Eos Energy Enterprises, Inc. Q2 FY2025 earnings call

• Industry and company role: Joseph Mastrangelo attended the Pennsylvania Energy and Innovation Summit, emphasizing energy's importance for the country's growth and Eos' role in the modern grid's bulk stationary storage. - Product testing and performance: Z3 product testing showed a 40% increase in energy extraction from product launch, overcharge testing at the Edison proving ground proved the product's safety, and field installations of Z3 have achieved 87% to 89% round-trip efficiency on sub-4-hour discharge cycles. - Production ramp: Subassembly first stations are being installed, with 2 stations targeted to be up and running in the fourth quarter, improving production cycle times, part flatness by 64%, and energy efficiency by over 3%. - Bill impact: The One Big Beautiful Bill preserved Section 45X production tax credits, which is positive for Eos, and the FIAC language creates new demand for American-made products. - Commercial pipeline: Opportunities valued at $18.8 billion ended the quarter, a 37% year-over-year increase and 21% quarter-over-quarter improvement, with 50% of the pipeline being stand-alone storage projects, and data centers representing over 20% of the pipeline.

In the second quarter, Eos Energy Enterprises achieved record revenue of $15.2 million, a 46% increase from Q1, accompanied by a 122% increase in shipments. Revenue was impacted by lower pricing on a single strategic project, but if calculated by the average price in the backlog, quarterly sales could have topped over $20 million. Gross loss improved by 32 points from the prior quarter, and as production volume increases, gross margins are expected to improve. The company expects to achieve positive contribution margin in the fourth quarter of 2024 and positive gross margin by the first quarter of 2026. For 2025, $26 million in revenue was booked in the first half, and the full-year revenue range is expected to be $150 million to $190 million. Revenue contribution from different segments: Q2 revenue was driven by shipments, with a significant portion from a strategic project at a lower price point, while stand-alone storage projects now account for 50% of the pipeline.

• The full-year revenue range for 2025 is expected to be $150 million to $190 million. - Anticipates achieving positive contribution margin in the fourth quarter of 2024 and positive gross margin by the first quarter of 2026. - Line 2 is forecasted to come online in the first half of 2025, sharing some subassembly capacity with Line 1 and designed for total throughput and efficiency.

• Forward-looking statements are subject to risks where actual results may differ from expectations if risks materialize or assumptions prove incorrect, as described in SEC filings. - Uncertainties in project推进 such as multi-stakeholder coordination in large deals and time to close orders, as well as external factors like customer financing and order timing.

Q: When is Line 2 expected to be fully operational?

A: Line 2 is forecasted to come online in the first half of next year.

Q: What is the current status of finalizing the site for Factory 2.0?

A: Still in negotiations with multiple states, working through to get the right facility with the right long-term landlord.

Q: Post BBB law, how have customer timelines or urgency shifted?

A: Some customers wanting to move quickly due to accelerated timelines around solar and renewable credits, and inbound calls from those considering changing technology due to FIAC restrictions.

Q: As Eos scales, how is it building a partner ecosystem across integrators, developers, and channels to support broader adoption?

A: Focusing on developing strategic relationships, including working with integrators, equipment suppliers, and going through simulations before agreeing to work with a certain technology, ensuring flawless project execution for customers.