SUNation Energy, Inc.
For the period ended Sep 30, 2025. Filed Nov 7, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 7, 2025
SUNE$2.05+2.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-15.
0000022701-25-000010
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-07.
0000022701-25-000015
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 118 previous paragraphs and 109 current paragraphs.
60 unchanged; 32 reworded; 17 added; 24 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 7 previous and 6 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (17)
Current report
Consolidated sales increased $4,275,250, or 29.0% to $18,993,636 in the third quarter of 2025 from $14,718,386 in the third quarter of 2024, with a 54% increase within residential contract revenue and a 72% increase in service revenue, partially offset by a 43% decrease in commercial revenue. On a consolidated basis, overall kilowatts installed on residential projects increased 52%, revenue per residential installation increased 25% and the overall price per watt on residential projects increased slightly at 2% in the third quarter of 2025 as compared to the third quarter of 2024. The overall increase in residential revenue is driven by increased customer demand to install solar systems prior to the expiration of federal tax credits at December 31, 2025 under the passing of the One Big Beautiful Bill Act.
Current report
SUNation NY Operating Results
Current report
Residential contract revenue increased $3,397,156, or 52%, due to a 45% increase in number of systems installed, 66% increase in kilowatts installed and a 5% increase in revenue per install. Commercial contract revenue decreased $1,389,580, or 38%, due to larger projects that had been pushed into the second half of 2024. Service revenue increased $367,480, or 74%, due to higher battery and other add-on installations.
Current report
Selling, general and administrative expenses increased 22% or $751,986 to $4,211,881 in 2025 (32% as a percentage of sales) as compared to $3,459,895 in 2024 (33% as a percentage of sales), due primarily to an increase in selling and marketing expenses on higher residential contract revenue. Amortization expense remained flat at $203,125 in 2025 as compared to 2024.
Current report
Gross profit increased 60% to $1,920,433 in the third quarter of 2025 as compared to gross profit of $1,201,425 in the third quarter of 2024 due primarily to the increase in revenue and improvement in gross margin. Gross margin increased to 32.1% in the third quarter of 2025 compared to 29.5% in the third quarter of 2024, driven by a decrease in labor and overhead costs as a percentage of revenue.
Current report
Comparison of the Nine Months Ended September 30, 2025 and 2024
Current report
SUNation NY Operating Results
Current report
Gross profit increased 10% to $12,924,856 in 2025 as compared to gross profit of $11,698,379 in 2024 due primarily to the increase in revenue and gross margin improvement. Gross margin increased to 39.9% in 2025 compared to 38.8% in 2024 due primarily to revenue mix with higher margin residential revenue making up a larger percentage of the total revenue in 2025 as compared to 2024
Current report
Residential contract sales increased $697,892, or 7%, despite a 1% decrease in kilowatts installed and a 7% decrease in systems installed, due to a 26% increase in battery capacity installed and a 8% increase in price per watt installed.
Current report
Gross profit increased 13% to $3,557,671 in the first nine months of 2025 as compared to gross profit of $3,135,148 in the first nine months of 2024 due primarily to the increase in revenue and improvement in gross margins. Gross margin increased to 28.9% in the first nine months of 2025 compared to 27.6% in the first nine months of 2024 due primarily to a decrease in material and labor costs as a percentage of revenue.
Current report
Goodwill: Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the assets acquired and liabilities assumed from acquisitions. We test goodwill for impairment annually on October 1 or more frequently if events and circumstances warrant. Such events and circumstances may be a significant change in our business climate, economic and industry trends, legal factors, negative operating performance indicators, significant competition or changes in strategy. We perform our goodwill impairment test at the reporting unit level, which is the same as our operating segments.
Current report
An impairment charge for goodwill is recognized only when the estimated fair value of a reporting unit, including goodwill, is less than its carrying amount. In applying the goodwill impairment assessment, the Company may assess qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. Qualitative factors may include, but are not limited to, economic, market and industry conditions, cost factors and overall financial performance of the reporting unit. If after assessing these qualitative factors, the Company determines it is "more-likely-than not" that the fair value is less than the carrying value, a quantitative assessment of goodwill is required. The quantitative impairment test requires judgment, including the identification of reporting units, the assignment of assets, liabilities and goodwill to reporting units, and the determination of fair value of each reporting unit. The impairment test requires the comparison of the fair value of each reporting unit with its carrying amount, including goodwill. We estimate the reporting units’ fair value using a combination of the income approach based upon projected discounted cash flows of the reporting unit and the market approach based upon the market multiple of comparable publicly traded companies. If the estimated fair value of the reporting entity exceeds the carrying value, the goodwill is not impaired, and no further review is required. However, if the carrying value exceeds the estimated fair value of the reporting unit, an impairment expense should be recognized for the excess of the carrying value over the fair value.
Current report
Under the income approach, the estimated discounted cash flows are based on the best information available to us at the time, including supportable assumptions and projections we believe are reasonable. Our discounted cash flow estimates use discount rates that correspond to a weighted-average cost of capital consistent with a market-participant view. Certain other key assumptions utilized, including revenue and cash flow projections, are based on estimates consistent with those utilized in our annual budgeting and planning process that we believe are reasonable. However, if we do not achieve the results reflected in the assumptions and estimates, our goodwill impairment evaluations could be adversely affected, and we may impair a portion or all of our goodwill, which would adversely affect our operating results in the period of impairment.
