Q1 2025 Nuvve Holding Corp Earnings Call
Operator: Good morning and welcome to the Nuvve Holding Corporation first quarter 2025 earnings conference call.
Good morning, and welcome to the New way holding Corporation first quarter 2025 earnings Conference call.
Operator: On today's call are Greg Poilasne, Chief Executive Officer, and David Robson, Chief Financial Officer of Nuvve Holding.
Speaker Change: On today's call are Gregg <unk>, Chief Executive Officer, and David Robson, Chief Financial Officer of <unk>.
Operator: Nuvve Earlier today, Nuvve issued a press release announcing its first quarter 2025 results. Following prepared remarks, we will open up the call for questions.
You bet.
Earlier today.
Speaker Change: <unk> issued a press release announcing its first quarter 2025 results. Following prepared remarks, we will open up the call for questions.
Operator: before we begin. I would like to remind you that this call may contain forward-looking statements. While these forward-looking statements reflect Nuvve's best current judgment, they are subject to risks and uncertainties that could cause actual results to differ materially from those implied by these forward-looking projections. These risk factors are discussed in Nuvve's filing with the SEC and in the earnings release issued today, which are available on our website. Nuvve undertakes no obligation to revise or update any forward-looking statements to reflect future events or circumstances. Please note, this event is being recorded.
Speaker Change: Before we begin.
Speaker Change: I would like to remind you that this call may contain forward looking statements. While these forward looking statements reflect <unk>.
<unk> best current judgment, they are subject to risks and uncertainties that could cause actual results to differ materially from those implied by these forward looking projections. These risk factors are discussed in these days.
Speaker Change: <unk> with the SEC and in the earnings release issued today, which are available on our website.
Speaker Change: <unk> undertakes no obligation to revise or update any forward looking statements to reflect future events or circumstances.
Speaker Change: Please note this event is being recorded.
Gregory Poilasne: With that, I would like to turn the call over to Greg Poilasne, Chief Executive Officer of Nuvve. Gregory? Thank you. And good afternoon to everyone here today.
Greg: With that I would like to turn the call over to Greg <unk>, Chief Executive Officer of New Vision Gregory.
Greg: Thank you and good afternoon to everyone here today welcome to our Q1 'twenty five results call. This.
Gregory Poilasne: Welcome to our Q1 2025 results call. This quarter has been a good transition quarter. Though our top-line revenue for the quarter is not yet where we want, we are in a much better position than Q1 2024. We have received 28 orders for new charging stations versus only one a year ago. Our backlog is growing, but our revenue recognition slowed as we transitioned to a drop-ship model with our new partner, TELUS PowerGreen, that we announced in January. The caller and the first half of Q2 have been reached in action. In February, Nuvve was awarded a critical contract with the state of New Mexico.
Greg: This quarter has been a good transition card do our topline revenue for the quarter is not yet where we work we are in a much better position than Q1 'twenty. Four we have received 28 orders for new charging station.
Greg: One a year ago.
Greg: Backlog is growing but our revenue recognition slowed as we transition to.
Drop ship model with our new partner <unk> powered green that we announced in January.
Greg: The quarter and the first half of Q2 have been reached in action.
Greg: In February <unk> was awarded a critical contract with the state of New Mexico.
Gregory Poilasne: This framework agreement allows us to provide proposals to any governmental EV deployment, either with school districts, municipalities, or state organizations, without going through an RFP process. Its infrastructure deployments including charging station, solar, storage, and microgrid implementation will be financed for the state of New Mexico by our partner, JFRE. This project represents a potential opportunity greater than $400 million of CapEx deployment over the next four years.
Greg: Framework agreement allows us to provide proposal to any governmental easy deployment, either with school districts municipalities or state organization without going through an RFP process.
Greg: Is it infrastructure deployments, including charging station solar storage and Microgrid implementation will be finance.
Speaker Change: So all of the state of New Mexico by Air Partners Jefferies.
Speaker Change: <unk> represents a potential opportunity would be greater than $400 million of capex deployment over the next four years.
Gregory Poilasne: In order to successfully support this opportunity, we have established a special company in the state of New Mexico named Nuvve New Mexico. The purpose of this LLC is to develop close ties with key stakeholders in the state. Ted Smith, our former Chief Operating Officer, has been named CEO of Nuvve New Mexico. He is our champion and will bring any component from Nuvve in order to successfully support the state. We have also decided to open some of the capital of New Guinea, Mexico to local investors in order to align interest. I'm looking forward to showing more of our progress in the state of New Mexico.
