SES AI Corp Q3 FY2025 earnings call

• Record third quarter revenue of over $7 million, a 100%+ growth from the second quarter.
• Launched MU-1.0, a powerful end-to-end AI for science workflow with 5 features.
• Acquired UZ Energy in mid-September, with ESS revenue already making up ~45% of Q3 revenue.
• Formed a joint venture with Hisun New Energy Materials to contract manufacture electrolyte materials discovered via Molecular Universe.
• Plan to launch on-premise Molecular Universe to address security/privacy needs of large battery makers.
• Incorporated MU1.0's features into ESS products deployed by UZ to collect data for model training.
• Leveraging Chungju, South Korea cell factory for drones and expect growth in that segment; completed B-sample line site acceptance test with an auto OEM for EV electrolyte materials.

In the third quarter of 2025, SES AI achieved a record revenue of $7.1 million, which is a 102% increase from the previous quarter. The revenue split was approximately 55-45 between service revenue (AI-enhanced lithium metal and lithium-ion battery materials for EV applications) and product revenue (primarily from UZ Energy's energy storage system sales). For the full year 2025, revenue guidance has been updated to $20 million to $25 million due to UZ's contribution. Gross margin for the third quarter was 51%, with service revenue contributing 78% gross margin and product revenue contributing 15% gross margin.

• Full-year 2025 revenue guidance updated to $20 million to $25 million due to UZ's contribution.
• Expect UZ Energy's ESS revenue to at least double in 2026.
• Drones and EV-related revenue streams expected to grow significantly in 2026, potentially doubling or tripling total revenue from 2025 levels.
• Margin may vary quarter-to-quarter due to fluctuating service and product revenue mix.

Q: On the Hisun JV, how did the opportunity come about and what are the battery applications?

A: Hisun JV came from enterprise users of Molecular Universe requesting to buy new formulations discovered via the platform. Applications include improving low-temperature performance of LFP for ESS batteries, high-voltage electrolyte for LCL cells, and cycle life for 12% silicon lithium-ion cells for EV applications.

Q: Can you elaborate on the 3 sub-tiers within enterprise subscription and other subscription options?

A: Enterprise sub-tiers differ in market database size, model depth, and training know-how. Subscription options include cloud-based and on-premise Molecular Universe, with SaaS platform expected to grow in seats and material supply from discovered formulations being a larger revenue driver.

Q: Regarding liquidity and impact of scaling Molecular Universe/UZ Energy integration?

A: Liquidity balance is strong, expected to exit 2025 with $195M-$200M. Laser-focused on funding growth from various streams (ESS, drones, materials, MU SaaS) with CapEx-light business model.

Q: Update on MU roadmap for 2026 and other features requested?

A: MU-1.0 expanded to cover electrode process optimization and cell design/manufacturing optimization. Working on custom Molecular Universe solutions for major battery companies to act as their 'battery bible'.

Q: Status on 2170 and LMA pouch cells for robotics, drones, UAM?

A: Pouch cells for drones seeing convergence around 10 amp-hour format. Chungju, South Korea facility converting capacity to make these cells, with growing demand especially outside China.