] Materials - Kodali has announced a change in its project location from Malaysia to Thailand, with a new investment of up to ¥210 million, aiming for an annual output value of approximately ¥480 million upon completion [7][8] - Greeenme announced a net profit of ¥799 million for the first half of 2025, with a revenue of ¥17.561 billion, reflecting a year-on-year growth of 1.28% in revenue and 13.91% in net profit [9] Equipment - Winbond Technology has successfully shipped multiple high-performance coating machines to a battery factory in Hungary, supporting a production line with a capacity of 40 GWh, marking a significant achievement in its European strategic layout [12][13] Recycling - Shaanxi Jiaokong and Shenzhen Qiantai have signed a cooperation agreement to expand the recycling and dismantling business of new energy vehicles, focusing on battery disposal and providing expertise in battery storage and utilization [10]

Investment Rating - Overweight (Maintain) [1] Core Viewpoints - The dry electrode process is a new battery manufacturing technology that does not use solvents, simplifying production and reducing costs by over 10% [3][30][37] - Solid-state batteries, leveraging high energy density and safety, are seen as the ultimate solution for next-generation lithium batteries, with dry electrode technology being a key driver for their industrialization [3][30][36] - The dry electrode process can increase battery energy density by approximately 20% and is better suited for the production of solid-state batteries, particularly those using sulfide electrolytes [30][31][36] Summary by Sections 1. Dry Electrode as a New Electrode Manufacturing Process - The dry electrode process differs from the traditional wet process by eliminating solvent use, which reduces energy consumption and production time [16][25] - The dry process faces challenges in achieving uniform mixing and film consistency, impacting yield rates [28][30] 2. Dry Electrode as a Key Technology for Solid-State Battery Industrialization - The dry electrode process is essential for the development of solid-state batteries, particularly those utilizing sulfide electrolytes, which have the highest ionic conductivity [33][36] - The first generation of solid-state batteries is expected to achieve production by 2027, with significant advancements in technology and production lines anticipated in 2025-2026 [42][43] 3. Equipment Demand Driven by Dry Electrode Process - The solid-state battery equipment market is projected to grow significantly, with an estimated market size of approximately 108 billion yuan by 2030, driven by the demand for new and upgraded equipment for the dry electrode process [45][47] - Key companies in the dry electrode equipment sector include leading firms with capabilities in solid-state battery production lines, such as Xian Dao Intelligent and Nacono [3][44]

Investment Rating - The report indicates a positive outlook for the solid-state battery industry, suggesting it as a key upgrade direction for lithium-ion batteries [1]. Core Insights - Solid-state batteries are expected to address the limitations of liquid lithium-ion batteries, such as energy density ceilings, safety risks from lithium dendrites, and performance issues at low temperatures [5][11]. - The global solid-state battery shipment is projected to reach 614.1 GWh by 2030, with a market size potentially reaching 17.2 billion yuan [19][21]. - The penetration rate of solid-state batteries is expected to increase from approximately 0.1% in 2023 to 10% by 2030 [22][24]. Summary by Sections 1. Solid-State Battery as an Upgrade Direction - The solid-state electrolyte enhances battery safety, with technology routes categorized into sulfide, oxide, and polymer types [5][16]. - The development of solid-state batteries is crucial for overcoming existing technological bottlenecks and meeting future diverse application needs [5][11]. 2. Industry Progress and Adoption - Major automotive manufacturers are accelerating the adoption of solid-state batteries, with a focus on sulfide technology [29][33]. - Companies like BYD and CATL have confirmed their commitment to the sulfide solid-state battery route, with production plans in place [33][36]. 3. Cost Reduction Trends - The current cost of solid-state batteries is higher than traditional lithium-ion batteries, with projections indicating that the unit cost could reach 0.78 yuan/Wh in the long term [38][42]. - The cost of solid-state batteries is expected to decrease as production yields improve, with mid-term costs estimated at around 0.50 yuan/Wh [42][43]. 4. Key Companies in the Solid-State Battery Industry - Notable companies involved in the solid-state battery sector include Nakanor, Yuanhang Precision, Better Ray, Lingge Technology, and Wuhan Blue Electric, each making significant advancements in technology and production capabilities [4][4][4]. - Nakanor has delivered key solid-state battery equipment to major clients, marking a technological breakthrough in the industry [4][4]. - Better Ray has launched high-nickel positive electrodes and solid-state electrolytes, contributing to next-generation battery solutions [4][4]. 5. Market Demand and Government Support - The Chinese government has elevated solid-state battery research to a national strategic level, with significant funding and policy support aimed at accelerating development [19][20]. - The solid-state battery market is anticipated to grow significantly, driven by advancements in technology and increasing demand for electric vehicles [19][21].

证券研究报告|行业研究报告 [Table_Date] 2025 年 8 月 8 日 [Table_Title] Solid Power 2025Q2 收入为 750 万美元，净亏损为 2534 万美元 [Table_Title2] 有色金属-海外季报 [Table_Summary] 季报重点内容: ►2025Q2 年财务业绩情况 2025Q2，Solid Power 实现了 750 万美元的收入和补助收 入，而 2025 年第一季度为 600 万美元，使 2025 年上半年 的确认收入达到 1350 万美元。同比增长 8%，环比增长 28%。2025Q2 的收入主要得益于公司与 SK On Co., Ltd. 签订 的线路安装协议中工厂验收测试里程碑的实现。 2025Q2，运营亏损 2,587.1 万美元，环比亏损有所扩大。 2025Q2，净亏损 2,533.8 万美元，同环比亏损有所扩大。 截至 2025 年 6 月 30 日，现金及现金等价物为 2,624.8 万美元。 截至 2025 年 6 月 30 日，总流动性为 2.798 亿美元。 截至 2025 年 6 月 30 日，合同应收款为 460 万美 ...