Speaker Change: In order to successfully support this opportunity we've had established a special company in the state of New Mexico and name moving into Mexico.
Speaker Change: The purpose of this LLC is to develop close ties with key stakeholders in the states pits myths, our former Chief operating officer has been named CEO of <unk>, New Mexico. These are a champion and we bring any component for from duty in order to successfully support the state we have also decided to.
Speaker Change: And some of the capital of <unk>, New Mexico to local investors in all that.
Speaker Change: To align interest.
Speaker Change: Looking forward to sharing more of our progress in the state of New Mexico soon.
Gregory Poilasne: Moving on to Japan, after many years of managing batteries for Chubu Electric in collaboration with Toyota Toshio, we have decided to move on and create a new entity that will drive the energy storage business in Japan on its own. Nuvve Japan is now established and we have brought on board Masa Iigashida to lead our operations in Japan. This new company is initially focused on stationary storage deployment monetization. with new deregulation in 2026, supporting the aggregation of distributed storage in order to participate across a variety of energy markets. We are very bullish on the Japanese market, and we are convinced that we are doing this transition at the right time.
Speaker Change: Moving onto Japan. After many years of managing batteries for Chubu electric in collaboration with third up to show, we have decided to move on and create a new entity that will drive the energy storage business in Japan on its own.
Speaker Change: <unk>, Japan is notwithstanding and we have brought onboard Mustang gas you got to lead our operations in Japan.
Speaker Change: This new company is initially focused on stationary storage deployment monetization.
Speaker Change: We have new designation in 2026 supporting degradation of distributed storage in order to participate across a variety of energy markets.
Speaker Change: We are very bullish on the Japanese market and we are convinced that we are doing this transition at the right time.
Gregory Poilasne: In order to support and accelerate the development of Nuvve Japan, we have also made the decision to appoint a minority of the capital to local investors. This process is well underway, and we'll share more information as it becomes available.
Speaker Change: In order to support the Nx generically they plant the development of Navy Japan. We have also made the decision to appoint a minority of the capital to local investors.
Speaker Change: Process is well underway and we will share more information as it becomes available.
Gregory Poilasne: Later in the quarter, we also announced our battery-as-a-service model for Electric Cooperative, and we welcome Michael Smucker as our energy storage sales leader.
Speaker Change: Later in the quarter, we also announced our battery as a service model for electric cooperative and we welcome Michael Smoker as our energy storage sales either.
Gregory Poilasne: We believe that the problem of grid modernization needs to be resolved between substation and the end customer.
Speaker Change: We believe that the problem of grid monetization to be resolved between substation MDM customers.
Gregory Poilasne: At the end of the quarter, we made two important announcements.
Speaker Change: At the end of the call her we made two important announcements.
Gregory Poilasne: First, in late April, we announced the acquisition of the assets of Fermata Energy into Fermata 2.0 with 100% of the common shares owned by Nuvve. We made this decision based on a few key elements. First, we felt that Fermata focused I've been focusing, sorry, on behind-the-meter value extraction. The Fermata platform tool stack was very advanced also. Toycon Thermador has developed a solid relationship with vehicle manufacturers, an area where Nuvve has been less focused. We have been able to execute this acquisition without any cash coming from the Nuvve Holding balance sheet, while acquiring a mature pipeline allowing for expanded long-term opportunities.
Speaker Change: First in late April we announced the acquisition of the assets a fair amount of energy into fair amount of $2 <unk> with 100% of the common shares owned by <unk>.
Speaker Change: We made this decision based on a few key elements first we felt that we felt that tomorrow focus.
Speaker Change: I've been focusing on.
Speaker Change: Behind the meter value extraction, the permitted platform tool stack was very advanced also.
Speaker Change: Click on Thermodox, they've up solid relationship with vehicle manufacturers, an area, where a movie has been less focused.
Speaker Change: We have been able to execute this acquisition without any cash coming from the new beholding balance sheet, while requiring a much bigger pipeline, allowing for expanded long term opportunities.
Gregory Poilasne: We're very excited about the future of Fermata under Nuvve Umbrella, which provides us the opportunity to consolidate software development resources.
Speaker Change: We're very excited about the future of fair amount of under movie umbrella, which provides us the opportunity to consolidate software development resources.
