AirJoule Technologies Corp.
For the period ended Jun 30, 2025. Filed Aug 14, 2025.
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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.
Jun 30, 2025 · Filed Aug 14, 2025
AIRJ$2.39+13.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-13.
0000950170-25-070295
Item 2. Management’s Discussion and Analysis of Financial Condition And Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-14.
0000950170-25-108487
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 116 previous paragraphs and 95 current paragraphs.
50 unchanged; 32 reworded; 12 added; 33 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 2 previous and 2 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 (12)
Current report
On April 23, 2025, we entered into the April 2025 PIPE Subscription Agreements with the April 2025 PIPE Investors, pursuant to which, among other things, the April 2025 PIPE Investors agreed to subscribe for and purchase from the Company, and we agreed to issue and sell to the April 2025 PIPE Investors, an aggregate of 3,775,126 newly issued shares of Class A common stock at a purchase price of $3.98 per share on the terms and subject to the conditions set forth therein. The April 2025 PIPE Subscription Agreements entitled the April 2025 PIPE Investors to shelf registration rights with respect to the shares of Class A common stock they purchased. The transaction closed on April 25, 2025, and the shares of Class A common stock were issued and sold to the April 2025 PIPE Investors in reliance on Section 4(a)(2) of the Securities Act.
Current report
The Amended LLC Agreement
Current report
General and administrative expenses for the six months ended June 30, 2025 were $6.5 million as compared to $4.0 million for the six months ended June 30, 2024. The $2.5 million increase was primarily related to a $2.4 million increase in share-based compensation expense, a $1.3 million increase in salaries and benefits as a result of an increased headcount and a $0.6 million increase in other expenses related to public company activity offset by a $0.6 million decrease in audit and legal fees, a $0.2 million decrease in professional services, a $0.2 million decrease in licensing fees and the reimbursement of costs incurred per the statement of work with AirJoule, LLC of $0.8 million. We expect that our general and administrative expenses will increase in future periods commensurate with the expected growth of our business and increased expenditures associated with our status as an exchange-listed public company.
Current report
Research and development expenses for the six months ended June 30, 2025 were $0.8 million as compared to $1.9 million for the six months ended June 30, 2024. The $1.1 million decrease in research and development was primarily related to a $0.3 million increase in share-based compensation and salaries and benefits as a result of an increased headcount offset by a $1.1 million decrease in purchasing of research and development materials, patent fees and consulting services and the reimbursement of costs incurred per the statement of work with AirJoule, LLC of $0.3 million.
Current report
Sales and marketing expenses for the three months ended June 30, 2025 were $7,794 as compared to $74,841 for the three months ended June 30, 2024.
Current report
Sales and marketing expenses for the six months ended June 30, 2025 were $22,003 as compared to $112,566 for the six months ended June 30, 2024.
Current report
Depreciation and amortization expense for the six months ended June 30, 2025 and 2024 was $3,877 and $2,301, respectively.
Current report
Interest income was $526,758 and $242,626 for the six months ended June 30, 2025 and 2024, respectively. This is primarily a result of the increase in our cash balance.
Current report
On April 23, 2025, we entered into the April 2025 PIPE Subscription Agreements with the April 2025 PIPE Investors pursuant to which, among other things, the April 2025 PIPE Investors agreed to subscribe for and purchase from the Company, and we agreed to issue and sell to the April 2025 PIPE Investors, an aggregate of 3,775,126 newly issued shares of Class A common stock at a purchase price of $3.98 per share on the terms and subject to the conditions set forth therein. The April 2025 PIPE Subscription Agreements entitled the April 2025 PIPE Investors to shelf registration rights with respect to the shares of Class A common stock they purchased. The transaction closed on April 25, 2025, and the shares of Class A common stock were issued and sold to the April 2025 PIPE Investors in reliance on Section 4(a)(2) of the Securities Act.