[FORM 10-Q Filing Information](index=1&type=section&id=FORM%2010-Q) This section provides essential filing details for Solid Power, Inc., including registrant information, securities registered, and filing status [Registrant Information](index=1&type=section&id=Registrant%20Information) This section provides the basic identification details for Solid Power, Inc., including its exact name, state of incorporation, address, telephone number, and securities registered on Nasdaq. It also confirms the company's filing status as a non-accelerated filer and smaller reporting company, and that it is not a shell company - Registrant: **SOLID POWER, INC.**[3](index=3&type=chunk) - State of Incorporation: Delaware[4](index=4&type=chunk) - Principal Executive Offices: 486 S. Pierce Ave., Suite E, Louisville, Colorado 80027[4](index=4&type=chunk) Securities Registered Pursuant to Section 12(b) of the Act | Title of each class | Trading symbol(s) | Name of each exchange on which registered | | :------------------ | :---------------- | :---------------------------------------- | | Common stock, par value $0.0001 per share | SLDP | The Nasdaq Stock Market LLC | | Warrants, each whole warrant exercisable for one share of common stock at an exercise price of $11.50 | SLDPW | The Nasdaq Stock Market LLC | - Filing Status: Non-accelerated filer, Smaller reporting company[6](index=6&type=chunk) - Shares of common stock issued and outstanding as of August 5, 2025: **181,284,380 shares**[6](index=6&type=chunk) [Table of Contents](index=2&type=section&id=Table%20of%20Contents) This section outlines the structure and content of the Form 10-Q report, providing navigation to key financial and operational disclosures [Cautionary Note Regarding Forward-Looking Statements](index=2&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section warns that the report contains forward-looking statements subject to risks and uncertainties, and actual results may differ materially [General Disclosure](index=2&type=section&id=General%20Disclosure) This section highlights that the report contains forward-looking statements subject to risks and uncertainties, and actual results may differ materially. The company disclaims any duty to update these statements, emphasizing that they are based on current expectations and projections - The report contains forward-looking statements regarding future financial performance, strategy, expansion plans, market opportunity, operations, and operating results[9](index=9&type=chunk) - These statements are subject to known and unknown risks, uncertainties, and assumptions that may cause actual results to differ materially[9](index=9&type=chunk) - The Company disclaims any duty to update forward-looking statements, except as required by applicable law[9](index=9&type=chunk) [Specific Risk Factors](index=2&type=section&id=Specific%20Risk%20Factors) Key risks include the uncertainty of R&D success, the company's status as a research and development stage company with a history of losses, the non-exclusive nature of partnerships, and the ability to secure new business relationships and commercial agreements - Risks related to the uncertainty of R&D success, including achieving technological objectives and commercializing technology ahead of competitors[10](index=10&type=chunk) - Risks associated with being a research and development stage company with a history of financial losses and expected future significant expenses[10](index=10&type=chunk) - Risks concerning the non-exclusive nature of partnerships and the ability to secure and manage new business relationships[10](index=10&type=chunk) - Challenges in negotiating and executing commercial agreements with partners and customers on reasonable terms[10](index=10&type=chunk) - Dependence on broad market adoption of EVs and other technologies[16](index=16&type=chunk) - Ability to attract and retain executive officers, key employees, and qualified personnel[16](index=16&type=chunk) - Ability to protect and maintain intellectual property, including internationally[16](index=16&type=chunk) - Ability to secure government contracts and grants, and risks from changes in government priorities or subsidies[16](index=16&type=chunk) - Delays in construction and operation of facilities for R&D and electrolyte production[16](index=16&type=chunk) - Changes in applicable laws or regulations, and risks related to IT infrastructure and data security breaches[16](index=16&type=chunk) - Other economic, business, or competitive factors, including supply chain interruptions and market conditions[16](index=16&type=chunk) [Trademarks](index=3&type=section&id=TRADEMARKS) This section clarifies the ownership and usage of the company's trademarks and references to other entities' trademarks within the report [Trademark Ownership and Usage](index=3&type=section&id=Trademark%20Ownership%20and%20Usage) This section clarifies that the company's logo and trademarks are its property, while references to other entities' trademarks do not imply a relationship or endorsement. The use of symbols like ® or ™ is for convenience and does not waive rights - The Company's logo and trademarks are its property[15](index=15&type=chunk) - References to other companies' trademarks do not imply a relationship with, or endorsement or sponsorship by, those companies[15](index=15&type=chunk) [Market and Industry Data](index=5&type=section&id=MARKET%20AND%20INDUSTRY%20DATA) This section describes the sources and reliability of market and industry data used in the report, acknowledging inherent risks and uncertainties [Data Sources and Reliability](index=5&type=section&id=Data%20Sources%20and%20Reliability) The company uses internal estimates, independent market research, industry publications, and governmental agencies for market and industry data. It acknowledges that such data involves risks and uncertainties and is subject to change - Industry and market data are sourced from internal estimates, independent market research, industry publications, governmental agencies, and third-party studies[18](index=18&type=chunk) - Internal estimates are based on publicly available information, internal research, and industry experience, with assumptions believed to be reasonable[18](index=18&type=chunk) - The data involves material risks and uncertainties and is subject to change, potentially causing results to differ materially from estimates[18](index=18&type=chunk) [Available Information](index=5&type=section&id=AVAILABLE%20INFORMATION) This section details how to access the company's SEC filings and other public disclosures, including its investor relations website and social media [Access to Company Filings and Information](index=5&type=section&id=Access%20to%20Company%20Filings%20and%20Information) The company's SEC filings (10-K, 10-Q, 8-K) are available free of charge on its investor relations website and the SEC's website. The company also uses its website and social media channels to disclose information, which investors should monitor - Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments are filed with the SEC[20](index=20&type=chunk) - These reports are available free of charge at https://www.solidpowerbattery.com/investor-relations/financials/sec-filings and http://www.sec.gov[20](index=20&type=chunk) - The company uses its website (www.solidpowerbattery.com) and social media (e.g., LinkedIn) for disclosing information, which may be deemed material, and investors should monitor these channels[21](index=21&type=chunk) [PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents the company's unaudited condensed consolidated financial statements and management's discussion and analysis of financial condition and results of operations [Item 1. Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including the 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, asset breakdowns, revenue recognition, fair value measurements, and related party transactions for the periods ended June 30, 2025 and 2024 [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Key Balance Sheet Data (in thousands) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 | | :---------------------------------- | :-------------------------- | :------------------ | | Total current assets | $239,672 | $125,236 | | Total long-term assets | $158,323 | $323,014 | | Total assets | $397,995 | $448,250 | | Total current liabilities | $12,399 | $19,970 | | Total long-term liabilities | $14,825 | $17,966 | | Total liabilities | $27,224 | $37,936 | | Total stockholders' equity | $370,631 | $410,280 | - Total assets decreased by **$50.255 million** from December 31, 2024, to June 30, 2025[25](index=25&type=chunk) - Total liabilities decreased by **$10.712 million** over the same period[25](index=25&type=chunk) - Total stockholders' equity decreased by **$39.649 million** from December 31, 2024, to June 30, 2025[25](index=25&type=chunk) [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Key Income Statement Data (in thousands, except per share amounts) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $6,485 | $5,075 | $11,609 | $11,028 | | Grant income | $1,055 | $— | $1,947 | $— | | Total revenue and grant income | $7,540 | $5,075 | $13,556 | $11,028 | | Total operating expenses | $33,411 | $32,012 | $63,455 | $63,746 | | Operating Loss | $(25,871) | $(26,937) | $(49,899) | $(52,718) | | Net Loss Attributable to Common Stockholders | $(25,338) | $(22,274) | $(40,488) | $(43,481) | | Basic and diluted loss per share | $(0.14) | $(0.13) | $(0.22) | $(0.24) | - Total revenue and grant income increased by **$2.465 million (49%)** for the three months ended June 30, 2025, compared to the same period in 2024[26](index=26&type=chunk) - Total revenue and grant income increased by **$2.528 million (23%)** for the six months ended June 30, 2025, compared to the same period in 2024[26](index=26&type=chunk) - Net loss attributable to common stockholders increased by **$3.064 million (14%)** for the three months ended June 30, 2025, compared to the same period in 2024[26](index=26&type=chunk) - Net loss attributable to common stockholders decreased by **$2.993 million (7%)** for the six months ended June 30, 2025, compared to the same period in 2024[26](index=26&type=chunk) [Condensed Consolidated Statement of Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statement%20of%20Stockholders%27%20Equity) Stockholders' Equity Changes (in thousands) | Metric | Balance as of Dec 31, 2024 | Balance as of June 30, 2025 | | :---------------------------------- | :------------------------- | :-------------------------- | | Total Stockholders' Equity | $410,280 | $370,631 | | Net loss (6 months) | $(40,488) | | | Stock-based compensation expense (6 months) | $3,983 | | | Repurchase and retirement of shares of common stock (6 months) | $(3,537) | | - Total stockholders' equity decreased by **$39.649 million** from December 31, 2024, to June 30, 2025[28](index=28&type=chunk) - Net loss for the six months ended June 30, 2025, was **$(40,488) thousand**[28](index=28&type=chunk) - Stock-based compensation expense for the six months ended June 30, 2025, was **$3,983 thousand**[28](index=28&type=chunk) - Repurchase and retirement of common stock resulted in a decrease of **$3,537 thousand** in additional paid-in capital for the six months ended June 30, 2025[28](index=28&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Net cash and cash equivalents used in operating activities | $(40,734) | $(40,179) | | Net cash and cash equivalents provided by investing activities | $45,073 | $44,811 | | Net cash and cash equivalents used in financing activities | $(3,504) | $(8,531) | | Net increase (decrease) in cash and cash equivalents | $835 | $(3,899) | | Cash and cash equivalents at end of period | $26,248 | $30,638 | - Net cash used in operating activities increased slightly by **$0.555 million** in the first six months of 2025 compared to 2024[30](index=30&type=chunk) - Net cash provided by investing activities increased by **$0.262 million** in the first six months of 2025 compared to 2024[30](index=30&type=chunk) - Net cash used in financing activities decreased significantly by **$5.027 million** in the first six months of 2025 compared to 2024, primarily due to reduced stock repurchases[30](index=30&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) [Note 1 – Nature of Business](index=10&type=section&id=Note%201%20%E2%80%93%20Nature%20of%20Business) - Solid Power, Inc. is developing solid-state battery technology for the EV and other markets[31](index=31&type=chunk) - The planned business model is to sell its electrolyte and license its cell designs and manufacturing processes[31](index=31&type=chunk) [Note 2 – Significant Accounting Policies](index=10&type=section&id=Note%202%20%E2%80%93%20Significant%20Accounting%20Policies) - Financial statements are prepared under U.S. GAAP and reflect normal recurring adjustments[33](index=33&type=chunk) - The Company accounts for its equity ownership in Dahae Energy Co., Ltd. using the equity method, as it does not meet control requirements for consolidation[34](index=34&type=chunk) - Effective January 1, 2025, the Company changed its revenue recognition input method for collaborative arrangements from labor hours to the cost-to-cost method, treated as a change in estimate[38](index=38&type=chunk) - Grant income from the U.S. Department of Energy's Assistance Agreement (up to **$50,000** for electrolyte production pilot line) is recognized in accordance with International Accounting Standards 20[41](index=41&type=chunk) - The Company operates in one operating and one reportable segment, with the CEO reviewing