Gregory Poilasne: Finally, in late April, Nuvve also announced the creation of a new subsidiary in order to address another distributed asset management Digital Asset. This effort, led by James Altershaw and supported by Tim Collins and me, is focusing on building a diversified portfolio of cryptocurrency. The Digital Asset Management Committee is going to oversee the portfolio distribution by targeting multiple picks and shovels tokens from high-growth sectors such as decentralized finance, DeFi, decentralized physical infrastructure, Deepin, programming, and tokenization of real-world assets.
Speaker Change: Finally in late April movie also announced the creation of a new subsidiary in order to address another distribute your asset management business digital assets.
Speaker Change: Led by James out there sure and supported by a team calling to me is focusing on building a diversified portfolio of cryptocurrency.
Speaker Change: The digital asset management committee is going to oversee the portfolio distribution by targeting multiple picks and shovels tuck ins from high growth sectors, such as centralized finance defy decentralized physical infrastructure deep in programming and took organization of railroad assets.
Gregory Poilasne: In summary, this quarter carries the fruit of many quarters of hard work to transform Nuvve, reducing our cash burn at the holding level and focusing the organization on profitability. This transformation is well underway, and we are very excited about the future.
Speaker Change: In summary, these quota carriers, the food or many quarters of hard work to transform newbie, reducing our cash burn at the holding level and focusing the organization on profitability.
Speaker Change: Transformation is well underway and we are very excited about the future.
David Robson: And now, I will let David take you through the details of our financial... Thanks, Gregory. I will start with a recap of first quarter 2025 results. In the first quarter, we generated total revenues of $0.9 million compared to $0.8 million in the first quarter of 2024. The growth was primarily driven by increased charger hardware sales versus the same period last year. Margins on products, services, and grant revenues were 39.9% for the first quarter of 2025 compared to 34.7% for the year-ago period. The increase is primarily due to a higher mix of service revenues this quarter compared to last year.
And now I will let David take you through the details of our financials.
David Robson: Thanks, Gregory I will start with a recap of first quarter 2025 results in the first quarter. We generated total revenues of <unk> 9 million compared to $8 million in the first quarter of 2024. The growth was primarily driven by increased charge or hardware sales.
Speaker Change: Versus the same period last year.
Speaker Change: Margins on products services and grant revenues were 39, 9% for the first quarter of 2025 compared to 34, 7% for the year ago period. The increase is primarily due to a higher mix of service revenues this quarter compared with last year.
David Robson: Including grant revenues, margins on product and service revenues were 32.6% for the first quarter of 2025, compared to 26.8% in the current year-ago period. As a reminder, margins can be lumpy from quarter to quarter, depending on the mix. DC charger gross margins at standard pricing generally range from 15 percent to 25 percent, while AC charger gross margins are approximately 50 percent, but in dollar terms are a small fraction of the revenue of the DC charger. Grid service revenue margins are generally 30 percent, while software and engineering service margins are as high as 100. Operating costs, excluding cost of sales, was $6 million for the first quarter of 2025 compared to $5.9 million for the fourth quarter of 2024 and $7.5 million for the first quarter of 2024.
Speaker Change: Excluding grant revenues margins on product and service revenues were 32, 6% for the first quarter of 2025 compared to 26, 8% in the current year ago period.
Speaker Change: As a reminder, margins can be lumpy from quarter to quarter, depending on the mix do you see chart here gross margin standard pricing.
Speaker Change: Generally range from 15% to 25% while AC charger gross margins are approximately 50%, but in dollar terms are a small fraction of the revenue of the DC Charger grid service revenue margins are generally 30%, while software and engineering service margins are as high as 100.
Speaker Change: Percent.
Speaker Change: Operating costs, excluding cost of sales was $6 million for the first quarter of 2025 compared to $5 9 million for the fourth quarter of 2024, and $7 5 million for the first quarter of 2020 core.
David Robson: We have continued to drive efficiencies in 2025, resulting in lower overhead We expect the lower operating costs we have realized this quarter compared to the prior year first quarter to continue in future quarters. Cash operating expenses, excluding cost of sales, stock compensation, and depreciation and amortization expense, was $5.3 million in the first quarter of 2025 versus $5.2 million in the fourth quarter of 2024 versus $6.6 million in the first quarter of 2024. This represents a client of $1.3 million in expenses over the same quarter last year. Other expense was $1.3 million in the first quarter of 2025 compared to $0.5 million of other income in the first quarter of 2024.