Current report
The market approach identifies the revenue multiples of comparable publicly traded companies. The reporting unit’s revenue projections are multiplied by the market multiple to estimate its current estimated fair value. If the market multiples or revenue value assumptions are incorrect, our goodwill impairment evaluation could also be adversely affected, and we may impair a portion or all of our goodwill, which would adversely affect our operating results in the period of impairment.
Current report
During the third quarter of 2025, as a result of a material decline forecasted revenues and operating results due to the implications of the OBBBA, we performed an interim quantitative analysis as of September 30, 2025. Based on the results of this analysis, we concluded that there was no impairment indication within our HEC and SUNation NY reporting units as there was adequate cushion of 21% and 34%, respectively, between the fair value and carrying value of the reporting units.
Current report
Recoverability of Long-Lived Assets and Intangible Assets: The Company reviews its long-lived assets and definite lived intangible assetsfor impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may not be fully recoverable. If indicators of impairment exist, management identifies the asset group that includes the potentially impaired long-lived asset, at the lowest level at which there are separate, identifiable cash flows. If the fair value for the asset is less than the carrying amount of the asset, a loss is recognized for the difference between the fair value and carrying amount of the asset.
Current report
During the third quarter of 2025, as a result of the OBBBA, the Company performed an impairment test on the tradenames and trademarks intangible assets associated with both the HEC and SUNation NY reporting units as of September 30, 2025. The Company calculated the undiscounted cash flows associated with the asset groups and compared that to the carrying value of the asset groups. As the asset groups did not meet the recoverability test, the Company calculated the fair value of the tradenames and trademarks intangible assets and compared it to the carrying value of the intangible assets. The fair value of the intangible assets within both reporting units was less than the carrying value, however, since the carrying value of the asset groups, was less than the fair value of the asset groups, as calculated in the goodwill impairment analysis, no impairment charge was realized.
Removed paragraphs (24)
Previous report
Reverse Stock Splits
Previous report
June 2024 Reverse Stock Split
Previous report
On January 3, 2024, the Company’s shareholders approved a reverse stock split of the Company’s common stock at a ratio within a range of 1-for-2 and 1-for-15 and granted the Company’s board of directors the discretion to determine the timing and ratio of the split within such range.
Previous report
On May 28, 2024, the Company’s board of directors determined to effect the reverse stock split of the common stock at a 1-for-15 ratio (the “June Reverse Stock Split”) and approved an amendment (“June Reverse Stock Split Amendment”) to the Fourth Amended and Restated Articles of Incorporation of the Company to effect the June Reverse Stock Split.
Previous report
Effective June 12, 2024, the Company amended its Fourth Amended and Restated Articles of Incorporation to implement the June Reverse Stock Split. The Company's common stock began trading on a split-adjusted basis when the market opened on June 12, 2024 (the "June Effective Date").
Previous report
As a result of the June Reverse Stock Split on the June Effective Date, every 15 shares of common stock then issued and outstanding automatically were combined into one share of common stock, with no change in par value per share. No fractional shares were outstanding following the June Reverse Stock Split, and any fractional shares that would have resulted from the June Reverse Stock Split were settled in cash. The number of shares of common stock outstanding was reduced from 108,546,773 to 7,235,731, with 720.901 fractional shares paid out in cash totaling $1,132. The total number of shares authorized for issuance was reduced to 7,500,000 in proportion to the June Reverse Stock Split ratio.
Previous report
October 2024 Reverse Stock Split
Previous report
On July 19, 2024, the Company’s shareholders approved a reverse stock split of the Company’s common stock at a ratio within a range of 1-for-2 and 1-for-200 and granted the Company’s board of directors the discretion to determine the timing and ratio of the split within such range.
Previous report
On October 1, 2024, the Company’s board of directors determined to effect the reverse stock split of the common stock at a 1-for-50 ratio (the “October Reverse Stock Split”) and approved an amendment (“October Reverse Stock Split Amendment”) to the Fourth Amended and Restated Articles of Incorporation of the Company to effect the October Reverse Stock Split.
Previous report
Effective October 17, 2024, the Company amended its Fourth Amended and Restated Articles of Incorporation to implement the October Reverse Stock Split. The Company's common stock began trading on a split-adjusted basis when the market opened on October 17, 2024 (the "October Effective Date").
Previous report
As a result of the October Reverse Stock Split on the October Effective Date, every 50 shares of common stock then issued and outstanding automatically were combined into one share of common stock, with no change in par value per share. No fractional shares were outstanding following the Reverse Stock Split, and any fractional shares that would have resulted from the October Reverse Stock Split were settled in cash. The number of shares of common stock outstanding was reduced from 67,260,696 to 1,344,841, with 372.92 fractional shares payable in cash totaling $1,891. The total number of shares authorized for issuance was reduced from 133,333,333 to 2,666,667 in proportion to the October Reverse Stock Split ratio.
Previous report
April 2025 Reverse Stock Split
Previous report
On April 3, 2025, the Company’s shareholders approved a reverse stock split of the Company’s common stock at a ratio within a range of 1-for-2 and 1-for-200 and granted the Company’s board of directors the discretion to determine the timing and ratio of the split within such range. Additionally, the shareholders also approved an increase in authorized shares to 1,000,000,000 shares.
Previous report
On April 9, 2025, the Company’s board of directors determined to effect the reverse stock split of the common stock at a 1-for-200 ratio (the “April Reverse Stock Split”) and approved an amendment (“April Reverse Stock Split Amendment”) to its Certificate of Incorporation to effect the April Reverse Stock Split.