consolidated financial information[44](index=44&type=chunk) - New FASB ASUs (2023-09 on Income Taxes and 2024-03 on Expense Disaggregation) are being evaluated for impact, with effective dates in 2025 and 2026/2027 respectively[45](index=45&type=chunk)[46](index=46&type=chunk) [Note 3 – Property, Plant and Equipment, Net](index=14&type=section&id=Note%203%20%E2%80%93%20Property,%20Plant%20and%20Equipment,%20Net) Property, Plant and Equipment, Net (in thousands) | Category | June 30, 2025 | December 31, 2024 | | :-------------------------- | :-------------- | :---------------- | | Production equipment | $43,578 | $41,750 | | Laboratory equipment | $14,073 | $12,611 | | Leasehold improvements | $73,257 | $73,114 | | Furniture and computer equipment | $4,478 | $4,298 | | Construction in progress | $5,485 | $5,141 | | Total cost | $140,871 | $136,914 | | Accumulated depreciation | $(48,829) | $(39,706) | | Property, plant and equipment, net | $92,042 | $97,208 | Depreciation Expense (in thousands) | Period | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Depreciation expense | $4,595 | $4,061 | $9,131 | $7,966 | - Depreciation expense increased by **$0.534 million (13.1%)** for the three months ended June 30, 2025, and by **$1.165 million (14.6%)** for the six months ended June 30, 2025, compared to the prior year periods[48](index=48&type=chunk) - Construction in progress for the continuous electrolyte pilot manufacturing line increased from **$1,194 thousand** at December 31, 2024, to **$3,458 thousand** at June 30, 2025[48](index=48&type=chunk) - The continuous electrolyte production pilot line is expected to be substantially complete and commissioned by the end of 2026[48](index=48&type=chunk) [Note 4 – Intangible Assets](index=15&type=section&id=Note%204%20%E2%80%93%20Intangible%20Assets) Intangible Assets (in thousands) | Category | Gross Carrying Amount (June 30, 2025) | Accumulated Amortization (June 30, 2025) | Gross Carrying Amount (Dec 31, 2024) | Accumulated Amortization (Dec 31, 2024) | | :---------------- | :------------------------------------ | :--------------------------------------- | :----------------------------------- | :-------------------------------------- | | Licenses | $149 | $(74) | $149 | $(69) | | Patents | $225 | $(18) | $135 | $(12) | | Patents pending | $2,385 | $— | $1,831 | $— | | Trademarks | $13 | $— | $13 | $— | | Trademarks pending | $30 | $— | $25 | $— | | Total amortizable intangible assets | $2,802 | $(92) | $2,153 | $(81) | Amortization Expense (in thousands) | Period | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Amortization expense | $3 | $11 | $6 | $7 | - Amortization expenses are recorded within research and development expense[50](index=50&type=chunk) [Note 5 – Revenue and Grant Income](index=16&type=section&id=Note%205%20%E2%80%93%20Revenue%20and%20Grant%20Income) Revenue and Grant Income by Type (in thousands) | Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Government - revenue | $505 | $675 | $1,168 | $1,292 | | Government - grant income | $1,055 | $— | $1,947 | $— | | Non-government revenue | $5,980 | $4,400 | $10,441 | $9,736 | | Total revenue and grant income | $7,540 | $5,075 | $13,556 | $11,028 | - Total revenue and grant income increased by **$2.465 million (49%)** for the three months ended June 30, 2025, compared to the prior year[52](index=52&type=chunk) - Total revenue and grant income increased by **$2.528 million (23%)** for the six months ended June 30, 2025, compared to the prior year[52](index=52&type=chunk) - Grant income, primarily from the DOE Assistance Agreement, contributed **$1.055 million** and **$1.947 million** for the three and six months ended June 30, 2025, respectively (none in prior year periods)[52](index=52&type=chunk) [Note 6 – Fair Value Measurements](index=16&type=section&id=Note%206%20%E2%80%93%20Fair%20Value%20Measurements) Marketable Securities and Investments (in thousands) | Asset Classification | Maturity | June 30, 2025 | December 31, 2024 | | :------------------- | :--------------- | :-------------- | :---------------- | | Commercial Paper | 1 year or less | $44,425 | $47,046 | | Corporate Bonds | 1 year or less | $129,393 | $28,614 | | Government Bonds | 1 year or less | $24,794 | $— | | U.S. Treasuries | 1 year or less | $6,073 | $17,124 | | **Total Marketable securities** | | **$204,685** | **$92,784** | | Corporate Bonds | 1 to 5 years | $33,147 | $173,369 | | Government Bonds | 1 to 5 years | $15,729 | $35,904 | | Equity Method Investment | | $1,834 | $1,127 | | **Total Investments** | | **$50,710** | **$210,400** | - Marketable securities increased by **$111.901 million** from December 31, 2024, to June 30, 2025[55](index=55&type=chunk) - Investments decreased by **$159.690 million** over the same period, primarily due to a shift from long-term corporate and government bonds to short-term marketable securities[55](index=55&type=chunk) - Fair value of Public Warrants (Level 1) was **$0.33 per warrant** at June 30, 2025, up from **$0.17** at March 31, 2025[62](index=62&type=chunk) - Fair value of Private Placement Warrants (Level 2) was **$0.28 per warrant** at June 30, 2025, up from **$0.10** at March 31, 2025[62](index=62&type=chunk) [Note 7 – Warrant Liabilities](index=19&type=section&id=Note%207%20%E2%80%93%20Warrant%20Liabilities) Outstanding Warrants | Warrant Type | June 30, 2025 | December 31, 2024 | | :---------------------- | :-------------- | :---------------- | | Public Warrants | 13,182,501 | 13,182,501 | | Private Placement Warrants | 6,150,802 | 6,150,802 | Fair Value of Warrant Liabilities (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :-------------- | :---------------- | | Fair value of warrant liabilities | $6,072 | $8,735 | Gain (Loss) Recognized from Warrant Liabilities (in thousands) | Period | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Gain (Loss) recognized associated with warrant liabilities | $(3,216) | $703 | $2,663 | $202 | - Warrants are exercisable at **$11.50 per share** and expire on December 8, 2026[64](index=64&type=chunk) [Note 8 – Stockholders' Equity](index=21&type=section&id=Note%208%20%E2%80%93%20Stockholders%27%20Equity) Common Stock Activity (Shares) | Activity | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Stock options exercised | 350,757 | 1,230,581 | 1,883,177 | 3,590,897 | | Shares issued under ESPP | 180,091 | 187,614 | 180,091 | 187,614 | | Shares issued for vested RSUs | 1,096,546 | 689,221 | 1,648,374 | 851,216 | | Shares repurchased | (3,361,396) | (1,816,362) | (3,361,396) | (5,000,000) | Cash Flow from Common Stock Activities (in thousands) | Activity | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Cash received from stock options exercised | $478 | $100 | $659 | $197 | | Cash received from ESPP shares | $156 | $238 | $156 | $238 | | Cash paid for