Current report
During the six months ended June 30, 2025, net cash used in operating activities was $2.2 million and primarily reflected our net income of $17.3 million, a $4.3 million equity loss from our investment in AirJoule, LLC and a $2.2 million increase in our operating assets and liabilities offset by net noncash operating activities of $25.3 million of changes in fair value of our Earnout, True Up, Subject Vesting shares and Equity Line Obligation liabilities and $0.7 million of share-based compensation and deferred tax benefit. We expect to continue to use cash in our operating activities with the expected growth of our business.
Current report
During the six months ended June 30, 2024, net cash used in operating activities was $17.6 million and primarily reflected our net income of $195.0 million, a $84.5 million deferred tax expense and a $0.6 million equity loss from our investment in AirJoule, LLC offset by net noncash operating activities of $282.0 million related to the contribution to AirJoule, LLC, the settlement of legal fees and other costs in connection with the business combination, $4.9 million of changes in fair value of our Earnout, True Up and Subject Vesting shares liabilities and a $11.0 million decrease in our operating assets and liabilities.
Current report
During the six months ended June 30, 2025, net cash provided by financing activities was $14.7 million primarily as a result of the $14.5 million net proceeds from the April 2025 PIPE Offering and $0.1 million of proceeds from the exercise of options.
Removed paragraphs (33)
Previous report
Sales and marketing expenses for the three months ended March 31, 2025 was $14,209 as compared to $37,725 for the three months ended March 31, 2024. We expect that our sales and marketing expenses will increase in future periods commensurate with the expected growth of our business.
Previous report
Capital Contribution
Previous report
During the three months ended March 31, 2025, net cash provided by operating activities was $72,246 and primarily reflected our net income from operations and changes in operating assets and liabilities including decreases in our due from related party and accrued expenses and other liabilities accounts.
Previous report
During the three months ended March 31, 2024, net cash used in operating activities was $6.4 million and primarily reflected our net income from operations and decreases in accounts payable and accrued expenses and other liabilities.
Previous report
Management’s discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements, which are prepared in conformity with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make certain estimates, judgments, and assumptions that we believe are reasonable based upon the information available. These estimates and assumptions can be subjective and complex and may affect the reported amounts of assets and liabilities, revenues, and expenses reported in those financial statements. As a result, actual results could differ from such estimates and assumptions. Such changes to estimates could potentially result in impacts that would be material to the condensed consolidated financial statements.
Previous report
While our significant accounting policies are described in more detail in Note 2 to our condensed consolidated financial statements appearing in Item 1 to this Quarterly Report on Form 10-Q, we believe that the following accounting policies were most critical to the judgments and estimates used in the preparation of our condensed consolidated financial statements.
Previous report
Share-Based Compensation
Previous report
We account for share-based compensation arrangements granted to employees and non-employees in accordance with ASC 718, Share-based Compensation by measuring the grant date fair value of each award and recognizing the resulting expense over the period during which the recipient is required to perform services in exchange for the award. Equity-based compensation expense is only recognized for awards subject to performance conditions if it is probable that the applicable performance conditions will be achieved. We account for forfeitures when the forfeitures occur. Once it is probable that the performance condition will be achieved, we recognize stock-based compensation cost over the remaining requisite service period on a graded vesting basis, with a cumulative adjustment for the portion of the service period that occurred for the period prior to the performance condition becoming probable of achievement, if any. Stock-based compensation expense for equity awards that contain market vesting conditions is recognized over the requisite service period commencing on the grant date even if the market condition is not satisfied.
Previous report
We estimate the fair value of stock option awards subject to only a service condition on the date of grant using the Black-Scholes valuation model. The Black-Scholes model requires the use of highly subjective and complex assumptions, including the stock option’s expected term, the price volatility of the underlying stock, the applicable risk-free interest rate and the expected dividend yield of the underlying common stock, as well as an estimate of the fair value of the common stock underlying the stock option. The grant date fair value of restricted stock units that contain service vesting conditions are estimated based on the fair value of the underlying stock on the grant date. For restricted stock units with market vesting conditions, the fair value is estimated using a Monte Carlo simulation model, which incorporates the likelihood of achieving the market condition.
