Earnings call transcript: Energy Vault misses Q2 2025 forecasts, stock dips

Energy Vault Holdings Inc. (NRGV) reported its financial results for the second quarter of 2025, revealing a significant miss on both earnings and revenue forecasts. The company reported an earnings per share (EPS) of -$0.22, falling short of the forecasted -$0.11. Revenue came in at $8.5 million, significantly below the expected $25.93 million. Following the announcement, Energy Vault’s stock dropped 12.14% in premarket trading, reflecting investor disappointment. According to InvestingPro data, the company has been quickly burning through cash, with a negative free cash flow yield and current ratio of 0.86, indicating potential liquidity concerns.

Key Takeaways

• Energy Vault reported a larger-than-expected loss per share and missed revenue estimates significantly.
• The company highlighted a 126% year-over-year increase in revenue, despite missing forecasts.
• Energy Vault’s stock reacted negatively, dropping over 12% in premarket trading.
• The company is focusing on expanding its energy storage projects globally.

Company Performance

Energy Vault’s performance in Q2 2025 showed a stark contrast between impressive year-over-year growth and missing analyst expectations. The company’s revenue of $8.5 million represented a 126% increase from the same quarter last year. However, this was overshadowed by the significant shortfall compared to forecasts. InvestingPro analysis reveals that despite current challenges, analysts anticipate substantial sales growth, with revenue projected to grow by 348% in fiscal year 2025. Get access to 15+ additional ProTips and comprehensive financial analysis with an InvestingPro subscription. The company’s strategic focus on expanding its energy storage projects in the U.S., Australia, and Europe is noteworthy, as it attempts to capture a larger market share in the energy sector.

Financial Highlights

• Revenue: $8.5 million, up 126% year-over-year
• Earnings per share: -$0.22, compared to -$0.11 forecasted
• GAAP Gross Margin: 29.6%, up from 27.8% last year
• Adjusted EBITDA Loss: $13.7 million, improved from $15.4 million in Q2 2024
• Cash Position: $58.1 million, up 23% sequentially

Earnings vs. Forecast

Energy Vault’s actual EPS of -$0.22 was a significant miss against the forecasted -$0.11, marking a 100% negative surprise. The revenue of $8.5 million fell short of the $25.93 million forecast, resulting in a 67.22% revenue surprise. This performance contrasts sharply with the company’s previous quarters, where it showed more alignment with analyst expectations.

Market Reaction

Following the earnings announcement, Energy Vault’s stock experienced a notable decline, dropping 12.14% in premarket trading. This movement places the stock closer to its 52-week low of $0.596, a stark contrast to its high of $2.695. Based on InvestingPro Fair Value calculations, the stock appears to be trading above its intrinsic value, despite showing strong returns of over 33% in the past week and 52% over the last year. The stock’s RSI suggests it may be in overbought territory, warranting careful consideration by investors. The broader market trend remains largely stable, indicating that the stock’s decline is primarily driven by the disappointing earnings report.

Outlook & Guidance

Looking forward, Energy Vault projects full-year 2025 revenue between $200 million and $250 million. The company is targeting a cash position of $60 million to $75 million for the third quarter. Energy Vault also aims for $100 million in recurring EBITDA within the next three to four years and plans to spend $1 billion in CapEx for project development.

Executive Commentary

CEO Robert Picone emphasized the company’s execution capabilities, stating, "We are excellent at execution. We deliver." He also highlighted the strategic importance of a recent $300 million equity investment, which is expected to enable over $1 billion in CapEx and project financing.

Risks and Challenges

• The significant miss on earnings and revenue forecasts may undermine investor confidence.
• Energy Vault faces the challenge of executing its ambitious project pipeline in a competitive energy market.
• Macroeconomic pressures and potential supply chain disruptions could impact future performance.
• The company’s ability to secure long-term offtake agreements remains crucial for sustained growth.

Q&A

During the earnings call, analysts inquired about the company’s project financing strategy and its focus on early-stage project development. Energy Vault detailed its approach involving project-level debt, tax equity, and equity contributions. The company also discussed its plans to secure a significant pipeline of projects for completion by 2027.

Full transcript - Energy Vault Holdings Inc (NRGV) Q2 2025:

Michael, Investor Relations/Moderator, Energy Vault: Thank you. Hello, and welcome to Energy Vault’s second quarter twenty twenty five financial results conference call. As a reminder, Energy Vault’s earnings press release and presentation are now available on our investor website, and we’ll be referring to these presentations during the call. I believe there was a slight delay on Business Wire, so please access those on our website if you were unable to get that email. A replay of this call will be available later today on the Investor Relations portion of our website.

