Financial Data and Key Metrics Changes - Consolidated revenues for Q3 2025 declined slightly to $7.5 million from $7.9 million in the prior year period due to lower APC segment revenues, partially offset by higher Fuel Chem segment revenue [27] - Consolidated gross margin rose to 49% of revenues from 43% in the prior year, driven by increases in both Fuel Chem and APC segment gross margins [27] - Net income for Q3 2025 was $303,000 or $0.01 per share, compared to a net income of $80,000 or $0.00 per share in the prior year period [29] Business Line Data and Key Metrics Changes - Fuel Chem segment revenue improved to $4.8 million from $4.6 million, while APC segment revenue declined to $2.7 million from $3.2 million due to timing of project execution [27] - Fuel Chem's full year 2025 segment revenue is now expected to approximate $16.5 million-$17 million, up from prior guidance of $15 million-$16 million [15] - APC segment backlog increased to $9.5 million at the end of Q3 2025, up from $6.2 million at the end of 2024 [28] Market Data and Key Metrics Changes - The company is pursuing $3 million-$5 million of potential additional APC contracts expected to close before the end of the year or early Q1 2026 [15] - The sales pipeline for data center opportunities is valued at approximately $80 million-$100 million, with eight to ten opportunities currently being pursued [22][42] Company Strategy and Development Direction - The company is focusing on expanding its APC portfolio through strategic acquisitions and enhancing its technology base to address global customer needs [16][18] - There is a strong emphasis on the digital economy, including AI and data centers, which is driving new power generation demand and creating opportunities for emissions control solutions [20][21] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining a strong financial position and funding growth initiatives across its business segments [32] - The company anticipates continued demand for its technology solutions, particularly in the context of the electrification of everything and industrial transitions [20][21] Other Important Information - The company has no long-term debt and total cash and investments were reported at $33.8 million as of September 30, 2025 [30] - The acquisition of complementary APC intellectual property was completed for $350,000, which is expected to enhance the company's competitive position [16] Q&A Session Summary Question: Will additional investments be needed to monetize the recent acquisition? - Management does not expect significant incremental investment to capitalize on the acquired IP, with some small contributions anticipated relatively quickly from aftermarket opportunities [37] Question: How is the company approaching data center opportunities? - The company is typically brought into data center projects through engine or turbine OEMs and is also engaging with non-traditional players looking to repurpose aircraft engines for power generation [40][41] Question: What is the current pipeline size for data center opportunities? - The current pipeline consists of eight to ten opportunities valued at $80 million-$100 million, with expectations for some commercial opportunities to finalize by the end of the year or early 2026 [42][43] Question: What are the expectations for cash flow in Q4? - Management anticipates cash balance to be flat to slightly down by the end of the year, with Q3 typically being the best performing quarter [54] Question: Did the previous global sales pipeline include data center opportunities? - The previous pipeline number did not include data center opportunities, which are now valued at $80 million-$100 million, in addition to $10 million-$20 million in standard APC business [58][59]

Core Insights - Fuel Tech, Inc. reported a profitable third quarter with a significant increase in its Air Pollution Control (APC) backlog by over 20% since June 30, 2025, ending the quarter with $33.8 million in cash and no debt [2][3]. Financial Performance - Consolidated revenues for Q3 2025 decreased to $7.5 million from $7.9 million, primarily due to lower APC revenues, while FUEL CHEM revenues increased [7][10]. - The consolidated gross margin improved to 48.9% from 43.4%, reflecting better margins in both APC and FUEL CHEM segments [7]. - Net income for Q3 2025 was $303,000, or $0.01 per share, compared to $80,000, or $0.00 per share in the prior year [8]. Business Segment Performance - APC segment revenue fell to $2.7 million from $3.2 million, attributed to project execution timing, but gross margin increased to 47.2% from 35.0% [9]. - FUEL CHEM segment revenue rose to $4.8 million from $4.6 million, with gross margin expanding to 49.8% from 49.2% due to increased sales activity [10]. Strategic Developments - The company made a strategic acquisition of APC intellectual property from Wahlco, Inc. for $350,000, enhancing its technology portfolio [5]. - Fuel Tech is actively pursuing opportunities in power generation, particularly for data centers and public utilities, and is engaged in multiple bids for its Selective Catalytic Reduction (SCR) technology [4]. Cash and Investments - As of September 30, 2025, the company had cash and cash equivalents of $13.7 million, short-term investments of $12.2 million, and long-term investments totaling $8.0 million [11].

