Earnings call transcript: Solid Power reports Q1 2025 results with slight revenue growth

Solid Power Inc. (SLDP) released its first-quarter 2025 financial results, reporting revenue of $6 million, a modest increase from the previous year’s $5.9 million. The company’s earnings per share (EPS) stood at a loss of 8 cents, surpassing the forecasted loss of 10 cents. Despite the earnings beat, the company’s revenue fell short of the $10.8 million forecast. With a market capitalization of $208 million, Solid Power maintains a strong balance sheet, holding more cash than debt. Following the earnings announcement, Solid Power’s stock remained stable in after-hours trading, closing at $1.13, with a negligible decrease of 0.01%.

According to InvestingPro, there are 10+ additional investment insights available for Solid Power, including detailed analysis of its financial health and growth prospects.

Key Takeaways

• Solid Power’s Q1 2025 revenue increased slightly year-over-year.
• EPS loss was smaller than expected, indicating better cost management.
• After-hours stock price remained relatively unchanged.
• The company is advancing its solid-state battery technology and production capabilities.
• Significant revenue from electrolyte sales is anticipated between 2027 and 2030.

Company Performance

Solid Power’s financial performance in Q1 2025 showed resilience, with a slight increase in revenue compared to Q1 2024. The company continues to focus on developing its solid-state battery technology, which remains in the early stages of market development. Solid Power’s partnerships with SK ON and the U.S. Department of Energy underscore its strategic positioning in the competitive landscape.

Financial Highlights

• Revenue: $6 million, up from $5.9 million in Q1 2024.
• Operating Expenses: $30 million, reduced by $1.7 million.
• Net Loss: $15 million, translating to an EPS of -8 cents.
• Total Liquidity: $300 million as of March 31, 2025.
• Capital Expenditures: $2.4 million, primarily for pilot line development.

Earnings vs. Forecast

Solid Power’s actual EPS of -0.08 exceeded the forecasted -0.10, marking a 20% positive surprise. However, revenue fell short of expectations, coming in at $6 million against a forecast of $10.8 million. This mixed performance highlights the company’s ongoing challenges in scaling its operations and achieving projected sales.

Market Reaction

Following the earnings release, Solid Power’s stock price remained stable in aftermarket trading, closing at $1.13. This stability suggests that investors were not significantly swayed by the earnings surprise or revenue miss. The stock’s performance aligns with broader market trends, where investors remain cautious amid economic uncertainties.

Outlook & Guidance

Solid Power is focusing on expanding its production capacity, with plans to commission its first continuous manufacturing pilot line by 2026. The company anticipates increased electrolyte sampling and customer engagement in the coming quarters. Long-term revenue growth is expected from electrolyte sales, projected to become significant between 2027 and 2030.

Executive Commentary

CEO John Van Scooter expressed optimism about customer engagement and the company’s progress in electrolyte sampling. He noted, "We are encouraged by our customer engagement and electrolyte sampling activities." CFO Linda Heller reaffirmed the company’s commitment to its strategic objectives, stating, "We remain on track to achieve this objective."

Risks and Challenges

• Market Saturation: The solid-state battery market is still emerging, and competition is intensifying.
• Supply Chain Issues: Potential disruptions could impact production timelines and costs.
• Economic Pressures: Broader economic conditions may affect customer demand and investment capabilities.
• Technological Challenges: Advancements in battery technology require substantial R&D investments.
• Regulatory Changes: Shifts in government policies could influence market dynamics and funding opportunities.

Q&A

During the earnings call, analysts inquired about the company’s revenue sources for 2025, which include collaborations with SK ON, government contracts, and limited electrolyte sampling. Solid Power received $1.5 million in DOE grant funds in Q1, and management reiterated expectations for significant revenue growth from 2027 onward.

Full transcript - Solid Power Inc (SLDP) Q1 2025:

Conference Operator: Please note this event is being recorded. I would now like to turn the conference over to Melanie Solomon, Investor Relations. Please go ahead.

Melanie Solomon, Investor Relations, Solid Power: Thank you, operator. Welcome, everyone, and thank you for joining us today. I’m joined on today’s call by Solid Power’s President and Chief Executive Officer, John Van Scooter and Chief Financial Officer, Linda Heller. A copy of today’s earnings release is available on the Investor Relations section of Solid Power’s website, www.solidpowerbattery.com. I’d like to remind you that parts of our discussion today will include forward looking statements as defined by U.

Securities laws. These forward looking statements are based on management’s current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, Solid Power disclaims any duty to update any forward looking statements to reflect future events or circumstances. For a discussion of the risks and uncertainties that could cause actual results to differ materially from those expressed in today’s forward looking statements, please see Solid Power’s most recent filings with the Securities and Exchange Commission, which can be found on the company’s website at www.solidpowerbattery.com. With that, let me turn it over to John VanSchroeder.

John Van Scooter, President and Chief Executive Officer, Solid Power: Thank you, Melanie, and thank you all for joining us. 2025 is off to a good start. I’m pleased to lead off with our first operational goal for 2025, continuing to execute on our electrolyte development roadmap. As a reminder, we’re currently planning to install the first globally known continuous manufacturing pilot line production at SP2, which we expect will expand our production capacity to 75 metric tons per year. This project is designed to support anticipated small volume programs of current and future customers as they begin to transition from traditional lithium ion to solid state battery technology.

During the quarter, we conducted detailed design of equipment for the new line and we received $1,500,000 in reimbursements under our agreement with the U. S. Department of Energy. We look forward to beginning facility engineering in the coming months and remain on track for commissioning of the line in 2026. Our next corporate objective for this year is to continue to execute our agreements with Eskayon, which support Eskayon’s efforts to develop solid state cells based on our technology and operate a solid state pilot line that we designed to use our electrolyte.