This call is now being recorded. If you object in any way, please disconnect now. Please note that Energy Vault’s earnings release and this call contain forward looking statements that are subject to risks and uncertainties. These forward looking statements are only estimates and may differ materially from the actual figures or events or results due to a variety of factors. Please refer to our most recent 10 ks or 10 Q filing for a list of factors that cause our results to differ from those anticipated in any forward looking statement.

We undertake no obligation to publicly update or revise any forward looking statements, except as required by law. In addition, please note that we will be presenting and discussing certain non GAAP information. Please refer to the Safe Harbor disclaimer and non GAAP financial measures presented in our earnings release for more details, including a reconciliation to comparable GAAP measures. Joining me on the call today is Robert Picone, our Chairman and Chief Executive Officer. At this time, I’d like to hand the call over

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: to Robert. Michael, and thanks to all of you joining the call. Before jumping into the Q2 financial results as normal here, I thought I would kick off highlighting one of the significant announcements made this morning before the market opened. As all of you know, a little over a year ago at our May 2024 Investor Day, we outlined a bold strategy to leverage our significant technology and operational expertise in designing, building, and monitoring storage systems to also developing, owning, and operating energy storage systems. Given the significant benefits of having less lumpy and more predictable revenue streams that are highly profitable, recurring and supported by long term off take agreements.

This strategy was focused on getting more portfolio exposure to a much higher profit pool segment within the energy ecosystem and really fundamentally creating more long term value for our shareholders. We proceeded to execute on getting our first two owned projects in Texas and California placed in service as expected this year and recently announced, and also completed the project financings for both of them as recently announced and have been putting cash therefore back on the balance sheet. While the first two projects were funded from our balance sheet, the announcement this morning now answers what’s been on investors’ minds about how Energy Vault will fund the execution of our growing project development portfolio, with a $300,000,000 preferred equity investment to fund the development, construction and operation of our storage IPP own and operate projects, which we call asset vault. I want to go over a little bit about what this means, as highlighted from the announcement. The $300,000,000 equity will enable over $1,000,000,000 in CapEx and project financing toward constructing and operating the new storage IPP projects.

While the funds are targeted at an initial 1.5 gigawatt of projects already progressing in mid to later stage development, It also funds earlier stage development, or DevEx, of our total three gigawatt development pipeline of projects in The US, Australia, and Europe. In addition to the first two projects recently placed in service in The US and now a part of Asset Vault, the next projects coming online in the next two to three years will create annual EBITDA cash streams of over $100,000,000 predictable and recurring. Just as critical in funding the projects is that this investment of the $300,000,000 preferred equity is non dilutive to common shareholders, and we have built mechanisms for milestone based equity participation that aligns us as partners along the way. This is critical given many of the convertible type financings done have been highly dilutive to existing shareholders from other deals that is not the case here. Important to also note that EBITDA streams from AssetVault are in addition and complement EnergyVault’s synergistic energy storage solutions business to third party global utilities, IPPs, and other high demand energy users.

On top of that, as was the case with the first two energy assets already in service in The US and Texas and California, the Asset Vault subsidiary will contract to Energy Vault all of the product design, construction, commissioning, and long term service agreements, thereby providing additional cash flow streams and liquidity back to the parent company. We’re going to be having a virtual investor day post close of the transaction that we’ll schedule to go over more details of the transaction, and also some of the language around this part of the business. You’re going to hear us talking more and using megawatts, for example, instead of megawatt hours, as that’s what we’re being contracted to deliver. And we’ll be going over some KPIs related to multiples of those megawatts to come up with the relevant financial statistics. Just a few thoughts here before jumping back to the results.

I’m sure it’s not lost on everyone how important the timing is of this investment and the transformation that an investment like this will enable in our forward financials. As a company, we have been good in to position and structure something like this as we’ve remained without debt at the corporate level since becoming a public company. And given project timing, initially used our balance sheet to get the first two projects underway here in The US. But what really excites me about this, and I want to highlight to investors as a final point here, is this now becomes about execution. Having run a few public and private companies in my career, focus is so important to successful execution.