Previous report
We estimate the fair value of Earnout Shares (as described below), which are considered compensatory awards and accounted for under ASC 718, using the Monte-Carlo simulation model. The Monte-Carlo simulation model was selected as the valuation methodology for the Earnout Shares due to the path-dependent nature of applicable triggering events. Under ASC 718, such Earnout Shares are measured at fair value as of the grant date and expense is recognized over the applicable time-based vesting period (the applicable triggering event is a market condition and does not impact expense recognition). The Monte-Carlo model requires the use of highly subjective and complex assumptions, estimates and judgements, including the current stock price, the volatility of the underlying stock, the expected term the risk-free interest rate, the selection of comparable companies, and the probability of possible future events. Changes in any or all of these estimates and assumptions or the relationships between those assumptions impact our valuations as of each valuation date and may have a material impact on the valuation of share-based compensation arrangements. An increase of 100-basis points in interest rates would not have a material impact on our share-based compensation. During the period from the date of the Business Combination through March 31, 2025 we did not record share-based compensation expense associated with these Earnout Shares as the performance conditions associated with these Earnout Shares were not deemed probable of achievement. Unrecognized share-based compensation expense for these Earnout Shares with a performance-based vesting condition that was not deemed probable of occurring as of March 31, 2025 was $3.2 million which is expected to vest subject to the performance-based vesting condition being satisfied or deemed probable.
Previous report
Earnout Shares Liability
Previous report
In connection with the reverse recapitalization and pursuant to the Merger Agreement, eligible former Predecessor equityholders are entitled to receive the Earnout Shares upon us achieving certain Earnout Milestones. The settlement of the Earnout Shares to the holders of the Predecessor's common units contain variations in something other than the fair value of the issuer’s equity shares. As such, management determined that they should be classified as a liability and recognized at fair value at each reporting period with changes in fair value included in earnings.
Previous report
We estimated fair value of the Earnout Shares with a Monte Carlo simulation using a distribution of potential outcomes for expected earnings before interest, taxes, depreciation, and amortization, or EBITDA, and stock price at expected commission dates, utilizing a correlation coefficient for EBITDA and stock price, and assuming $50.0 million of Annualized EBITDA per production line, with each of the production lines commissioned over a five-year period. EBITDA was discounted to the valuation date with a weighted average cost of capital estimate and forecasted to each estimated commission date. Earnout mechanics at each estimated commission date were assessed, and if the Earnout Thresholds were achieved, the future value of the Earnout Shares was discounted to the valuation date utilizing a risk-free rate commensurate with the overall term. Expected EBITDA assumes that each production line will achieve equivalent production generating $50.0 million of Annualized EBITDA. The commission dates used reflected management’s best estimates regarding the time to complete full construction and operational viability of a production line, including all permitting, regulatory approvals and necessary or useful inspections. The Earnout term of 5 years and the Earnout mechanics represent contractual inputs. The contingent Earnout Shares liability involves certain assumptions requiring significant judgment and actual results may differ from assumed and estimated amounts.
Previous report
Derivative Financial Instruments and Other Financial Instruments Carried at Fair Value
Previous report
We do not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. We evaluate all of its financial instruments, including the True Up Shares issued in connection with the Subscription Agreement and the Subject Vesting Shares issued in connection with the Business Combination, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 (defined below) and FASB ASC 815, Derivatives and Hedging, or ASC 815. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is reassessed at the end of each reporting period.
Previous report
The True Up Shares issued under the Subscription Agreement do not qualify as equity under ASC 815; therefore, the Class A common stock, or the True Up Shares is required to be classified as a liability and measured at fair value with subsequent changes in fair value recorded in earnings. Changes in the estimated fair value of the derivative liability is recognized as a non-cash gain or loss on the condensed consolidated statements of operations. The fair value of the derivative liability is discussed in Note 11 -Fair Value Measurements.