Previous report
Effective April 16, 2025, the Company amended its Certificate of Incorporation to implement the April Reverse Stock Split. The Company's common stock began trading on a split-adjusted basis when the market opened on April 21, 2025 (the "April Effective Date").
Previous report
As a result of the April Reverse Stock Split on the April Effective Date, every 200 shares of common stock then issued and outstanding automatically were combined into one share of common stock, with no change in par value per share. No fractional shares were outstanding following the April Reverse Stock Split, and any fractional shares that would have resulted from the April Reverse Stock Split were rounded up to the nearest whole share. The number of shares of common stock outstanding was reduced from 672,799,910 to 3,406,614.
Previous report
Consolidated sales decreased $485,166, or 3.6% to $13,064,254 in the second quarter of 2025 from $13,549,420 in the second quarter of 2024, with a 12% decline within residential contract revenue, partially offset by a 193% increase in commercial revenue. On a consolidated basis, while overall kilowatts installed on residential projects decreased 11% in the second quarter of 2025 from the second quarter of 2024, overall price per watt remained consistent and revenue per install increased 5%.
Previous report
SUNation Operating Results
Previous report
Gross profit decreased 19% to $878,495 in the second quarter of 2025 as compared to gross profit of $1,079,485 in the second quarter of 2024 due primarily to the decrease in revenue. Gross margin decreased slightly to 27.1% in the second quarter of 2025 compared to 28.3% in the second quarter of 2024.
Previous report
Comparison of the Six Months Ended June 30, 2025 and 2024
Previous report
SUNation Operating Results
Previous report
Gross profit decreased slightly to $7,633,604 in 2025 as compared to gross profit of $7,664,079 in 2024 due primarily to the decrease in revenue. Gross margin remained stable at 39.4% in 2025 compared to 39.3% in 2024.
Previous report
Selling, general and administrative expenses decreased 3% to $7,594,004 in 2025 (39% as a percentage of sales) as compared to $7,843,159 in 2024 (40% as a percentage of sales), due primarily to a decrease in personnel costs on lower headcount. Amortization expense remained flat at $406,250 in 2025 as compared to 2024.
Previous report
Gross profit decreased 15% to $1,637,238 in the first six months of 2025 as compared to gross profit of $1,933,723 in the first six months of 2024 due primarily to the decrease in revenue. Gross margin decreased slightly to 25.8% in the first six months of 2025 compared to 26.5% in the first six months of 2024.
Reworded paragraphs (32)
Previous wording
Our current business units, Hawaii Energy Connection, LLC (“HEC”), and New York-based subsidiaries, the SUNation entities (collectively, “SUNation”). are engaged in the design, installation, and maintenance of solar energy systems across residential, commercial, and municipal sectors. Our team specializes in providing tailored solar solutions that meet the specific energy needs of each client, ensuring both efficiency and sustainability. In addition to our core solar services, we also offer energy storage systems to optimize energy use and increase reliability. Our New York business unit further integrates a broader range of services, including residential roofing solutions, to ensure seamless solar installations and long-term durability. Additionally, we provide community solar services that allow groups of individuals, businesses, or organizations to share the benefits of a single solar array, making renewable energy accessible to more people in the community.
Current wording
Our current business units, Hawaii Energy Connection, LLC (“HEC”), and New York-based subsidiaries, the SUNation entities (collectively, “SUNation NY”). are engaged in the design, installation, and maintenance of solar energy systems across residential, commercial, and municipal sectors. Our team specializes in providing tailored solar solutions that meet the specific energy needs of each client, ensuring both efficiency and sustainability. In addition to our core solar services, we also offer energy storage systems to optimize energy use and increase reliability. Our New York business unit further integrates a broader range of services, including residential roofing solutions, to ensure seamless solar installations and long-term durability. Additionally, we provide community solar services that allow groups of individuals, businesses, or organizations to share the benefits of a single solar array, making renewable energy accessible to more people in the community.
Previous wording
The effects of the June 2024 Reverse Stock Split, October 2024 Reverse Stock Split, and April 2025 Reverse Stock Split (collectively, the “Reverse Stock Splits”) have been applied retroactively and are reflected in this Quarterly Report on Form 10-Q for all periods presented. Following each of the Reverse Stock Splits, the number of shares of common stock available for issuance under the Company's equity compensation plans were automatically reduced in proportion to the Reverse Stock Splits ratio. Upon effectiveness, the Reverse Stock Splits also resulted in reductions in the number of shares of common stock issuable upon exercise or vesting of equity awards in proportion to the Reverse Stock Splits ratios and caused a proportionate increase in exercise price or share-based performance criteria, if any, applicable to such awards.
Current wording
For a more complete description of the Company, see Note 1, Nature of Operations, to the Condensed Consolidated Financial Statements included in this report, as well as a more comprehensive description of the recent history of the Company’s 2024 and 2025 reverse stock splits. The effects of the June 2024 Reverse Stock Split, October 2024 Reverse Stock Split, and April 2025 Reverse Stock Split (collectively, the “Reverse Stock Splits”) have been applied retroactively and are reflected in this Quarterly Report on Form 10-Q for all periods presented. Following each of the Reverse Stock Splits, the number of shares of common stock available for issuance under the Company's equity compensation plans were automatically reduced in proportion to the Reverse Stock Splits ratio. Upon effectiveness, the Reverse Stock Splits also resulted in reductions in the number of shares of common stock issuable upon exercise or vesting of equity awards in proportion to the Reverse Stock Splits ratios and caused a proportionate increase in exercise price or share-based performance criteria, if any, applicable to such awards.