And one of the things that Energy Vault has quickly built a strong reputation on in the market and demonstrated in spades with our customers and our partners is that we are excellent at execution. We deliver. That’s managing supply chains, building, commissioning, and reliably and safely executing projects, and monitoring and operating assets. You can imagine the diligence a company like ours undergoes, especially these days and in these markets as a newer growth company, whether that be the banks that did the two project financings that we recently completed, infrastructure funds like we just announced this morning, government owned entities like we’ve contracted with in Australia the last year, and even public utilities who are not in the business of taking any risk. And generally here, bankability is fundamental.

As part of their DD, all of these groups I just mentioned have talked to our prior customers or partners where we have executed projects. And I think the results now and how we are expanding the business and these agreements speak for itself. With that, I’m going to turn to the Q2 financial results and have seven main points to highlight. Fundamentally, we start always with contract revenue here in the backlog, a tremendous signal to investors increasing again quarter over quarter 47% to almost $1,000,000,000 now, $954,000,000 versus Q1 and up 120% year to date. This is driven by new third party project and service agreements, as well as long term off take agreements in The US and Australia.

The revenue also increased on a year over year basis, dollars 8,500,000.0 compared to the prior year period, driven by Australia project deliveries and also the commencement this quarter of our Cross Trails battery energy storage system in Texas. The GAAP gross profit increased 140% versus prior year to $2,500,000 as favorable geographic and revenue mix resulted in a gross margin of 29.6%. The adjusted EBITDA also improved 11% versus prior year, narrowing the loss to $13,700,000 from a loss of $15,400,000 in Q2 ’twenty four, aided by the improved gross margins just mentioned, and some of the reduced operating costs that again we took some additional steps this past quarter for an additional $6,500,000 in cost savings initiatives. That’s an annualized number. We’ll continue to invest, for example, in Australia to support some of the long term growth and initial project starts there.

Importantly, cash improved 23% versus just last quarter to 58,100,000.0 at June 30, finishing at the high end of the previous guidance range. Since then and looking a bit forward, we completed the Cross Trails project financing just last month of 17,800,000.0 in July, and we’re expecting another $27,000,000 in net investment tax credit proceeds that are anticipated in September. We continue to expect to be within the prior revenue recognition and cash ranges with much of the larger battery deliveries expected now the latter half of the year in Q4, given some of the market shocks and pause from the tariff dispute with China that we absorbed in the first half of the year. Finally, and before turning over to Michael, one special thank you to go out to our Australia teams and partners from the other announcement, also quite important. We made this morning achieving final close of the acquisition of the 125 megawatt, one gigawatt hour Stoney Creek battery energy storage system, now the largest in our new own and asset portfolio.

Of course, this is largely expected, getting through final firm government and share transfer approvals are never guaranteed. And I want to call out our local energy vault leaders, Lucas Sadler and Raymond Guilfetter and their teams, the legal team from Hamilton Lock locally, our development partner, Ross Warby, his team from EnerVest, and all of those here in The US that worked across time zones to complete this. We look forward to pushing this through to final DA approvals and into RTB or ready to build construction in the coming months. With that, I’ll turn it over to Michael to go over the details of the financial results.

Michael, Investor Relations/Moderator, Energy Vault: Thanks, Rob. Turning to our latest backlog and developed pipeline, as you highlighted, the company currently maintains a revenue backlog of $954,000,000 up 47% versus this time last quarter and 120% year to date, driven by new third party projects and service agreements as well as long term offtake agreements in both The U. S. And Australia. Notably, this includes our contracts with Consumers Energy, a new long term service agreement with an existing customer and our largest project in Australia to date, as you mentioned, the recently acquired 125 megawatt Stony Creek project in New South Wales, which is supported by a fourteen year offtake agreement discussed previously.

These figures compare to the $550,000,000 plus in recognized revenue or 1.1 gigawatt hours in executed projects to date, as depicted on slide five in the earnings presentation. Meanwhile, our total developed pipeline for our advanced projects, either third party and or those that we would look to own and operate, is around $2,400,000,000 or roughly six gigawatt hours, which we expect to be strengthened by the launch of AssetVault, EnergyVault’s build, own and operate arm, detailed in today’s announcement and outlined in the last slide of our earnings presentation, which I’ll discuss further later on. Turning to Q2 results. On the revenue side, we delivered Q2 revenue of $8,500,000 up 126% year over year, and that’s driven by activity across our Australian project portfolio in the first month of commercial operations at Cross Trails in Texas. GAAP gross margin of 29.6% was up from 27.8% a year ago, reflecting a stronger regional and business revenue mix.