Previous report
The Subject Vesting Shares liability was an assumed liability of XPDB. The Subject Vesting Shares liability vest and are no longer subject to forfeiture as described in Note 4 -Recapitalization. They do not meet the “fixed-for-fixed” criterion and thus are not considered indexed to the issuer’s stock. As such, management determined that the Subject Vesting Shares should be classified as a liability and recognized at fair value at each reporting period with changes in fair value included in earnings. The estimated fair value of the Subject Vesting Share liability was determined utilizing a Monte Carlo simulation, with underlying forecast mathematics based on geometric Brownian motion in a risk-neutral framework. The calculation of the value of the Subject Vesting Shares considered the $12.00 and $14.00 vesting conditions in addition to the vesting related to the Earnout Milestone Amount. The Subject Vesting Shares liability involves certain assumptions requiring significant judgment and actual results may differ from assumed and estimated amounts. See Note 11 –Fair Value Measurements.
Previous report
Business Combinations
Previous report
We evaluate whether acquired net assets should be accounted for as a business combination or an asset acquisition by first applying a screen test to determine whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If so, the transaction is accounted for as an asset acquisition. If not, we apply judgment to determine whether the acquired net assets meet the definition of a business by considering if the set includes an acquired input, process, and the ability to create outputs.
Previous report
We account for business combinations using the acquisition method of accounting whereby the identifiable assets and liabilities of the acquired business, including contingent consideration, as well as any non-controlling interest in the acquired business, are recorded at their estimated fair values as of the date that we obtain control of the acquired business. We measure goodwill as the fair value of the consideration transferred including the fair value of any non-controlling interest recognized, less the net recognized amount of the identifiable assets and liabilities combined, all measured at their fair value as of the acquisition date. Transaction costs, other than those associated with the issuance of debt or equity securities, that we incur in connection with a business combination are expensed as incurred.
Previous report
Any contingent consideration is measured at fair value at the acquisition date. For contingent consideration that does not meet all the criteria for equity classification, such contingent consideration is required to be recorded at its initial fair value at the acquisition date, and on each balance sheet date thereafter. Changes in the estimated fair value of liability-classified contingent consideration are recognized on the condensed consolidated statements of operations in the period of change.
Previous report
Several valuation methods may be used to determine the fair value of assets acquired and liabilities assumed. For intangible assets, we typically use a variation of the income approach, whereby a forecast of future cash flows attributable to the asset is discounted to present value using a risk-adjusted discount rate. Some of the more significant estimates and assumptions inherent in the income approach include the amount and timing of projected future cash flows, the discount rate selected to measure the risks inherent in the future cash flows, and the assessment of the asset’s expected useful life. When the initial accounting for a business combination has not been finalized by the end of the reporting period in which the transaction occurs, we report provisional amounts. Provisional amounts are adjusted during the measurement period, which does not exceed one year from the acquisition date. These adjustments, or recognition of additional assets or liabilities, reflect new information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that date.
Previous report
Equity Method Investment
Previous report
In accordance with ASC 323, Investments - Equity Method and Joint Ventures, investments in entities over which we do not have a controlling financial interest but has significant influence are accounted for using the equity method, with our share of earnings or losses reported in earnings or losses from equity method investments on the statements of operations.
Previous report
Under the equity method of accounting, our investment is initially recorded at fair value on the condensed consolidated balance sheets. Upon initial investment, we evaluate whether there are basis differences between the carrying value and fair value of our proportionate share of the investee’s underlying net assets. Typically, we amortize basis differences identified on a straight-line basis over the underlying assets’ estimated useful lives when calculating the attributable earnings or losses, excluding the basis differences attributable to in-process research and development and goodwill. If we are unable to attribute all of the basis differences to specific assets or liabilities of the investee, the residual excess of the cost of the investment over the proportional fair value of the investee’s assets and liabilities is considered to be equity method goodwill and is recognized within the equity investment balance, which is tracked separately within our memo accounts. We subsequently record in the statements of operations our share of income or loss of the other entity within other income/expense, which results in an increase or decrease to the carrying value of our investment. If the share of losses exceeds the carrying value of our investment, we will suspend recognizing additional losses and will continue to do so unless we commit to providing additional funding.