shares repurchased | $(3,592) | $(3,360) | $(3,592) | $(8,274) | - The stock repurchase program, approved on January 23, 2024, authorizes up to **$50 million** in repurchases until December 31, 2025[70](index=70&type=chunk) - As of June 30, 2025, **$37.335 million** remains available[70](index=70&type=chunk) - In the six months ended June 30, 2025, **3,361,396 shares** were repurchased at an average price of **$1.07 per share**, totaling **$3.592 million**[71](index=71&type=chunk) - In the six months ended June 30, 2024, **5,000,000 shares** were repurchased at an average price of **$1.65 per share**, totaling **$8.274 million**[71](index=71&type=chunk) [Note 9 – Stock-Based Compensation](index=22&type=section&id=Note%209%20%E2%80%93%20Stock-Based%20Compensation) Stock-Based Compensation Costs (in thousands) | Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | RSUs | $1,435 | $1,397 | $2,487 | $2,609 | | Stock options | $634 | $1,612 | $1,358 | $3,226 | | ESPP | $84 | $42 | $138 | $79 | | Total stock-based compensation costs | $2,153 | $3,051 | $3,983 | $5,914 | - Total stock-based compensation costs decreased by **$0.898 million (29.4%)** for the three months ended June 30, 2025, and by **$1.931 million (32.6%)** for the six months ended June 30, 2025, compared to the prior year periods[73](index=73&type=chunk) - Unrecognized future compensation costs as of June 30, 2025, were **$22.215 million**, expected to be recognized over a weighted-average period of **2.9 years**[77](index=77&type=chunk) - Restricted stock grants to Dahae executives (**238,806 shares** issued in October 2024) vested **63,966 shares** during the six months ended June 30, 2025[77](index=77&type=chunk) [Note 10 – Basic and Diluted Loss Per Share](index=24&type=section&id=Note%2010%20%E2%80%93%20Basic%20and%20Diluted%20Loss%20Per%20Share) Basic and Diluted Loss Per Share | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss attributable to common stockholders (in thousands) | $(25,338) | $(22,274) | $(40,488) | $(43,481) | | Weighted average shares outstanding – basic and diluted | 180,343,931 | 177,588,035 | 180,871,314 | 179,186,027 | | Basic and diluted loss per share | $(0.14) | $(0.13) | $(0.22) | $(0.24) | - Diluted loss per share was computed without consideration of potentially dilutive instruments due to net loss, as their inclusion would be anti-dilutive[79](index=79&type=chunk) - Total potentially dilutive securities excluded from diluted EPS calculation were **45,755,244 shares** for the six months ended June 30, 2025, down from **49,158,768** in 2024[79](index=79&type=chunk)[80](index=80&type=chunk) [Note 11 – Leases](index=24&type=section&id=Note%2011%20%E2%80%93%20Leases) Lease Expense Components (in thousands) | Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Finance lease costs: Amortization of right-of-use assets | $199 | $58 | $303 | $116 | | Finance lease costs: Interest on lease liabilities | $7 | $12 | $15 | $26 | | Operating lease costs | $376 | $290 | $752 | $580 | | Total lease expense | $582 | $360 | $1,070 | $722 | - Total lease expense increased by **$0.222 million (61.7%)** for the three months ended June 30, 2025, and by **$0.348 million (48.2%)** for the six months ended June 30, 2025, compared to the prior year periods[86](index=86&type=chunk) - Weighted-average remaining lease term for operating leases is **7.5 years** with a discount rate of **6.4%** as of June 30, 2025[87](index=87&type=chunk) - Future minimum operating lease payments total **$10.611 million**, with **$0.682 million** remaining in 2025 and **$1.403 million** in 2026[87](index=87&type=chunk) [Note 12 – Related Party Transactions](index=27&type=section&id=Note%2012%20%E2%80%93%20Related%20Party%20Transactions) - BMW of North America LLC: The JDA was further amended in 2024 to extend the term, revise payment schedules, and adjust deliverables[88](index=88&type=chunk)[90](index=90&type=chunk) - The Company recognized **$0 revenue** from the JDA for the three and six months ended June 30, 2025, compared to **$430 thousand** and **$5,410 thousand** in 2024, respectively[90](index=90&type=chunk) - Dahae Energy Co., Ltd.: The Company incurred **$2,884 thousand** and **$4,285 thousand** in costs for services provided by Dahae for the three and six months ended June 30, 2025, respectively[91](index=91&type=chunk) Summarized Transactions with Dahae (in thousands) | Item | June 30, 2025 | December 31, 2024 | | :-------------------------- | :-------------- | :---------------- | | Bond | $3,169 | $3,105 | | Loan | $1,162 | $1,161 | | Warrants | $607 | $607 | | Equity method investment (a) | $1,227 | $520 | | Mezzanine equity | $140 | $34 | - The Company holds a **20% equity interest** in Dahae, accounted for using the equity method[92](index=92&type=chunk) - The Company granted **298,508 shares** of restricted stock to two Dahae executives, recorded in Mezzanine Equity, with a remeasurement of **$88 thousand** for the six months ended June 30, 2025[95](index=95&type=chunk) - A term loan facility with Dahae had a principal balance of **$1,161 thousand** at November 3, 2024, with the Company committed to provide up to **$2,000 thousand** of additional financing[96](index=96&type=chunk)[97](index=97&type=chunk) [Note 13 – Income Taxes](index=29&type=section&id=Note%2013%20%E2%80%93%20Income%20Taxes) Effective Tax Rate | Period | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Effective tax rate | 0.0% | (2.4)% | 0.0% | (1.2)% | - The Company was in a full valuation allowance for the six months ended June 30, 2025, and the year ended December 31, 2024[101](index=101&type=chunk) [Note 14 – Contingencies](index=31&type=section&id=Note%2014%20%E2%80%93%20Contingencies) - The Company may be involved in litigation in the normal course of business, and resolution is not expected to have a material adverse effect[103](index=103&type=chunk) - A putative class action lawsuit filed on December 3, 2024, against former officers and directors of DCRC alleges breach of fiduciary duties and unjust enrichment[104](index=104&type=chunk) - The Company could be liable for legal fees and defense costs for certain Hamilton Defendants[104](index=104&type=chunk) [Note 15 – Subsequent Events](index=31&type=section&id=Note%2015%20%E2%80%93%20Subsequent%20Events) - On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was enacted, permanently extending certain provisions of the U.S. Tax Cuts and Jobs Act of 2017, modifying international tax framework, restoring favorable business tax treatment, and accelerating the phase-out of EV credits[105](index=105&type=chunk) - The Company is currently assessing the OBBBA's impact on its consolidated financial statements[105](index=105&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=31&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition and results of operations, highlighting progress on development objectives, key factors affecting performance, and detailed analysis of revenue, expenses, and liquidity. It also discusses critical accounting estimates and recent accounting pronouncements [Overview](index=31&type=section&id=Overview) - Solid Power is a U.S.