On adjusted operating expense, 16,200,000.0 improved 2% year over year despite the increased revenue and gross margin, demonstrating continued cost discipline. We implemented an additional $6,500,000 in annualized savings during June and July, as the company continues to refine its long term strategy, offset by strategic investments in Australia to support that growth. On the adjusted EBITDA front, excluding stock based compensation and other one time items outlined on Slide eight of the earnings presentation, adjusted EBITDA improved 11% year over year to a loss of $13,700,000 compared to a loss of $15,400,000 in Q2 twenty twenty four, driven by increased revenue and gross margin, as well as a slight decline in operating expenses. From a cash and project financing perspective, we ended Q2 with $58,100,000 in cash, up 23% sequentially and at the upper end of our guidance range. Now turning to our business outlook.

Reflecting the timing of U. S. Battery deliveries associated with the Consumers Energy projects and other project timelines in Australia, we’re estimating full year 2025 revenue of between 200,000,000 and $250,000,000 within the prior guidance range. From a cash and project financing perspective, we are estimating between 60,000,000 and $75,000,000 in total cash at the end of the third quarter, unchanged versus prior guidance, and including the Cross Trails project financing of 18,000,000 which was completed in July, with another $27,000,000 in total net ITC proceeds anticipated in September, offset by quarterly operating expenses, working capital and other CapEx. Introducing AssetBault.

Earlier today, EnergyBall announced that it had entered into an exclusive agreement for a $300,000,000 preferred equity investment subject to customary regulatory and closing conditions estimated in the next thirty to sixty days. By partnering with a leading multibillion dollar infrastructure fund, we expect to enable over $1,000,000,000 in CapEx spending for about 1.5 gigawatts of projects under development in The U. S, Australia and Europe. The project portfolio is prioritized with a clear monetization strategy, supported by long term off take agreements with bankable partners and or in attractive merchant markets. Further, by leveraging Energy Vault’s existing EPC capabilities, as well as a host of other services we provide today to our third party customers, we can unlock notable synergies across the business, including larger volume commitments with suppliers and etcetera, adding incremental cash flows and liquidity to the parent company.

As part of this strategy, as outlined in our May twenty twenty four Analyst and Investor Day, we’ve officially placed both the Calistoga Resiliency Center in California and the Cross Trails project in Texas into service and have also completed their respective project financings. These two assets are expected to generate nearly $10,000,000 in recurring annual EBITDA going forward. Further, the recently announced Stoney Creek project serves as a major milestone, resulting in nearly 1.4 gigawatt hours of total capacity under management once that project is complete in 2027, with construction expected to commence in Q1 twenty twenty six. Once operational, that project is expected to generate roughly $20,000,000 in annual recurring EBITDA, further accelerating our path to $100,000,000 in recurring EBITDA goal over the next three to four years. In conjunction with the close of the $300,000,000 preferred equity investment, again subject to customary regulatory and closing conditions, Energy Baldwin tends to host a virtual Investor Day to provide a comprehensive overview of the asset vault portfolio.

Its project pipeline, financial projections and accounting treatment surrounding the consolidated subsidiary, as well as the long term strategic vision. Additional details will be provided upon closing. With that, I’ll hand the call back over to Rob.

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: Well, thank you. And before we open up for questions, I again want to thank all the employees of Energy Vault that have been working diligently across the globe, progressing a lot of the things we’ve discussed today. And I think not a small milestone for us in progressing now toward a commitment related to $300,000,000 to take our project portfolio now forward. And really, to highlight and emphasize, I think from an investor perspective, a very strong focus of the company now on executing those projects, which I think we’ve done a very good job of across the world. So, with that, operator, we’ll turn it back to you for any questions.

Conference Call Operator: Certainly. And we can take our first question from Justin Clare with ROTH Capital Partners. Your line is open.

Justin Clare, Analyst, ROTH Capital Partners: Hi, Thanks for taking the questions here, and congratulations on the preferred equity transaction. Guess I first wanted to start on the preferred. I just want to see if you’d be able to share any more details at this point on the return structure, what the preferred dividend yield might look like or any milestones that are tied to the equity participation in Energy Vault Holdings or do we need to wait until the conference call coming up for that?