Previous wording
Consolidated gross profit increased to $4,839,517 in the second quarter of 2025 as compared to gross profit of $4,792,354 in the second quarter of 2024 due primarily to an improvement in residential margins during the second quarter of 2025. Gross margin increased to 37% during the second quarter of 2025 as compared to 35% in the second quarter of 2024.
Current wording
Consolidated gross profit increased to $7,211,685 in the third quarter of 2025 as compared to gross profit of $5,235,725 in the third quarter of 2024 due primarily to the increase in revenue an improvement in residential margins during the third quarter of 2025. Gross margin increased to 38% during the third quarter of 2025 as compared to 36% in the third quarter of 2024.
Previous wording
Consolidated operating expenses increased 3% to $7,003,104 in the second quarter of 2025 as compared to $6,818,298 in the second quarter of 2024. Consolidated selling, general and administrative expenses decreased $115,194, or 2%, to $6,443,729 in the second quarter of 2025 from $6,558,923 in the second quarter of 2024, due primarily to a decrease in personnel expenses on lower headcount and a decrease in selling expenses on lower revenue, partially offset by $512,821 in compensation expense related to the new earnout liability as discussed in Note 6, Commitments and Contingencies. Amortization expense decreased by $150,000 to $559,375 in the second quarter of 2025 as compared to $709,375 in the same period of the prior year due to the write down of the technology intangible asset at HEC at December 31, 2024, resulting in lower amortization expense in the current year.
Current wording
Consolidated operating expenses increased 9% to $7,457,416 in the third quarter of 2025 as compared to $6,842,462 in the third quarter of 2024. Consolidated selling, general and administrative expenses increased $764,954, or 12%, to $6,898,041 in the third quarter of 2025 from $6,133,087 in the third quarter of 2024, due primarily to $491,130 in compensation expense related to the new earnout liability as discussed in Note 6, Commitments and Contingencies and a $220,822 increase in stock compensation expense. Amortization expense decreased by $150,000 to $559,375 in the third quarter of 2025 as compared to $709,375 in the same period of the prior year due to the write down of the technology intangible asset at HEC at December 31, 2024, resulting in lower amortization expense in the current year.
Previous wording
Consolidated other expense increased by $2,514,888 to expense of $7,429,592 in the second quarter of 2025 as compared to $4,914,704 in the second quarter of 2024. The decrease was primarily related to a $4,263,473 increase in the fair value remeasurement loss on the warrant liability, a $110,504 decrease in fair value remeasurement loss on the contingent value rights (“CVRs”), and $559,939 in financing fees on the issuance of Series A and Series B warrants, partially offset by a $1,055,600 decrease in fair value remeasurement loss on the embedded derivative liability, a $573,503 decrease in interest expense, and a $789,588 increase in fair value remeasurement gain on the contingent forward contract.
Current wording
Consolidated other expense decreased by $1,560,798 to expense of $130,565 in the third quarter of 2025 as compared to $1,691,363 in the third quarter of 2024. The decrease was primarily related to a $1,435,845 fair value remeasurement gain on the warrant liability in the third quarter of 2024 and a $668,131 decrease in interest expense, partially offset by a $587,271 decrease in fair value remeasurement loss on the embedded derivative liability.
Previous wording
Consolidated operating loss in the second quarter of 2025 was $2,163,587 as compared to $2,025,944 in the second quarter of 2024. Net loss in the second quarter of 2025 was $9,607,415, or $(3.14) per diluted share, compared to net loss of $6,934,015, or $(11,022.91) per diluted share, in the second quarter of 2024.
Current wording
Consolidated operating loss in the third quarter of 2025 was $245,731 as compared to $1,606,737 in the third quarter of 2024. Net loss in the third quarter of 2025 was $392,975, or $(0.12) per diluted share, compared to net loss attributable to shareholders(after taking into effect $264,482 in deemed dividends) of $3,563,091, or $(2,350.12) per diluted share, in the third quarter of 2024.
Previous wording
SUNation revenue increased 1% or $89,202, to $9,820,849 in the second quarter of 2025 as compared to $9,731,647 in second quarter of 2024. Revenue in the second quarters of 2025 and 2024 by type were as follows:
Current wording
SUNation NY revenue increased 22% or $2,375,056, to $13,014,951 in the third quarter of 2025 as compared to $10,639,895 in third quarter of 2024. Revenue in the third quarters of 2025 and 2024 by type were as follows:
Previous wording
Gross profit increased 7% to $3,961,022 in the second quarter of 2025 as compared to gross profit of $3,712,869 in the second quarter of 2024 due primarily to the increase in revenue and additional increase in gross margin. Gross margin increased to 40.3% in 2025 compared to 38.2% in 2024 due primarily to higher commercial revenue gross margins due to higher revenue to cover fixed overhead costs and higher residential margins due to lower job material costs as a percentage of revenue.
Current wording
Gross profit increased 31% to $5,291,252 in the third quarter of 2025 as compared to gross profit of $4,034,300 in the third quarter of 2024 due primarily to the increase in revenue and additional increase in gross margin. Gross margin increased to 40.7% in 2025 compared to 37.9% in 2024 due primarily to revenue mix with higher margin residential revenue making a larger percentage of the total revenue in 2025 as compared to 2024. The higher residential margins are driven by lower material costs as a percentage of sales.