We’re close to completing our factory acceptance testing for the SK ON line, which is a key milestone under our line installation agreement with SK On. We expect to move to site acceptance testing of the line at SK On later this year. Our third corporate objective for 2025 is focusing on driving electrolyte innovation and performance through feedback from internal cell development and customers. We continue to receive constructive feedback from customers that have sampled our electrolyte. This feedback is driving process engineering, which we expect will lead to improved electrolyte performance.

During the quarter, we also continued innovating in our state of the art Electrolyte Innovation Center or EIC. After commissioning the EIC last year, we’ve been eager to take advantage of its capabilities. We’re using the EIC to develop and test production processes at the smaller scale before transferring those learnings to our pilot electrolyte manufacturing lines. Our fourth corporate objective is to ramp electrolyte sampling and identify long term customers. During the first part of this year, we have continued to see demand for multiple generations of our electrolyte from customers, including both existing and potential new customers.

We are encouraged by our customer engagement and electrolyte sampling activities and remain confident in the promise of sulfide based solid state batteries. I’ll now turn it over to Linda to discuss our financial results and progress towards achieving our financial discipline goal. Linda?

Linda Heller, Chief Financial Officer, Solid Power: Thank you, John. I’ll start with Q1 results beginning with revenue. During the first quarter of twenty twenty five, we generated revenue of $6,000,000 compared to our revenue of $5,900,000 during the first quarter of twenty twenty four. Revenue recognized this quarter was driven primarily by the SK On agreement and execution of milestones within the line installation agreement. Operating expenses were $30,000,000 for the quarter, a decrease of $1,700,000 compared to the first quarter of twenty twenty four.

This decrease was driven by a lower direct labor cost necessary to execute on the milestones within our collaborative arrangement. Operating loss was $24,000,000, and net loss was $15,000,000 or 8¢ per share. Capital expenditures totaled $2,400,000, primarily representing costs for the construction of our continuous electrolyte production pilot line. Turning to our balance sheet and liquidity during the quarter, we invested $26,300,000 into operations and $2,400,000 into CapEx, bringing our total cash investment to $28,700,000. We ended the quarter with total liquidity of $300,000,000 as of 03/31/2025.

In addition, contract receivables totaled $2,200,000 and total current liabilities were $10,400,000. Final corporate objective for this year is to remain fiscally disciplined, balancing financial discipline with appropriate investments in technology development and process improvement. We remain on track to achieve this objective. I will now turn it back to John for some final thoughts.

John Van Scooter, President and Chief Executive Officer, Solid Power: Thank you, Linda. In closing, we continue to make progress towards achieving our 2025 objectives. I would like to thank our employees, partners and stakeholders for their loyalty and dedication. I’m excited about our opportunity to generate a strong shareholder return. We’ll now take your questions.

Operator?

Conference Operator: We will now begin the question and answer session. First question today comes from Chris Pearce with Needham. Please go ahead.

Chris Pearce, Analyst, Needham: Hey, good afternoon. How is everybody doing? Good, Chris. Good to hear your voice. Could you just remind us sort of how to think about ’25 revenue?

And then how should we think about a step up or revenue from customers? I guess not firm guidance, but some sort of timing around revenue from customers for the electrolytes and how should we think about revenue per vehicle? Just kind of some broad brush strokes would be great.

Linda Heller, Chief Financial Officer, Solid Power: Hi Chris, it’s Linda. Let me take a stab at answering this. Twenty five revenue is really dominated by two items, the substantial majority and they’re related to collaborative arrangements. SK On is clearly the largest collaborative arrangement and clearly the most effort being put in in ’twenty five. So that is one.

We also have some government contracts which those are also in our revenue base. And then we have our electrolyte sampling. And sampling is at a much lower level than revenue per car or anything like that. So we don’t break it out on that. We look more for repeat sampling and increased size sampling is how we look at our revenue and determine our traction as well as our customer feedback.

Chris Pearce, Analyst, Needham: Yeah. So on that, I guess, you know, I should have asked the question a little better. I apologize. But if we think about repeat sampling and moving towards firmer orders and things like that, I guess, what’s the right way to think about the trajectory of revenues potentially beyond ’25? And again, I’m not looking for a number, I just like just any sort of frame of reference to think about how things could move forward, whether it’s how we think about EV adoption or just broadly.

John Van Scooter, President and Chief Executive Officer, Solid Power: So, Chris, our customers are in the early stages of their cell development, and that’s what’s driving the sampling. So it’s not large quantities compared to where we will end up. It is increasing though, and quite substantially. That started in the back half of last year and it continues this year. So that’s really what I can say at this point.

We’ve talked about timings for significant electrolyte revenue in the past, as you know. We have a wide range of customers, potentially as early as 2027, ’20 ’20 ’8, but the bulk of them are around 02/1930 and beyond. So we have seen increased revenues, but not substantially given the work that is still required on the cell level.

Chris Pearce, Analyst, Needham: Okay. Perfect. And just lastly for me, I know you talked about government revenue. And John, I think you said something in your remarks, but I just want to can we drill down a little bit on the DOE loan? Just kind of what the latest update is there.

Linda Heller, Chief Financial Officer, Solid Power: Hi, Chris. It’s Linda again. Let me first clarify, it is not a loan. It is a grant. So there is a difference there.

And as John mentioned, we did receive $1,500,000 funds during Q1 under that grant. And at this point, that’s really all we can tell you.

Chris Pearce, Analyst, Needham: Okay, perfect. Thank you.

Conference Operator: This concludes our question and answer session. I would like to turn the conference back over for any closing remarks.

John Van Scooter, President and Chief Executive Officer, Solid Power: Thank you for joining the call today and for your interest in Solid Power. Linda and I look forward to updating you again next quarter. Thank you.

Conference Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.

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