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: Yeah, thanks Justin. Yeah, we purposely are scheduling this virtual call with investors just post the close of that, where we’re going to be stepping through and walking through all that. For regulatory and compliance purposes, we aren’t going to get into that detail right now, but we’re looking forward to walking people through all of those things at the investor call that we’re going to be hosting just after the close.

Michael, Investor Relations/Moderator, Energy Vault: I think one way to sort of think about it, there’s a slide in the deck, slide 14, that sort of talks about the broader portfolio. Obviously, these projects and their sort of intended levered IRRs would adequately support any project financing and or distributions associated with the preferred equity.

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: Justin, there’s some good content in there where you can you’ll be able to make some assumptions there based on levered IRRs that are included and assumptions in and around the financing.

Justin Clare, Analyst, ROTH Capital Partners: Okay, got it. I guess, maybe at this point, not specifically on the preferred equity, but you had talked about $1,000,000,000 of CapEx. Maybe you could speak to more broadly what the financing strategy there is in terms of project level debt versus tax equity versus the potential equity contribution from Energy Vault?

Michael, Investor Relations/Moderator, Energy Vault: Yeah. No. Certainly. So we would expect that much of the portfolio will be in The US. We haven’t necessarily articulated what the split will be, but it’ll be US centric.

And as a result, there will be pretty notable ITC related benefits. We obviously now have some comfort around recent guidance that was given around those sort of storage ITCs. But the way I would think about it, on a, let’s call it, dollars 100,000,000 project, one could assume virtually half of that would be covered through normal course project financing. You should assume anywhere between 30,000,000 to $40,000,000 30% to 40% of that would be covered vis a vis the ITC mechanism. Obviously, there are sort of costs in transferring those ITCs, but you could use a 30% type figure.

And then of that remaining 20% related to the equity contribution required, there would be some split between common equity and sort of the preferred element. So, hopefully, directionally, that gives you a sense. And quite frankly, this is the same sort of split that we had for, say, the Cross Trails project and even that with Calistoga. Having just gone through this process, constructing financing, making sure that we have a really optimized capital stack, post COD, it’s a playbook that we know well now.

Justin Clare, Analyst, ROTH Capital Partners: Got it. Okay.

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: That’s helpful. One thing just to add in terms of also use of the fund, and this was mentioned in the announcement, but the other purpose of the fund is to invest in DevEx or some of the earlier development phases you go through when you’re getting projects through different phases from the permitting phases, design approvals, and things. So, that’s the other use of fund. And then we also have flexibility to take minority interests in projects, for example, where we’re providing storage solutions and to work a little more closely with our customers in that regard as partners. So, it really gives us a lot of flexibility, I think, in how we look to grow all pieces of the business.

Justin Clare, Analyst, ROTH Capital Partners: Okay, got it. That’s helpful. And then maybe if I could just sneak one more in here. I’m just looking at slide 14, where you have kind of COD dates for projects in the pipeline here. It looks like close to a gigawatt of projects potentially in 2027 are planned for completion.

So just wondering if you could share a little bit more detail on where those are in the development process. Like have you secured permits? Has interconnection been secured? Are the contracts already or are the projects already contracted? Any additional detail there would be helpful.

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: Yeah, sure. I think just for some visibility, and we had in the past had also provided a chart online that showed actually some of the projects and where they were actually in their development phases. So, you should have had that online. But Stoney Creek, of course, is one of the larger ones that we announced and that the timelines I think are included in that announcement there in 2027. And you can assume there’s a few projects more in Australia that are progressing through,

Michael, Investor Relations/Moderator, Energy Vault: let’s

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: say mid development and some of them to later development stages here shortly this year. And also a few in The US that are also in, I’d say, mid development stages. There’s one to two in Europe as well that we’re progressing. So, I’d say a lot of these projects are going to be four, and in some cases, some of them are eight hour durations, which is I think getting a little more common in Australia, for example. I think The US and Europe are closer to more the average of the four hours.

And as I said, I think they’re all set from their development. And as we look at funding and moving them through, we’re looking at having a lot of them come online in 2027.

Justin Clare, Analyst, ROTH Capital Partners: Okay, great. Thank you. I’ll pass it on.

Conference Call Operator: And we can move next to Noel Parks with Tuohy Brothers. Your line is open.

Noel Parks, Analyst, Tuohy Brothers: Hi. Congratulations on the deal. And I totally understand that you want to be sort of judicious in what you disclose at this point. But I was wondering if you could just talk in just the broadest terms about maybe what is then isn’t implied in the exclusivity of the arrangement with the new preferred financing. And I mean you mentioned for example, well actually sorry that’s a sort of a separate topic.