Previous wording
HEC sales decreased 15% or $574,368, to $3,243,405 in the second quarter of 2025 as compared to $3,817,773 in the second quarter of 2024. Sales in 2025 and 2024 by type were as follows:
Current wording
HEC sales increased 47% or $1,900,194, to $5,978,685 in the third quarter of 2025 as compared to $4,078,491 in the third quarter of 2024. Sales in 2025 and 2024 by type were as follows:
Previous wording
Residential contract sales decreased $938,457, or 26%, due to a 31% decrease in kilowatts installed and a 8% decrease in battery capacity installed, which was partially offset by a 9% increase in average revenue per system installed due to implemented price increases during the quarter. In the first half of 2024, the Battery Bonus program in Hawaii ended. Under this program, customers were paid a cash incentive and provided energy bill credits to add energy storage to an existing or new rooftop solar system. Service revenue increased $211,627, or 128%, due to an increase in repair and replacement installations.
Current wording
Residential contract sales increased $2,125,428, or 59%, due to a 20% increase in kilowatts installed and a 139% increase in battery capacity installed, which is driving a 61% increase in average revenue per system installed. In May 2025, Hawaii implemented a new Bring Your Own Device Plus (“BYOD Plus”) program. The impact of this new program was realized in third quarter installations. Under this program, customers were paid a cash incentive and provided energy bill credits to add energy storage to an existing or new rooftop solar system. Service revenue increased $96,819, or 67%, due to an increase in repair and replacement installations.
Previous wording
Selling, general and administrative expenses increased 3% to $1,021,320 in the second quarter of 2025 (31% as a percentage of sales) as compared to $991,480 in the second quarter of 2024 (26% as a percentage of sales), due primarily to an increase in personnel expenses on additional headcount.
Current wording
Selling, general and administrative expenses increased 1% to $1,119,994 in the third quarter of 2025 (31% as a percentage of sales) as compared to $1,106,608 in the third quarter of 2024 (27% as a percentage of sales), due primarily to an increase in selling expenses on higher revenues. Amortization expense decreased $150,000 to $356,250 in 2025 as compared to 2024.
Previous wording
The following table summarizes our consolidated results for the six months ended June 30, 2025 and 2024:
Current wording
The following table summarizes our consolidated results for the nine months ended September 30, 2025 and 2024:
Previous wording
Consolidated sales decreased $1,067,725, or 4.0% to $25,700,892 in the first six months of 2025 from $26,768,617 in the first six months of 2024, with declines primarily within the residential contract and service revenue streams, partially offset by increased commercial contract revenue. On a consolidated basis, the decline in residential contract revenue during the first six months of 2025 as compared to the same period of 2024 is due to a 2% decrease on kilowatts installed and a 7% decrease in price per watt installed due to lower battery kilowatts installed within HEC.
Current wording
Consolidated sales increased $3,207,525, or 7.7% to $44,694,528 in the first nine months of 2025 from $41,487,003 in the first nine months of 2024, with increases within the residential contract and service revenue streams, partially offset by decreased commercial contract revenue. On a consolidated basis, the increase in residential contract revenue during the first nine months of 2025 as compared to the same period of 2024 is due to a 14% increase on kilowatts installed and a 7% increase in revenue per system installed.
Previous wording
Consolidated gross profit decreased to $9,270,842 in the first six months of 2025 as compared to gross profit of $9,597,802 in the first six months of 2024 due primarily to the decrease in revenue during the year. Gross margin remained flat at 36% during the first six months of 2025 as compared to the first six months of 2024.
Current wording
Consolidated gross profit increased to $16,482,527 in the first nine months of 2025 as compared to gross profit of $14,833,527 in the first nine months of 2024 due primarily to the increase in revenue during the year. Gross margin increased slightly 37% during the first nine months of 2025 as from 36% during the first nine months of 2024.
Previous wording
Consolidated operating expenses decreased 1% to $13,601,777 in the first six months of 2025 as compared to $13,806,700 in the first six months of 2024. Consolidated selling, general and administrative expenses decreased $704,923, or 5%, to $12,483,027 in the first six months of 2025 from $13,187,950 in the first six months of 2024, due primarily to a decrease in personnel expenses on lower headcount and a decrease in corporate costs including stock compensation expense and legal and other professional fees, partially offset by $512,821 in compensation expense related to the new earnout liability as discussed in Note 6, Commitments and Contingencies. Amortization expense decreased by $300,000 to $1,118,750 in the first six months of 2025 as compared to $1,418,750 in the same period of the prior year due to the write down of the technology intangible asset at HEC at December 31, 2024, resulting in lower amortization expense in the current year.
Current wording
Consolidated operating expenses increased 2% to $21,059,193 in the first nine months of 2025 as compared to $20,649,162 in the first nine months of 2024. Consolidated selling, general and administrative expenses increased slightly to $19,381,068 in the first nine months of 2025 from $19,321,037 in the first nine months of 2024. Amortization expense decreased by $450,000 to $1,678,125 in the first nine months of 2025 as compared to $2,128,125 in the same period of the prior year due to the write down of the technology intangible asset at HEC at December 31, 2024, resulting in lower amortization expense in the current year.
Previous wording
Consolidated other expense increased by $7,221,124 to $8,744,061 in the first six months of 2025 as compared to $1,522,937 in the first six months of 2024. The increase was primarily related to a $7,992,066 increase in the fair value remeasurement on the warrant liability, a $467,410 decrease in fair value remeasurement gain on the contingent value rights (“CVRs”), a $343,471 loss on debt extinguishment, and $1,136,532 in financing fees on the issuance of the contingent forward contract and issuance of Series A and Series B warrants, partially offset by a $1,055,600 decrease in fair value remeasurement loss on the embedded derivative liability, a $899,080 increase in fair value remeasurement gain on the contingent forward contract, and a $767,133 decrease in interest expense.