-based leader in solid-state battery technology, focusing on sulfide-based solid electrolyte material[107](index=107&type=chunk) - The technology aims to improve battery cell performance (energy density, life, safety) beyond conventional lithium-ion, primarily targeting the EV market[107](index=107&type=chunk) [2025 Development Objectives](index=31&type=section&id=2025%20Development%20Objectives) - Continued productive customer feedback on electrolyte sampling, driving process engineering for improved performance[110](index=110&type=chunk) - Progress towards installing a continuous electrolyte production pilot line, with detailed design work in process and long-lead time equipment ordered; commissioning expected in 2026[110](index=110&type=chunk) - Continued demand for multiple generations of electrolyte from existing and new customers, with active sampling to key strategic customers[110](index=110&type=chunk) - Completed factory acceptance testing milestone under the line installation agreement with SK On Co., Ltd. and began site acceptance testing[116](index=116&type=chunk) - Maintained fiscal discipline while investing in technology developments and process improvements[116](index=116&type=chunk) - BMW Group introduced an i7 test vehicle powered by Solid Power's cells and solid-state battery technology[116](index=116&type=chunk) [Key Factors Affecting Operating Results](index=33&type=section&id=Key%20Factors%20Affecting%20Operating%20Results) - As a research and development-stage company, Solid Power has not generated adequate cash flows from product sales or licensing to cover costs[111](index=111&type=chunk) - Commercialization depends on improving products to meet customer performance requirements and negotiating acceptable commercial agreements[112](index=112&type=chunk) - Scaling electrolyte production will require time and capital, impacting operating results[112](index=112&type=chunk) - Revenue to date primarily from R&D licensing, line installation agreements, and government contracts[113](index=113&type=chunk) - Future growth is highly dependent on consumer adoption of EVs, a rapidly evolving market influenced by technology, pricing, regulation, and consumer behavior[114](index=114&type=chunk) [Basis of Presentation](index=33&type=section&id=Basis%20of%20Presentation) - The company conducts its business through one operating segment and one reportable segment[115](index=115&type=chunk) - Historical results are reported under U.S. GAAP and in U.S. dollars, with activities primarily in the United States and Republic of Korea[115](index=115&type=chunk) [Results of Operations](index=35&type=section&id=Results%20of%20Operations) [Revenue and Grant Income](index=35&type=section&id=Revenue%20and%20Grant%20Income) Revenue and Grant Income (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change ($) | Change (%) | | :-------------------------- | :------------------------------- | :------------------------------- | :--------- | :--------- | | Revenue | $6,485 | $5,075 | $1,410 | 28% | | Grant income | $1,055 | $— | $1,055 | 100% | | Total revenue and grant income | $7,540 | $5,075 | $2,465 | 49% | | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change ($) | Change (%) | | :-------------------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | Revenue | $11,609 | $11,028 | $581 | 5% | | Grant income | $1,947 | $— | $1,947 | 100% | | Total revenue and grant income | $13,556 | $11,028 | $2,528 | 23% | - Increase in revenue and grant income for both periods primarily driven by performance on collaboration agreements and the DOE Assistance Agreement[121](index=121&type=chunk) - Collaborative revenue of **$5.9 million** (3 months) and **$10.5 million** (6 months) from SK On Agreements, including factory acceptance testing completion[122](index=122&type=chunk) - Government revenue and grant income of **$1.6 million** (3 months) and **$3.1 million** (6 months) primarily from the DOE Assistance Agreement for the continuous electrolyte production pilot line[124](index=124&type=chunk) [Operating Expenses](index=37&type=section&id=Operating%20Expenses) Operating Expenses (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change ($) | Change (%) | | :-------------------------- | :------------------------------- | :------------------------------- | :--------- | :--------- | | Direct costs | $8,462 | $5,437 | $3,025 | 56% | | Research and development | $18,342 | $18,526 | $(184) | (1)% | | Selling, general and administrative | $6,607 | $8,049 | $(1,442) | (18)% | | Total operating expenses | $33,411 | $32,012 | $1,399 | 4% | | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change ($) | Change (%) | | :-------------------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | Direct costs | $11,158 | $9,727 | $1,431 | 15% | | Research and development | $37,363 | $37,400 | $(37) | 0% | | Selling, general and administrative | $14,934 | $16,619 | $(1,685) | (10)% | | Total operating expenses | $63,455 | $63,746 | $(291) | 0% | - Direct costs increased by **$3.0 million** (3 months) and **$1.4 million** (6 months) due to milestone achievements under collaboration agreements, including **$6.7 million** in services from Dahae for the SK On line[125](index=125&type=chunk)[126](index=126&type=chunk) - Research and development costs remained materially unchanged[127](index=127&type=chunk) - Selling, general and administrative expenses decreased by **$1.4 million** (3 months) and **$1.7 million** (6 months) primarily due to decreased stock-based compensation expense from forfeitures and reduced contractor/consultant support[129](index=129&type=chunk)[130](index=130&type=chunk) - Overall operating expenses are expected to remain consistent for the remainder of the year, with a focus on cost reduction[131](index=131&type=chunk) [Nonoperating Income and Expense](index=37&type=section&id=Nonoperating%20Income%20and%20Expense) Nonoperating Income and Expense (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change ($) | Change (%) | | :-------------------------- | :------------------------------- | :------------------------------- | :--------- | :--------- | | Interest income | $3,237 | $4,520 | $(1,283) | (28)% | | Change in fair value of warrant liabilities | $(3,216) | $703 | $(3,919) | (557)% | | Total nonoperating income and expense | $(137) | $5,174 | $(5,311) | (103)% | | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change ($) | Change (%) | | :-------------------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | Interest income | $6,836 | $9,637 | $(2,801) | (29)% | | Change in fair value of warrant liabilities | $2,663 | $202 | $2,461 | 1218% | | Total nonoperating income and expense | $8,811 | $9,748 | $(937) | (10)% | - Nonoperating income and expense decreased by **$5.3 million** (3 months) due to a **$1.3 million** decrease in interest income and a **$3.9 million** period-over-period loss from changes in fair value of warrant liabilities[133](index=133&type=chunk) - Nonoperating income and expense decreased by **$0.9 million** (6 months) due to a **$2.8 million** decrease in interest income, partially offset by a **$2.5 million** period-over-period gain from changes in fair value of warrant liabilities[134](index=134&type=chunk) [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) [Sources of Liquidity](index=38&type=section&id=Sources%20of%20Liquidity) - Primary sources of cash historically include equity sales, performance milestones from partner agreements, government contracts, and interest from available-for-sale securities[135](index=135&type=chunk) Total Liquidity (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :-------------- | :---------------- | | Cash and cash equivalents | $26,248 | $25,413 | | Available-for-sale securities | $253,561 | $302,057 | | Total liquidity | $279,809 | $327,470 | - Total liquidity decreased by **$47.7 million** from December 31, 2024, to June 30, 2025[136](index=136&type=chunk) [Short-Term Liquidity Requirements](index=38&type=section&id=Short-Term%20Liquidity%20Requirements) - Short-term liquidity needs include operating and capital expenses for research and development programs and the installation of the continuous electrolyte production pilot line[137](index=137&type=chunk) - Most significant capital expenditures for the remainder of the year relate to facility engineering and construction of the pilot line, and improvements to cell development capabilities[137](index=137&type=chunk) [Long-Term Liquidity Requirements](index=38&type=section&id=Long-Term%20Liquidity%20Requirements) - The company believes current cash on hand is sufficient for operating cash needs, working capital, and capital expenditures for at least the next 12 months, including the stock repurchase program[138](index=138&type=chunk) - Longer term, additional liquidity may be required before generating adequate cash flows from electrolyte sales/licensing, or due to business changes, development delays, market adoption, supply chain issues, or regulatory changes[139](index=139&type=chunk) - The company may seek equity or debt financing if needed or opportunistically, but unavailability or unfavorable terms could adversely affect development and financial condition[139](index=139&type=chunk) [Stock Repurchase Program](index=40&type=section&id=Stock%20Repurchase%20Program) - The Board approved a stock repurchase program on January 23, 2024, authorizing up to **$50 million** in common stock repurchases until December 31, 2025[141](index=141&type=chunk) - During the six months ended June 30, 2025, **3,361,396 shares** were repurchased at an average price of **$1.05 per share**, for an aggregate cost of approximately **$3.59 million**[141](index=141&type=chunk) - During the six months ended June 30, 2024, **5,000,000 shares** were repurchased at an average price of **$1.63 per share**, for an aggregate cost of approximately **$8.27 million**[141](index=141&type=chunk) [Cash Flows](index=40&type=section&id=Cash%20Flows) Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Net cash and cash equivalents used in operating activities | $(40,734) | $(40,179) | | Net cash and cash equivalents provided by investing activities | $45,073 | $44,811 | | Net cash and cash equivalents used in financing activities | $(3,504) | $(8,531) | - Cash used in operating activities increased by **$0.5 million**, driven by offsetting cash uses, including **$3.9 million** for Dahae payments (down from **$7.7 million** in 2024) and **$19.4 million** for employee compensation (up from **$16.9 million** in 2024)[143](index=143&type=chunk) - Cash provided by investing activities increased by **$0.3 million**, influenced by changes in available-for-sale securities activity and capital expenditures[144](index=144&type=chunk) - Cash used for capital expenditures was **$3.4 million** less in 2025, primarily for the continuous electrolyte production pilot line, partially offset by **$2.0 million** from DOE[146](index=146&type=chunk) - Cash used in financing activities decreased by **$5.0 million**, mainly due to reduced stock repurchases (**$3.6 million** in 2025 vs. **$8.3 million** in 2024)[148](index=148&type=chunk) [Off-Balance Sheet Arrangements](index=42&type=section&id=Off-Balance%20Sheet%20Arrangements) - The Company is not a party to any off-balance sheet arrangements as defined under SEC rules[149](index=149&type=chunk) [Critical Accounting Estimates](index=42&type=section&id=Critical%20Accounting%20Estimates) - The primary change is in collaborative revenue recognition, where the Company shifted from using labor hours to the cost-to-cost method for input measurement, effective January 1, 2025, to better reflect performance satisfaction[151](index=151&type=chunk) - This change is treated as a change in estimate, with prior periods not adjusted[151](index=151&type=chunk) [Recent Accounting Pronouncements](index=44&type=section&id=Recent%20Accounting%20Pronouncements) - Refer to Note 2 of the unaudited financial statements for details on recent accounting pronouncements[153](index=153&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=44&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Solid Power is not required to provide the information typically mandated by this item - The Company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[154](index=154&type=chunk) [Item 4. Controls and Procedures](index=44&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the principal executive and financial officers, evaluated the effectiveness of the company's disclosure controls and procedures, concluding they were effective as of June 30, 2025. No material changes in internal control over financial reporting occurred during the period [Evaluation of Disclosure Controls and Procedures](index=44&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) - Management, with the participation of the principal executive officer and principal financial officer, concluded that disclosure controls and procedures were effective as of June 30, 2025[156](index=156&type=chunk) [Changes in Internal Control Over Financial Reporting](index=44&type=section&id=Changes%20in%20Internal%20Control%20Over%20Financial%20Reporting) - There were no material changes in internal control over financial reporting during the three months ended June 30, 2025[157](index=157&type=chunk) [PART II. OTHER INFORMATION](index=44&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity security sales, and a list of exhibits filed with the Form 10-Q [Item 1. Legal Proceedings](index=44&type=section&id=Item%201.