But I’m just curious about that.

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: Yeah, I’d say we have an agreement that’s been executed. It also includes exclusivity at this stage, hence the reason we were comfortable, and also the partner is comfortable making the announcement that we did. And as we said, subject to the customary types of procedural and closing conditions here at this point. So, there’s really not the exclusivity is just that in and around this specific asset vault, and the preferred equity toward funding these projects. So, that’s the scope

Michael Renoff, Analyst, Skoggan Capital: of the exclusivity.

Noel Parks, Analyst, Tuohy Brothers: Great. Thanks. This is kind of exactly what I was wondering about whether it implied a similar relationship to other projects or parent company operations. And I was pretty excited to hear that the transaction was accomplished with an infrastructure fund. I feel like one question I’ve certainly been asking over the the quarters is what were the nature of the types of parties you’ve been talking to for additional funding.

And I had been sort of wondering how well or slowly those discussions have been going on. So I just wonder if you could again talk just very generally about what was involved in sort of landing the plane, getting to this deal and just a rough idea of how long you’ve been in talks or in the works with this particular party. I’m thinking about it’s kind of a bit of a to give a bit of a flavor for what subsequent types of deals might how they might transpire.

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: Yeah. Well, I think I’ll point to some things publicly we announced and said too. Late last year, we actually made an announcement because we had retained Jefferies to support us a bit in looking at the own and operate segment in the energy ecosystem here around energy storage. Really started to think about, I think, this year starting to look at going to market and looking at the types of infrastructure players and partners that would fit what we’re doing. We’ve obviously been in the middle of also delivering two projects.

So, I think that’s something, Noel, that folks were looking at is, as we were looking to close on projects that we had committed, like cross trails in Texas, which actually we delivered a bit early, and was up running 100% availability, for example, in July. It came up as planned May and into June. So, everything performing well. So, I think as funds looked at us and knowing that we’re getting in now to owning and operating, I think them seeing progress on how we’re executing those projects. That probably influenced some of the timing.

Although, I think it sort of coincided from when we started to really seriously start to get into the market earlier this year, and start to target certain infrastructure funds that we thought would be interested in this and would be good partners with us. So, I think some of that timing a bit coincided. And the fact also, just had the Calistoga ribbon cutting, of course, last week up in Northern California. And that’s for the PG and E system. And I think those, our ability to execute those and by the way, progress project financing.

So, the diligence you get into asset by asset when you get into those. So, I think folks seeing that we progressed those, got them financed, closed on ITC agreements, as well as Michael referenced about some of that cash that’s coming in. I think all of those factors, while in parallel, having the systems we had turned over on our traditional business, all operating well, seeing the expansion in Australia on the two construction projects that are now underway. So, I think all of those factors went into some of the timing here and the readiness, and I think the interest we had from multiple parties to look at working with us. And the last thing I’ll say is what I said in my discussion in and around the deal announcement and what’s behind it.

As a part of all that diligence, people did, they will automatically want to speak to the customers that we’ve delivered or executed projects for. How did we do to the process? How did we manage supply chain? No project goes perfectly or even close, And some projects, there’s problems you have to manage. We’ve had all the above.

But how you manage those things in front of the customer, how you deliver, how the systems are operating now, all of that, all those factors, I think were net positives as people jumped in and didn’t the type of diligence that I mentioned in some of my opening remarks. So, that’s helpful to you.

Noel Parks, Analyst, Tuohy Brothers: It is indeed. Thanks a lot.

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: Okay. Thank you.

Conference Call Operator: And we can move to our next questioner who is Michael Renoff with Skoggan Capital. Your line is open.

Michael Renoff, Analyst, Skoggan Capital: Hey, Rob. Congrats on the OAC announcement today. Could you explain how the asset vault business relates to the current business and how the $100,000,000 of EBITDA on the asset portfolio fits in? You mentioned additional cash flow streams accruing to the holding company. Can you just walk through that for us in that the market cap is still well below $300,000,000 you’re talking about $100,000,000 of EBITDA.

Is this a do you think you’re talking about additional revenue and margin for you guys?

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: Sure. Yes, you were breaking up a little bit. I think got the gist of it. By the way, it’s a great question. And in the announcement, did spend, I think, a few cents on it.