Current wording
Consolidated other expense increased by $5,660,326 to $8,874,626 in the first nine months of 2025 as compared to $3,214,300 in the first nine months of 2024. The increase was primarily related to a $6,556,221 increase in the fair value remeasurement loss on the warrant liability, $1,136,532 in financing fees on the issuance of the contingent forward contract and issuance of Series A and Series B warrants, a $455,677 decrease in fair value remeasurement gain on the contingent value rights (“CVRs”), and a $307,814 increase in loss on debt extinguishment, partially offset by a $468,329 decrease in fair value remeasurement loss on the embedded derivative liability, a $899,080 increase in fair value remeasurement gain on the contingent forward contract, and a $1,435,264 decrease in interest expense.
Previous wording
Consolidated operating loss in the first six months of 2025 was $4,330,935 as compared to $4,208,898 in the first six months of 2024. Net loss in the first six months of 2025 was $13,103,847, or $(8.42) per diluted share, compared to net loss attributable to shareholders (after taking into effect $11,322,639 in deemed dividends) of $17,054,003, or $(38,216.49) per diluted share, in the first six months of 2024.
Current wording
Consolidated operating loss in the first nine months of 2025 was $4,576,666 as compared to $5,815,635 in the first nine months of 2024. Net loss in the first nine months of 2025 was $13,496,822, or $(6.19) per diluted share, compared to net loss attributable to shareholders (after taking into effect $11,587,121 in deemed dividends) of $20,617,094, or $(25,596.09) per diluted share, in the first nine months of 2024.
Previous wording
SUNation revenue decreased 1% or $119,214, to $19,365,403 in the first six months of 2025 as compared to $19,484,617 in first six months of 2024. Revenue in the first six months of 2025 and 2024 by type were as follows:
Current wording
SUNation NY revenue increased 22% or $2,255,842, to $32,380,354 in the first nine months of 2025 as compared to $30,124,512 in first nine months of 2024. Revenue in the first nine months of 2025 and 2024 by type were as follows:
Previous wording
Residential contract revenue decreased $468,054, or 6%, despite a 5% increase in residential kilowatts installed and a 1% increase in average revenue per system installed, due to a 5% decrease in number of systems installed. Commercial contract revenue increased $769,790, or 156%, due to timing of commercial projects where the prior year had some larger projects from 2024 carry into 2025 and there were delays in the prior year in the start of commercial pipeline projects into the second half of 2024. Service revenue decreased $212,534, or 28%, due to lower battery installations and third-party referral service jobs.
Current wording
Residential contract revenue increased $2,693,517, or 12%, due to a 9% increase in systems installed and a 19% increase in kilowatts installed. Commercial contract revenue decreased $341,095, or 7%, due timing of commercial projects where the prior year had some larger projects from 2024 carry into 2025 and there were delays in the prior year in the start of commercial pipeline projects into the second half of 2024. Service revenue decreased $96,580, or 5%, due to lower battery installations and third-party referral service jobs.
Previous wording
Selling, general and administrative expenses decreased slightly to $3,746,504 in 2025 (38% as a percentage of sales) as compared to $3,970,704 in 2024 (41% as a percentage of sales), due primarily to a decrease in personnel costs on lower headcount and a decrease in selling expenses on lower residential contract revenue. Amortization expense remained flat at $203,125 in 2025 as compared to 2024.
Current wording
Selling, general and administrative expenses increased 4% to $11,805,885 in 2025 (36% as a percentage of sales) as compared to $11,303,054 in 2024 (38% as a percentage of sales), due primarily to an increase in selling and marketing expenses on the increase in residential revenue, partially offset by a decrease in personnel costs on lower headcount. Amortization expense remained flat at $609,375 in 2025 as compared to 2024.
Previous wording
HEC sales decreased 13% or $948,511, to $6,335,489 in the first six months of 2025 as compared to $7,284,000 in the first six months of 2024. Sales in 2025 and 2024 by type were as follows:
Current wording
HEC sales increased 8% or $951,683, to $12,314,174 in the first nine months of 2025 as compared to $11,362,491 in the first nine months of 2024. Sales in 2025 and 2024 by type were as follows:
Previous wording
Residential contract sales decreased $1,427,537, or 21%, due to a 22% decrease in battery capacity installed and a 12% decrease in kilowatts installed. In the first half of 2024, the Battery Bonus program in Hawaii ended. Under this program, customers were paid a cash incentive and provided energy bill credits to add energy storage to an existing or new rooftop solar system. Service revenue increased $326,563, or 81%, due to an increase in repair and replacement installations.
Current wording
In the first half of 2024, the Battery Bonus program in Hawaii ended. Battery installations decreased when this incentive went away. In May 2025, Hawaii implemented a new BYOD Plus program. The impact of this new program was realized in third quarter installations. Under this program, customers were paid a cash incentive and provided energy bill credits to add energy storage to an existing or new rooftop solar system. Service revenue increased $423,382, or 77%, due to an increase in repair and replacement installations.
Previous wording
Selling, general and administrative expenses remained flat at $1,997,994 in the first six months of 2025 (32% as a percentage of sales) as compared to $1,993,532 in the first six months of 2024 (27% as a percentage of sales.
