0001628280-25-049588
SEC filingEos Energy Enterprises reported a net loss of $641.4M in Q3 2025, driven by non-cash fair value adjustments on warrants and derivatives, while revenue surged to $30.5M from $0.9M a year ago.
Eos Energy Enterprises reported revenue of $30.5 million for the third quarter of 2025, a dramatic increase from $0.9 million in the same period last year, driven by higher product sales and selling prices. Cost of goods sold rose to $64.4 million from $25.8 million, reflecting increased production volume partially offset by lower unit costs. The gross loss widened to $33.9 million from $24.9 million, as the company remains in early commercialization with significant start-up costs.
Operating expenses decreased slightly to $27.3 million from $28.4 million, with a decline in research and development costs offset by higher selling, general and administrative expenses related to headcount expansion. The operating loss increased to $61.2 million from $53.3 million.
Net loss attributable to common shareholders was $1.33 billion compared to $384 million in the prior year, largely due to non-cash fair value adjustments on warrants and derivatives, as well as the remeasurement of preferred stock. Basic and diluted loss per share was $4.91 versus $1.77.
As of September 30, 2025, total assets were $328.2 million, up from $260.3 million at year-end 2024, driven by increases in cash, restricted cash, inventory, and property, plant and equipment. Total liabilities surged to $1.43 billion from $842 million, primarily due to higher warrant liabilities and debt. Shareholders' deficit deepened to $2.32 billion from $1.07 billion, reflecting accumulated losses and preferred stock remeasurements.
Working capital (current assets minus current liabilities) was $85.4 million, providing some near-term liquidity. However, the company had only $58.7 million of unrestricted cash and cash equivalents. Total debt, including related-party notes, stood at $539 million carrying value, with $250 million in 6.75% convertible notes due 2030 being the largest component.
Operating cash flow used $160.9 million during the first nine months of 2025, compared to $111.3 million used in the prior year, reflecting increased losses partially offset by working capital changes. Capital expenditures totaled $29.7 million, primarily for manufacturing expansion. Free cash flow (operating cash flow less capex) was negative $189.7 million.
Financing activities provided $214.1 million, including $240 million from the 2025 Convertible Notes, $81.1 million from a public offering, $38.5 million from the Cerberus credit facility, and $22.7 million from the DOE loan. These inflows were partially offset by the repayment of $180.9 million in related-party notes and $50 million prepayment on the Delayed Draw Term Loan.
Cash, cash equivalents, and restricted cash totaled $126.8 million at quarter-end, up from $103.4 million at the beginning of the year.
Management highlights that the company has fully funded the $210.5 million Delayed Draw Term Loan and drawn the first tranche of the DOE Loan Facility ($90.9 million). The company believes these actions, combined with recent equity and debt offerings, provide a path to sustainable operations. However, substantial doubt about going concern remains due to historical losses and the need for additional capital.
The Credit Agreement and DOE Loan Facility contain financial covenants. As of September 30, 2025, only the Minimum Liquidity covenant was in effect, and the company was in compliance. Revenue and EBITDA covenants are deferred until March 31, 2027.
Strategic highlights include the launch of the DawnOS battery management system, international expansion through a memorandum of understanding with Frontier Power Ltd. for 5 GWh, and continued progress on the Z3 battery production line. The company also noted the impact of the One Big Beautiful Bill Act, which it does not expect to materially affect its financial statements.
Revenue is recognized from product sales (point in time) and service revenue (over time). For the three months ended September 30, 2025, product revenue was $30.2 million and service revenue was $0.3 million. The company has one operating and reportable segment.
Contract liabilities were $19.2 million at quarter-end, down from $26.3 million at year-end 2024, reflecting revenue recognition on advance payments. Remaining performance obligations were approximately $77.2 million, with 76% expected to be recognized within the next twelve months.
Stock-based compensation was $5.0 million in Q3 2025 and $19.7 million for the nine months. The company recognized production tax credits of $5.7 million in Q3 and $12.0 million for the nine months, recorded as a reduction to cost of goods sold.
The company recorded a loss from write-down of property, plant and equipment of $0.6 million in Q3, primarily due to design changes from Z3 Phase 1 to Phase 2 production.
Warrant liabilities at fair value totaled $870.6 million, including related-party warrants. The change in fair value of warrants was a $240.8 million expense in Q3, and the change in fair value of derivatives (related parties) was a $327.8 million expense.
On subsequent events, the company announced satisfaction of all final performance milestones under the Credit Agreement on October 31, 2025, meaning no additional preferred stock or warrants will be issued to Cerberus.