But I’m glad you asked it, because I’ll spend a little bit of time on it. The $100,000,000 of EBITDA we mentioned specifically to the projects that are in development now, that this 300,000,000 is targeted at delivering. That’s specific to Asset Vault and our own and operate portfolio. So, first point is, as you sort of asked or insinuating your question, that is a piece of Energy Vault’s business. So, that is and would be complementary to our energy storage solutions business, which are some of the projects we’re executing today in Australia, the one for consumers energy, for example, that we announced that’s starting deliveries in Q4, where we’re delivering systems and doing the commissioning and then doing long term service agreements.

The asset vault, that $100,000,000 on this first set of projects that are getting funded is in addition to what would continue to be our synergistic energy storage solutions business. So, that’s number one. I think the other question you asked, as I understood it, if I heard you right, is how does that relate back into energy? Well, how does the asset bulk business relate back in? And there’s incremental cash and margin streams that do go back into the parent.

And that’s related to the fact that Asset Vault is going to contract to Energy Vault. So, Energy Vault will be building these projects. And while there’s a revenue elimination there, because it becomes intercompany on the revenue side, there’s obviously margins associated with the building of the project. So, let’s say the EPC agreement to go and build the project, there’s margins associated with the long term service agreements that have to be done and put in place to be able to monitor these. And those are nice agreements too, 30% to 40% type of margins on those.

And then there’s a piece that’s just related to the management fee and expenses in and around the management of that portfolio that Energy Vault is doing. So, those would be additional streams that in addition to that, let’s call it the asset vault EBITDA that would flow back into and essentially bring additional cash flows into Energy Vault. So, there’s a few different pieces there that as you get a sense of are all enhancing the cash flow and liquidity and streams at the parent co level. Does that answer your questions?

Michael Renoff, Analyst, Skoggan Capital: Yeah, that’s super helpful. And then just on Stony Creek, I saw the announcement on completing there. I know it was expected, but it’s been a formalized. That part is bigger than the others. Can you just talk about the timeline to get that built in an operation and then what other things you have going on in Australia?

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: Sure. Stoney Creek, as mentioned, is gonna be our largest one in the portfolio now going in. And in that this close now, what we have going forward is the next step in real large milestone is what’s called the DA or the design approval. And that essentially is focused on the final land permitting process. There’s already been the environmental studies and reports.

So, all of the major items clearing out, I think any risks around the site that we’ve chosen, environmental aspects, any aspects related to, I think some of the other indigenous requirements there and other management things were gonna be essentially done into this DA approval, this final design approval. We expect that sometime by the end of the year or into Q1. So, it’s going to be right in that range. And then from there, we’re really at that, concurrently while we’re doing that, we’ll be getting project financing. So, in this next, let’s call it the next four to five months, while we’re getting the DA approval, we’re gonna start a project financing process.

Just to remind you and everybody, we have what’s called an El Tessa, a long term energy service agreement there issued through AMO and the New South Wales government. So that we have that off taker there already. So that should give I think a very good confidence to all of us around the ability to get that asset financed. So, that figure in some case, all of that comes together in Q1 next year, and then it achieves what’s called ready to build or RTB status. And we will have done the EPC contract back into Energy Vault with Asset Vault, also in parallel this next four to five months.

So then we’re really ready to hit construction, order all key long lead items, and start building it through the year, essentially of ’26, into what’s expected to be an early twenty seven, essentially COD or operations of the project.

Michael Renoff, Analyst, Skoggan Capital: Got it, appreciate it. Thank you.

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: Okay, thank you.

Conference Call Operator: And this does conclude the Q and A session of today’s program. I’d now like to turn the program back over to Robert Picone for any closing remarks.

Robert Picone, Chairman and Chief Executive Officer, Energy Vault: Okay. Operator, thank you. And I want to thank again everybody who joined the call here. We encourage everybody to go to the announcement, but also we included a deck presentation as usual that’s on the website under the investor section that includes some of the details and to some of the questions here that hopefully will be useful to everyone. In closing, as you get the sense of, we’re really excited, I think now as a company to essentially have access now, as we’re gonna get this, what’s just been announced this morning preferred on equity to get that closed, and then be putting that capital to work toward our development portfolio, and really continuing to focus on executing on that now without being involved in capital raise processes, etcetera.

That’s a very good position to be in, I think as a company. And I think from an investor perspective, reduces tremendously a lot of the risks that people may have had in their minds. We’re expecting to see a lot of the benefits come forward now as we start putting the capital to work.

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