Current wording
Selling, general and administrative expenses remained flat at $3,117,988 in the first nine months of 2025 (25% as a percentage of sales) as compared to $3,100,140 in the first nine months of 2024 (27% as a percentage of sales). Amortization expense decreased $450,000 to $1,068,750 in 2025 as compared to 2024.
Previous wording
As of June 30, 2025, the Company had $3,473,387 in cash, restricted cash and cash equivalents. Of this amount, $1,535,022 was invested in short-term money market funds that are not considered to be bank deposits and are not insured or guaranteed by the Federal Deposit Insurance Corporation or other government agency. These money market funds seek to preserve the value of the investment at $1.00 per share; however, it is possible to lose money investing in these funds. The remainder in cash and cash equivalents is operating cash.
Current wording
As of September 30, 2025, the Company had $5,703,539 in cash, restricted cash and cash equivalents. Of this amount, $883,328 was invested in short-term money market funds that are not considered to be bank deposits and are not insured or guaranteed by the Federal Deposit Insurance Corporation or other government agency. These money market funds seek to preserve the value of the investment at $1.00 per share; however, it is possible to lose money investing in these funds. The remainder in cash and cash equivalents is operating cash.
Previous wording
Of the amounts of cash, restricted cash and cash equivalents on the balance sheet at June 30, 2025, $286,630 consisted of funds that can only be used to support the legacy CSI business, will be distributed to CVR holders and cannot be used to support the working capital needs of the SUNation Energy business.
Current wording
Of the amounts of cash, restricted cash and cash equivalents on the balance sheet at September 30, 2025, $288,948 consisted of funds that can only be used to support the legacy CSI business, will be distributed to CVR holders and cannot be used to support the working capital needs of the SUNation Energy business.
Previous wording
The Company had working capital deficit of $(1,850,380) at June 30, 2025, consisting of current assets of $10,951,412 and current liabilities of $12,801,792 compared to working capital deficit of $(16,051,658) at December 31, 2024.
Current wording
The Company had working capital deficit of $(1,848,119) at September 30, 2025, consisting of current assets of $17,186,329 and current liabilities of $19,034,448 compared to working capital deficit of $(16,051,658) at December 31, 2024.
Previous wording
Cash used in operating activities was $3,533,533 in the first six months of 2025 as compared to $3,425,726 in the same period of 2024. The increase in negative cash flow from operations is primarily driven by the increase in the net loss and an increase in payments against accounts payable. Significant working capital changes in the six months ended June 30, 2025 included a decrease of accounts receivable of $1,601,897, a decrease in accounts payable of $489,960, and a decrease in accrued interest of $634,467.
Current wording
Cash used in operating activities was $1,146,338 in the first nine months of 2025 as compared to $4,393,846 in the same period of 2024. The decrease in negative cash flow from operations is primarily driven by the increase in the net loss and an increase in payments against accounts payable, partially offset by an increase in customer deposits. Significant working capital changes in the nine months ended September 30, 2025 included a decrease of other assets of $1,145,270, a decrease in accrued interest of $677,582, an increase in customer deposits of $2,461,077, and an increase in other accrued expenses of $1,700,111.
Previous wording
Net cash used in investing activities was $8,817 in the first six months of 2025 compared to $11,461 used in investing activities in the same period of 2024 primarily related to capital expenditures.
Current wording
Net cash used in investing activities was $17,787 in the first nine months of 2025 compared to $23,631 used in investing activities in the same period of 2024 primarily related to capital expenditures.
Previous wording
Net cash provided by financing activities was $5,864,389 in the first six months of 2025 compared to $172,899 in the same period of 2024. Net cash provided by financing activities in the first six months of 2025 was due to $17,871,964 in net proceeds from the issuance of common stock under a registered direct offering and $351,372 in proceeds from the issuance of common stock under the at-the-market offering, partially offset by $9,552,943 in payments against loans payable, $2,500,000 in payments of contingent consideration, and $267,391 in payments for the termination of warrants. Net cash provided by financing activities in the first six months of 2024 was due to$918,988 in net proceeds from the issuance of common stock under a registered direct offering, partially offset by payments against loans payable.
Current wording
Net cash provided by financing activities was $5,716,316 in the first nine months of 2025 compared to $1,183,220 in the same period of 2024. Net cash provided by financing activities in the first nine months of 2025 was due to $17,871,964 in net proceeds from the issuance of common stock under a registered direct offering and $351,372 in proceeds from the issuance of common stock under the at-the-market offering, partially offset by $9,765,760 in payments against loans payable, $2,500,000 in payments of contingent consideration, and $267,391 in payments for the termination of warrants. Net cash provided by financing activities in the first nine months of 2024 was due to $1,000,000 in proceeds from the issuance of common stock under a registered direct offering and $1,604,000 in borrowings from Conduit Capital US Holdings LLC (“Conduit”) and MBB Energy, LLC (“MBB”), partially offset by equity issuance costs and payments against loans payable.