Previous report
We evaluate our equity method investments for impairment whenever events or changes in circumstances indicate that a decline in value has occurred that is other than temporary. Evidence considered in this evaluation includes, but would not necessarily be limited to, the financial condition and near-term prospects of the investee, recent operating trends and forecasted performance of the investee, market conditions in the geographic area or industry in which the investee operates and our strategic plans for holding the investment in relation to the period of time expected for an anticipated recovery of its carrying value. If the investment is determined to have a decline in value deemed to be other than temporary it is written down to estimated fair value.
Previous report
Additionally, if an equity method investee recognizes a goodwill impairment charge in its separate financial statements, we will recognize its share of the impairment in its financial statements in the same manner in which it recognizes other earnings of the investee.
Previous report
We determine the accounting classification of warrants issued as either liability or equity classified by first assessing whether the warrants meet liability classification in accordance with ASC 480-10, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, or ASC 480, then in accordance with ASC 815-40, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock, or ASC 815. In order for a warrant to be classified in stockholders’ deficit, the warrant must be (i) indexed to our equity and (ii) meet the conditions for equity classification.
Previous report
If a warrant does not meet the conditions for stockholders’ equity (deficit) classification, it is carried on the condensed consolidated balance sheets as a warrant liability measured at fair value, with subsequent changes in the fair value of the warrant recorded in other non-operating losses (gains) in the condensed consolidated statements of operations. If a warrant meets both conditions for equity classification, the warrant is initially recorded, at its relative fair value on the date of issuance, in stockholders’ deficit in the condensed consolidated balance sheets, and the amount initially recorded is not subsequently remeasured at fair value.
Previous report
Income Taxes
Previous report
Prior to the Business Combination on March 14, 2024, we were a limited liability company, or LLC, and treated as a partnership for income tax purpose. As a Partnership, we were not directly liable for federal income taxes. As of the date of the Business Combination, the operations of the Company ceased to be taxed as a partnership resulting in a change in tax status for federal and state income tax purposes.
Previous report
We follow the asset and liability method of accounting for income taxes under ASC 740, Income Taxes, or ASC 740. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that is included in the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
Previous report
ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. We recognize accrued interest and penalties related to unrecognized tax benefits as income tax expense. Management has evaluated our tax positions, including our Predecessor's previous status as a pass-through entity for federal and state tax purposes, and has determined that we have taken no uncertain tax positions that require adjustment to the condensed consolidated financial statements. Our reserves related to uncertain tax positions was zero as of March 31, 2025 and December 31, 2024. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2025 and December 31, 2024. We are currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.
Reworded paragraphs (32)
Previous wording
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our unaudited condensed consolidated financial statements for the three months ended March 31, 2025 and 2024, and our audited financial statements as of the year ended December 31, 2024, included in Form 8-K filed with the SEC on March 25, 2025
Current wording
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes appearing in this Quarterly Report on Form 10-Q, as well as the audited financial statements, notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2024.
Previous wording
Unless the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “we”, “us”, “our”, and the “Company” are intended to refer to (i) following the Business Combination (as defined below), the business and operations of AirJoule Technologies Corporation, formerly known as Montana Technologies Corporation and its consolidated subsidiaries, and (ii) prior to the Business Combination, AirJoule Technologies LLC, formerly known as Montana Technologies LLC, or Predecessor, (the predecessor entity in existence prior to the consummation of the Business Combination) and its consolidated subsidiaries.
Current wording
Unless the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “we”, “us”, “our”, and the “Company” are intended to refer to (i) following the Business Combination (as defined below), the business and operations of AirJoule Technologies Corporation, formerly known as Montana Technologies Corporation and its consolidated subsidiaries, and (ii) prior to the Business Combination, AirJoule Technologies LLC, formerly known as Montana Technologies LLC, or Legacy Montana, and its consolidated subsidiaries.