%20Legal%20Proceedings) The company may be involved in litigation in the normal course of business, with potential adverse impacts from defense and settlement costs or diversion of management resources. Further details are provided in Note 14 of the financial statements - The Company may be involved in litigation or other legal proceedings from time to time[159](index=159&type=chunk) - Litigation, including indemnity claims, can adversely impact the company due to defense and settlement costs and diversion of management resources[159](index=159&type=chunk) - Refer to Note 14 for more information on specific legal proceedings[159](index=159&type=chunk) [Item 1A. Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors) This section updates the risk factors from the 2024 Form 10-K, emphasizing uncertainties related to government contracts and grants, the dependence on EV adoption, and potential limitations on utilizing net operating losses or tax credits due to changes in tax law, including the OBBBA - Reliance on government contracts and grants for revenue and R&D funding, which are subject to uncertainties like changes in government priorities, funding reductions, or termination (e.g., DOE Assistance Agreement and the 'Unleashing American Energy' Executive Order)[161](index=161&type=chunk)[163](index=163&type=chunk) - Compliance with government contracting laws and regulations imposes costs and risks, including potential penalties, payment delays, or debarment for non-compliance[165](index=165&type=chunk) - Future growth and success are highly dependent on consumer adoption of EVs, a rapidly evolving market influenced by changing technologies, pricing, regulations, and consumer behaviors[166](index=166&type=chunk)[167](index=167&type=chunk) - Changes in tax law, such as the OBBBA, could limit the ability to utilize net operating losses or tax credit carryforwards, potentially increasing future income tax liabilities[169](index=169&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=48&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the company's common stock repurchase program activity for the three months ended June 30, 2025, including the number of shares purchased, average price, and remaining authorization Common Stock Repurchase Program Activity (Three Months Ended June 30, 2025) | Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Program | Approximate Dollar Value of Shares that May Yet Be Purchased under the Program | | :-------------------- | :------------------------------- | :--------------------------- | :------------------------------------------------------------------- | :-------------------------------------------------------------------------- | | April 1 - April 30, 2025 | 3,361,396 | $1.05 | 3,361,396 | $37,335,408 | | May 1 - May 31, 2025 | — | $— | — | $37,335,408 | | June 1 - June 30, 2025 | — | $— | — | $37,335,408 | | Total | 3,361,396 | $1.05 | 3,361,396 | | - The stock repurchase program, approved on January 23, 2024, authorizes up to **$50 million** in repurchases until December 31, 2025[170](index=170&type=chunk) [Item 6. Exhibits](index=49&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including organizational documents, amendments to agreements, certifications, and XBRL-related documents - Exhibits include the Second Amended and Restated Certificate of Incorporation, Amended and Restated Bylaws, and an Amendment to Assistance Agreement with the U.S. Department of Energy[171](index=171&type=chunk) - Certifications pursuant to Rule 13a-14(a) and Section 1350, along with various XBRL taxonomy extension documents, are also filed[171](index=171&type=chunk) [Signature](index=50&type=section&id=SIGNATURE) This section formally certifies the filing of the Form 10-Q report by the company's principal executive and financial officers [Filing Authorization](index=50&type=section&id=Filing%20Authorization) This section confirms the official signing and authorization of the Form 10-Q report by Solid Power, Inc.'s President, Chief Executive Officer, and Director (Principal Executive Officer), and Chief Financial Officer, Treasurer, and Secretary (Principal Financial and Accounting Officer) - The report was signed on August 7, 2025, by John Van Scoter, President, Chief Executive Officer, and Director (Principal Executive Officer)[176](index=176&type=chunk) - The report was also signed by Linda Heller, Chief Financial Officer, Treasurer, and Secretary (Principal Financial and Accounting Officer)[176](index=176&type=chunk)

Financial Data and Key Metrics Changes - In Q2 2025, the company generated revenue of $7,500,000, an increase from $6,000,000 in Q1 2025, bringing year-to-date revenue to $13,500,000 [10] - Operating expenses for Q2 were $33,400,000, up by $3,400,000 compared to $30,000,000 in Q1 2025, primarily due to costs associated with factory acceptance testing [10] - Year-to-date operating loss was $49,900,000, with a net loss of $40,500,000 or $0.22 per share [10] - Capital expenditures totaled $5,000,000, mainly for the construction of the continuous electrolyte production pilot line [10] - Total liquidity at the end of Q2 was $279,800,000 [11] Business Line Data and Key Metrics Changes - The revenue recognized in Q2 was driven by the achievement of the factory acceptance testing milestone under the line installation agreement with SK On [10] - The company is progressing on its electrolyte development roadmap, having completed ordering long lead equipment and begun detailed design for a continuous manufacturing pilot line for sulfide electrolyte production [7] Market Data and Key Metrics Changes - The company has engaged in active sampling of its electrolyte with key strategic customers, indicating ongoing demand for multiple generations of its electrolyte [8] Company Strategy and Development Direction - The company aims to drive electrolyte innovation and performance through feedback from cell development and customers, as highlighted by its partnership with BMW [5] - The collaboration with SK On is focused on developing solid-state cells based on the company's technology and operating a solid-state pilot line [6] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential to deliver strong returns for shareholders and acknowledged the commitment and support from employees, partners, and stakeholders [13] Other Important Information - The company repurchased 3,300,000 shares during Q2 at an average price of $1.05, totaling approximately $3,600,000 under its stock repurchase program [11] Q&A Session Summary - The Q&A session was briefly mentioned, but no specific questions or answers were provided in the transcript [14][15]