Q1 2025 Solid Power Inc Earnings Call

Good day, and welcome to the Solid Power's first quarter 2025 earnings conference call. All participants will be in a listen only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.

After today's presentation, there will be an opportunity to ask questions.

To ask a question, you may press star, then one, on the touchtone phone.

To withdraw your question, please press star, then two

Please note, this event is being recorded.

Speaker Change: I would now like to turn the conference over to Melanie Solomon, investor relations. Please go ahead.

Speaker Change: 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 Ben Scoter, and chief financial officer, Linda Heller.

Speaker Change: A copy of today's earnings release is available on the Invest Relations section of Solid Power's website, www.SolidPowerFattery.com.

Speaker Change: I'd like to remind you that parts for discussion today will include forlooking statements as defined by US security's laws. These forlooking 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.

Speaker Change: Except those otherwise required by applicable law, Solid Power disclaims any duty to update any forward-looking statements to reflect future events or circumstances.

Speaker Change: For a discussion of the risks and uncertainties that could cause actual results different materially from those expressed in today's four-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.cellupowerbattery.com

Speaker Change: With that, let me turn it over to John Banskotter [inaudible]

Thank you, Melanie, and thank you all for joining us.

2025 is off to a good start.

Speaker Change: I'm pleased to leave off with our first operational goal for 2025.

Continuing to execute on our Electrolite Development Roadmap.

Speaker Change: As a reminder, we're currently planning to install the first, globally known, continuous manufacturing pilot line for sulfide electrolyte production at SP2, which we expect will expand our production capacity to 75 metric tons per year.

Speaker Change: This project is designed to support anticipated small volume programs of current and future customers as they begin to transition from traditional lithium ions to solid state battery

Speaker Change: During the quarter, we conducted detailed design of equipment for the new line and we received $1.5 million reimbursements under our agreement with the U.S. Department of Energy.

Speaker Change: We look forward to beginning facility engineering in the coming months and remain on track for commissioning of a lie in 2026.

Speaker Change: Our next co-projective for this year is to continue to execute our agreements with SKN.

Speaker Change: which supports SKN'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.

Speaker Change: We're close to completing our factory acceptance testing for the S.K. Online.

Speaker Change: which is a key milestone on our Line Installation Agreement with S.K.I.

Speaker Change: We expect to move to site acceptance testing of the line at S.G.Anne later this year.

Speaker Change: Our third corporate objective for 2025 is focusing on driving, electrolyte innovation and performance through feedback from internal cell development and customers.

Speaker Change: We continue to receive constructive feedback from customers that have sampled our electrolyte.

Speaker Change: This feedback is driving process engineering which we expect will lead to improved electrolyte performance

Electrolite Innovation Center, or EIC.

Speaker Change: 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.

Speaker Change: at the smaller scale before transferring those learnings to our pilot electrolyte manufacturing lines.

Speaker Change: Our fourth corporate objective is to ramp electrolyte sampling and identify long-term customers.

Speaker Change: 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.

Speaker Change: We are encouraged by our customer engagement and electrolyte sampling activities.

and remain confident in the promise of sulfide-based solid state batteries.

Speaker Change: I'll now turn it over to Linda to discuss our financial results and progress towards achieving our financial discipline goal. Linda?

Linda Heller: Thank you, John . I'll start with Q1 results beginning with Revenue.

Speaker Change: During the first quarter of 2025, we generated revenue of $6 million for the end of the year.

Compared to our revenue of $5.9 million dollars.

Speaker Change: during the first quarter of 2024. Revenue recognized this quarter was driven primarily by the SK on agreement and execution of milestones within the line installation agreement.

Speaker Change: Operating expenses were $30 million for the quarter, a decrease of $1.7 million compared to the first quarter of 2024. This decrease was driven by a lower direct labor cost necessary to execute on the milestones within our collaborative arrangement.

Speaker Change: Operating locks with $24 million and that locks with $50 million or $8 cents per share.

Speaker Change: Capital expenditure is total $2.4 million, primarily representing cost for the construction of our continuous electro-like production pilot line.

Speaker Change: Turning to our balance sheet and liquidity during the quarter, we invested $26.3 million into operations and $2.4 million into CAPF, bringing our total cash investment to $28.7 million.

Speaker Change: We ended the quarter with total liquidity of $300 million as of March 31st, 2025.

Speaker Change: In addition, contract receivable total $2.2 million and total current liabilities or $10.4 million.

Speaker Change: Final corporate objective for this year is to remain fiscally just one balancing financial discipline with appropriate and vastness in technology development and cost of improvement. We remain on track to achieve this objective.

John: I will now turn it back to John for some final thoughts [inaudible]

John: Thank you, Linda. In closing, we continue to make progress towards achieving our 2025 objectives.

John: I would like to thank our employees, partners and stakeholders for their loyalty and dedication.

John: I'm excited about our opportunity to generate a strong shareholder return.

We'll now take your questions.

Operator?

Speaker Change: We will now begin the question and answer session. To ask a question you may press star than one on your touch tone phone.

Speaker Change: If at any time your question has been addressed and you would like to withdraw your question, please press star then two

Speaker Change: At this time, we will pause momentarily to assemble our roster.

Speaker Change: The first question today comes from Chris Pierce with Needham. Please go ahead.

Hey, good afternoon. How's everybody doing?

Good, Chris. Good to hear your voice.

Speaker Change: Could you, could you just remind us sort of how to think about 25 revenue and then how should we think about a stepop or, you know...

Revenue from Customers [inaudible]

Speaker Change: I guess, you know, not firm guidance, but some sort of timing around revenue from, you know, customers for the electrolytes and how should we think about, you know, revenue per vehicle, you know, just kind of some broad brush jokes would be great.

Speaker Change: effort to be put in in 25. So that is one, we also have some government contracts which those are also

Speaker Change: We look more for repeat sampling and increased size sampling is how we look at our revenue and determine our attraction as well as our customer feedback.

Yeah, so on that, but I guess-

Speaker Change: You know, I should ask the question a little better, I apologize, but if we think about repeat sampling and moving towards former orders and things like that, I guess what's the right way to think what's the trajectory of revenues potentially beyond 25. And again, I'm not looking for a number but just like just any sort of framework reference to think about how things could move forward whether it's how we think about EV adoption or just broadly. [inaudible]

So Chris R.

Customers are in the early stages of their cell development.

Speaker Change: And that's what's driving the sampling so it's not large quantities compared to where we will end up.

It is increasing, no, and quite substantially that started at the back half of last year and it continues this year.

Speaker Change: 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, 2028, but the bulk of them are around 2030 and beyond.

Speaker Change: So, we have seen increased revenues, but not substantially given the work that is still required on the cell level.

Speaker Change: Okay, perfect. And just lastly, for me, I know you talked about government revenue and job. I think you said something in your remarks, but I just want to, can we drill down a little bit on the EOE loan? I just kind of what the latest update is there.

Speaker Change: Hi, Chris, it's Linda again. Let me first clarify, it is not alone, it is a grant.

Speaker Change: So there is a difference there. And we, as John mentioned, we did receive one and a half million in funds during Q1 under that grant.

At this point, that's really all we can tell you.

Okay, perfect. Thank you.

Speaker Change: As a reminder, if you would like to ask a question, please press star then one to join the question queue.

Let's start at one to join the question, Q.

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

Speaker Change: Linda and I look forward to updating you again next quarter.

Thank you