Speaker Change: We are continuing to drive efficiencies in 2025, resulting in lower overhead costs, we expect the lower operating costs, we have realized this quarter compared to the prior year first quarter to continue in future quarters.
Speaker Change: Cash operating expenses, excluding cost of sales stock compensation and depreciation and amortization expense was $5 3 million in the first quarter 2025 versus $5 2 million in the fourth quarter of 2020 or versus $6 6 million in the first quarter of.
Speaker Change: 2024.
Speaker Change: This represents a decline of $1 3 million in expenses over the same quarter last year.
Speaker Change: Other expense was $1 3 million in the first quarter of 2025 compared to <unk> 5 million of other income in the first quarter of 2024.
David Robson: The prior year period benefited from non-cash gains from the change in the fair value of a warrants, while the current period had non-cash losses from the change in the fair value of convertible debt and warrants, in addition to interest expense from borrowing.
Speaker Change: The prior year period benefited from noncash gain from the change in fair value of warrants, while the current period had noncash losses from the change in the fair value of the convertible debt and warrants. In addition to interest expense from borrowings.
David Robson: Net loss attributable. to Nuvve Common Stockholders decreased in the first quarter of 2025 to $6.9 million from a net loss of $7 million in Q1 of 2024. The improvement was primarily a result of lower operating expenses offset by higher non-operating expenses.
Speaker Change: Net loss attributable.
Two newly common stockholders decreased in the first quarter of 2025 to $6 9 million from a net loss of $7 million in Q1 2024.
Speaker Change: The improvement was primarily a result of lower operating expenses offset by higher non operating expenses.
David Robson: Now, turning to our balance sheet, we had approximately $1.2 million in cash as of March 31, 2025, excluding $0.3 million in restricted cash, which represents an increase of $0.8 million from December 2024. The increase was a result of capital raised through the issuance of common stock and the exercise of warrants, totaling $1.4 million, and an increase in net borrowings of $1.2 For more information visit www.FEMA.gov primarily offset by $1.8 million used in operating equity. During the quarter, inventory decreased by $25 million to $4.1 million at March 31, 2025, as we continue to improve our inventory turnover.
Speaker Change: Now turning to our balance sheet, we had approximately $1 2 million in cash as of March 31, 2025, excluding $3 million in restricted cash, which represents an increase of <unk> 8 million from December 2024. The increase was a result of capital raised.
Speaker Change: The issuance of common stock.
Speaker Change: And the exercise of warrants totaling $1 4 million and an increase in net borrowings of $1 $2 million, primarily offset by $1 8 million used in operating activities.
Speaker Change: During the quarter inventory decreased by <unk> 5 million to $4 1 million at March 31, 2025, as we continue to improve our inventory turnover.
David Robson: During the quarter, accounts receivable decreased by $0.7 million to $1.5 million on March 31, 2025. due to improved collections of our customer balance. Accounts payable at the end of the first quarter of 2025 was $2.2 million, an increase of $0.3 million compared to the fourth quarter of 2024 of $1.9 million. Accrued expenses at the end of the first quarter of 2025 was $4.8 million, an increase of $1.4 million compared to the fourth quarter of 2024 of $3.4 million.
Speaker Change: During the quarter accounts receivable decreased $5 7 million to $1 5 million at March 31, 2025.
Speaker Change: Due to improved collections of our customer balances.
Speaker Change: Accounts payable at the end of the first quarter of 2025 was $2 2 million, an increase of $3 million compared to the fourth quarter of 2024 of $1 9 billion.
Speaker Change: Accrued expenses at the end of the first quarter of 2025 was $4 8 million, an increase of $1 4 million compared to the fourth quarter of 2024 of $3 4 million.
David Robson: Now, turning to our megawatts under management and estimated future grid service revenues. As a reminder, megawatts under management is a metric we use to quantify the aggregated amount of electrical capacity from the deployment of our V1G and V2G chargers, which are primarily deployed in the electric school bus market in the United States and in light-duty fleet deployments in Europe, in addition to stationary batteries. Currently, these chargers and batteries are located throughout the United States, Europe, and Japan. Megawatts under management in the first quarter increased 3.6% over the fourth quarter of 2024 to 31.8 megawatts from 30.7 megawatts.