Financial Data and Key Metrics Changes - Consolidated revenues for 2024 were $25.1 million, at the lower end of the guidance range of $25 million to $26 million, reflecting a 17% decrease in total APC segment revenue, partially offset by a 2% increase in FUEL CHEM revenue [7][32] - Consolidated gross margin for 2024 marginally decreased to 42% from 43% in the previous year, with a decline in both APC and FUEL CHEM gross margins [33] - Net loss for 2024 was $1.9 million or $0.06 per diluted share, compared to a net loss of $1.5 million or $0.05 per diluted share in 2023 [35] Business Segment Data and Key Metrics Changes - FUEL CHEM segment revenue was essentially unchanged at $3.5 million for Q4 2024, while APC segment revenue declined to $1.8 million from $2.8 million in the prior year [27] - APC gross margin declined to 36% from 55%, primarily due to product mix and lower segment revenue, while FUEL CHEM gross margin declined to 45% from 48% [28] - Consolidated APC segment backlog at December 31, 2024, was $6.2 million compared to $7.5 million at the end of 2023, with expectations for backlog improvement through the first half of 2025 [29] Market Data and Key Metrics Changes - The company is pursuing additional FUEL CHEM accounts, with a demonstration scheduled for late Q3 2025, and is in discussions to expand its chemical technology in Mexico [11][12] - The global data center power market is expected to expand significantly, with investments in emissions control solutions to address surging electricity demand [15][86] - The company is following opportunities in the municipal solid waste market driven by state-specific regulatory requirements [14] Company Strategy and Development Direction - The company aims to exceed $30 million in total revenues for 2025, with expectations that both business segments will outperform their 2024 performance [24] - The company is focusing on the commercialization of its DGI technology, with ongoing demonstrations and discussions in various end markets [22][23] - The company is exploring small acquisitions or licensing opportunities to enhance its market position [114] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2025, citing a strong portfolio of APC business opportunities and a return to normalized operations in FUEL CHEM [9][14] - The company does not expect significant contributions from new EPA regulations but is monitoring the regulatory landscape for potential impacts [16][20] - Management indicated that achieving breakeven on operating income would likely require revenues closer to $33 million to $35 million [112] Other Important Information - The company ended 2024 with cash, cash equivalents, and investments totaling approximately $30 million and no long-term debt [8][36] - SG&A expenses increased to $13.8 million for 2024, reflecting higher employee-related costs [33] Q&A Session Summary Question: Is the $30 million revenue outlook for 2025 based on confidence in securing additional FUEL CHEM customers and APC orders? - Management confirmed that the APC orders are included in the outlook, but contributions from new FUEL CHEM accounts are not expected to be significant in 2025 [44] Question: What is the expected gross margin trend for 2025? - Management anticipates a return to historical gross margins of 49% to 50% for FUEL CHEM, while APC margins are expected to remain in the 35% to 38% range [54][56] Question: Are there any impacts from tariffs on the supply chain? - Management acknowledged potential impacts from steel and aluminum tariffs, which could affect costs but would be passed on to end customers [66] Question: What is the timeline for data center-related orders? - Management indicated that delivery schedules for data center orders would typically be around 40 weeks from order to delivery [104] Question: Is the company considering M&A or stock buybacks? - Management is exploring small acquisitions and licensing opportunities but believes current business momentum will drive shareholder value without the need for buybacks [114][116]