Previous wording
In connection with the SUNation acquisition, on November 9, 2022, the Company issued a $5,486,000 Long-Term Promissory Note(the “Long-Term Note”). The Long-Term Note was unsecured and matured on November 9, 2025. It carried an annual interest rate of 4% until the first anniversary of issuance, then 8% thereafter until the Long-Term Note was paid in full. The Company was required to make a principal payment of $2.74 million on the second anniversary of the Long-Term Note. The Long-Term Note may be prepaid at our option at any time without penalty. On April 10, 2025, the Long-Term Note was amended and restated whereby the principal amount of $5,486,000 previously due and payable under the original Long-Term Note, together with all accrued and unpaid interest owing thereunder, shall be due and payable on May 1, 2028, and such amended note shall become a senior secured instrument. Principal and interest payments under the amended Long-Term Note are payable monthly on the first day of each month commencing on June 1, 2025 for thirty-six consecutive months thereafter. Additionally, pursuant to the terms of that certain Senior Secured Contingent Note Instrument, entered into on April 10, 2025, the unearned 2024 earnout was rescheduled and is based on the earnout terms set forth therein pursuant to the financial conditions and terms covering each of fiscal years 2024 and 2025 and, if attained, shall be payable in fiscal year 2026, which payment is further conditioned on the continued employment of the note holders at the time of such earnout payment trigger date.
Current wording
In connection with the SUNation NY acquisition, on November 9, 2022, the Company issued a $5,486,000 Long-Term Promissory Note(the “Long-Term Note”). The Long-Term Note was unsecured and matured on November 9, 2025. It carried an annual interest rate of 4% until the first anniversary of issuance, then 8% thereafter until the Long-Term Note was paid in full. The Company was required to make a principal payment of $2.74 million on the second anniversary of the Long-Term Note. The Long-Term Note may be prepaid at our option at any time without penalty. On April 10, 2025, the Long-Term Note was amended and restated whereby the principal amount of $5,486,000 previously due and payable under the original Long-Term Note, together with all accrued and unpaid interest owing thereunder, shall be due and payable on May 1, 2028, and such amended note became a senior secured instrument. Principal and interest payments under the amended Long-Term Note are payable monthly on the first day of each month commencing on June 1, 2025 for thirty-six consecutive months thereafter. Additionally, pursuant to the terms of that certain Senior Secured Contingent Note Instrument, entered into on April 10, 2025, the unearned 2024 earnout was rescheduled and is based on the earnout terms set forth therein pursuant to the financial conditions and terms covering each of fiscal years 2024 and 2025 and, if attained, shall be payable in fiscal year 2026, which payment is further conditioned on the continued employment of the note holders at the time of such earnout payment trigger date.
Previous wording
The Company issued CVRs prior to the Closing to CSI shareholders of record on the close of business on March 25, 2022. The CVR entitles the holder to a portion of the cash, cash equivalents, investments and net proceeds of any divestiture, assignment, or other disposition of all legacy assets of CSI and/or its legacy subsidiaries, JDL and Ecessa, that are related to CSI’s pre-merger business, assets, and properties that occur during the 24-month period following the Closing. The CVR liability as of June 30, 2025 was estimated at $286,630 and represented the estimated fair value as of that date of the legacy CSI assets to be distributed to CVR holders as of that date. This amount is recorded as a current liability that includes the remaining restricted cash and cash equivalents. The proceeds from CSI’s pre-merger business working capital and related long-term assets and liabilities are not available to fund the working capital needs of the post-merger company.
Current wording
The Company issued CVRs prior to the Closing to CSI shareholders of record on the close of business on March 25, 2022. The CVR entitles the holder to a portion of the cash, cash equivalents, investments and net proceeds of any divestiture, assignment, or other disposition of all legacy assets of CSI and/or its legacy subsidiaries, JDL and Ecessa, that are related to CSI’s pre-merger business, assets, and properties that occur during the 24-month period following the Closing. The CVR liability as of September 30, 2025 was estimated at $288,948 and represented the estimated fair value as of that date of the legacy CSI assets to be distributed to CVR holders as of that date. This amount is recorded as a current liability that includes the remaining restricted cash and cash equivalents. The proceeds from CSI’s pre-merger business working capital and related long-term assets and liabilities are not available to fund the working capital needs of the post-merger company.
Previous wording
The discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities, at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Generally, we base our estimates on historical experience and on various other assumptions in accordance with GAAP that we believe to be reasonable under the circumstances. Actual results may differ from these estimates and such differences could be material to our financial position and results of operations. Critical accounting estimates are those that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition and results of operations. For additional information, please see the discussion of our critical accounting estimates in our Annual Report on Form 10-K for the year ended December 31, 2024. There have been no changes to our critical accounting estimates as described in our Annual Report on Form 10-K for the year ended December 31, 2024.
Current wording
The discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities, at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Generally, we base our estimates on historical experience and on various other assumptions in accordance with GAAP that we believe to be reasonable under the circumstances. Actual results may differ from these estimates and such differences could be material to our financial position and results of operations. Critical accounting estimates are those that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition and results of operations. For additional information, please see the discussion of our critical accounting estimates in our Annual Report on Form 10-K for the year ended December 31, 2024. There have been no changes to our critical accounting estimates as described in our Annual Report on Form 10-K for the year ended December 31, 2024, except as set forth below.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
For a more complete description of the Company, see Note 1, Nature of Operations, to the Condensed Consolidated Financial Statements included in this report.
Previous report — wording carried elsewhere
Residential contract revenue decreased $703,640, or 4%, despite a 1% increase in residential kilowatts installed and a 1% increase in average price per system installed, due to a 6% decrease in number of systems installed. Commercial contract revenue increased $1,048,485, or 70%, due timing of commercial projects where the prior year had some larger projects from 2024 carry into 2025 and there were delays in the prior year in the start of commercial pipeline projects into the second half of 2024. Service revenue decreased $464,059, or 34%, due to lower battery installations and third-party referral service jobs.