Speaker Change: Now turning to our megawatts under management and estimated future grid service revenues as a reminder megawatts under management is a metric we use to quantify the aggregated amount of electrical capacity from the deployment of our <unk> charges.
Speaker Change: Which are primarily deployed in the electric school bus market in the United States and in light duty fleet deployments in Europe. In addition to stationary batteries. Currently these chargers and batteries are located throughout the United States Europe and Japan.
Speaker Change: Megawatts under management in the first quarter increased three 6% over the fourth quarter of 2024 to $31 eight megawatts from 37 megawatts.
David Robson: and a 19.5% increase compared to the first quarter of 2024. In terms of its composition, 7.1 megawatts were from stationary batteries and 24.7 megawatts were from EV chargers. We continue to expect further growth in our megawatts under management in 2025, as we continue to commission our backlog of customer orders we have earned, in addition to new business we anticipate winning, which we have visibility to in our pipeline for both EV chargers and stationary batteries. Now, turning to backlog, on March 31st, our hardware and service backlog increased to 19.7 million, an increase of 1.4 million from 18.3 million reported at December 31st, 2024.
Speaker Change: And a 19, 5% increase compared to the first quarter of 2024.
Speaker Change: In terms of its composition seven one megawatts were from stationary batteries and $24 seven megawatts.
Speaker Change: From EV Chargers.
Speaker Change: We continue to expect further growth in our megawatts under management in 2025, as we continue to commission our backlog of customer orders. We have earned in addition to new business, we anticipate winning which we have visibility to our pipeline for both EV Chargers and stationary batteries.
Speaker Change: Now turning to backlog on March 31, our hardware and service backlog increased to $19 7 million an increase of $1 4 million from $18 3 million reported at December 31, 2024.
David Robson: This increase is related to contracts with customers that are expected to converge in sales in 2025. As we look out to the next several quarters, we expect to see more developments on our New Mexico contract and the Fresno project. We also anticipate improvements in our cash burn resulting from the benefits of lower operating costs compared with last year.
Speaker Change: This increase is related to contracts with customers that are expected to be heard in sales in 2025.
Speaker Change: As we look out to the next several quarters, we expect to see more developments on our new Mexico contract and the Fresno project. We also anticipate improvements in our cash burn, resulting from the benefits of lower operating costs compared with last year.
David Robson: That concludes my portion of the prepared remarks.
Gregory: That concludes my portion of the prepared remarks Gregory back to you to conclude.
Gregory Poilasne: Gregory, back to you to conclude. Thank you, David. In summary, though our top-line revenue is still a work in progress, we have executed on some fundamental transformation aspects. We are reducing our cash burn while focusing the organization on profitability, and we have started to execute on our M&A plan.
Gregory: Thank you David.
Gregory: In summary, there are top line revenues to work in progress we have executed on some fundamental transformation aspects, we are reducing our cash burn while focusing the organization on profitability and we have started to execute on our M&A plan. This quarter is a key stepping stone in our transformation.
Gregory Poilasne: This quarter is a key stepping stone in our transformation. Thank you.
Gregory: Thank you.
Operator: We will now begin the question-and-answer session. To ask a question, you may press star, then 1 on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the If at any time your question has been addressed and you would like to withdraw your question, please press star and then 2.
Speaker Change: We will now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone.
Gregory: If you are using a speakerphone please pick up your handset before pressing the keys.
Gregory: If at any time. Your question has been addressed and you would like to withdraw your question. Please press Star and then two.
Operator: At this time, we will pause momentarily to assemble our robot.
Gregory: At this time, we will pause momentarily to assemble a roster.
Operator: This concludes our question and answer session.
Gregory: This concludes our question and answer session I would like to turn the conference back over to Gregory <unk> for any closing remarks.
Gregory Poilasne: I would like to turn the conference back over to Gregory Poilasne for any closing remarks. I want to again emphasize our expectation in terms of the transformation that we are going through and the opportunities that we are facing and we are looking forward to sharing more with you over the next few months. Thank you very much.
Speaker Change: I want to again emphasize our expectation in terms of the transformation that's going through when the opportunities that we are facing and we are looking forward to sharing more with you.
Gregory: Over the next few months, thank you very much.
Operator: Conference is now concluded.
Speaker Change: Conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Operator: Thank you for attending today's presentation.
Operator: You may now disconnect.
Speaker Change: Okay.
Speaker Change: Great.