Previous wording
We are a water technology company that aims to provide energy and cost-efficient water harvested from air. Our product, AirJoule, is a climate solution technology that separates water from air and produces pure distilled water to improve water security and sustainability for businesses and consumers around the world. AirJoule is especially valuable for industrial users, which generate significant amounts of waste heat that can be utilized to produce pure distilled water and dehumidified air – two key inputs for a variety of industrial activities, including data centers and advanced manufacturing. In HVAC applications, our AirJoule technology is designed to reduce energy consumption, minimize or even eliminate the use of environmentally-harmful refrigerants, and generate material cost efficiencies for air conditioning systems. We are focused on commercialization and scaling manufacturing of our AirJoule systems through our global collaborations with GE Vernova and Carrier, and we believe that deploying AirJoule units worldwide can help to improve water security and reduce global emissions. We plan to manufacture AirJoule units capable of producing more than 1,000 liters per day in 2025, which we intend to use for customer demonstrations, and we expect to scale capacities for commercial sales in 2026.
Current wording
We are an advanced technology company whose purpose is to free the world from its water and energy constraints by delivering groundbreaking sorption technologies. AirJoule is the leading technology platform that unleashes the power of water from air. AirJoule produces pure distilled water from air, and our proprietary AirJoule platform, at commercial scale, will mitigate water scarcity through distributed water generation for businesses and consumers around the world. Our products are especially valuable for industrial users, which generate significant amounts of waste heat that can be used to power our sorption technologies to produce low cost pure distilled water and dehumidified air – two key inputs for a variety of industrial activities, including data centers and advanced manufacturing. In HVAC applications, AirJoule is designed to reduce energy consumption, minimize or even eliminate the use of environmentally-harmful refrigerants, and generate material cost efficiencies for air conditioning systems. We are focused on commercialization and scaling manufacturing of our AirJoule products through our global collaborations, including with GE Vernova and Carrier, and we believe that deploying AirJoule units worldwide will serve our purpose of freeing the world of its water and energy constraints. We plan to manufacture initial AirJoule systems capable of producing more than 1,000 liters per day in 2025, which we intend to use for customer demonstrations, and we expect to scale capacities for commercial sales in 2026.
Previous wording
We anticipate significant growth opportunities by offering AirJoule in global markets where demand for water, dehumidified air and cooling are highest. With our proprietary technology, we believe that we are uniquely positioned to provide curated solutions that satisfy our customers’ needs and expectations in fast-growing and water and energy-intensive industries, such as data centers and advanced manufacturing, along with military and HVAC applications. We estimate the combined total addressable market to be approximately $450 billion.
Current wording
We anticipate significant growth opportunities by offering AirJoule in global markets where demand for water, dehumidified air and cooling are highest. With our technology platform, we believe that we are uniquely positioned to provide curated solutions that satisfy our customers’ needs and expectations in fast-growing and water and energy-intensive industries, such as data centers and advanced manufacturing, along with military and HVAC applications. We estimate the combined total addressable market to be approximately $450 billion.
Previous wording
To accelerate market penetration and scale our manufacturing capabilities, we plan to leverage our strategic partnerships, which are discussed below. These partnerships offer access to industry-specific R&D expertise, mature supply chains, established sales channels, and extensive service networks, allowing us to quickly move from pilot deployments to full-scale commercialization. We intend to co-develop sector-specific solutions, capitalizing on our partners’ market insights and reputational strength to better serve diverse customer needs. By combining our innovative AirJoule technology with their global reach and operational expertise, we will unlock value across multiple industries, establish our position as a leader in water-focused solutions, and deliver long-term growth and value to our shareholders.
Current wording
To accelerate market penetration and scale our manufacturing capabilities, we plan to leverage our strategic partnerships. These partnerships offer access to industry-specific R&D expertise, mature supply chains, established sales channels and extensive service networks, allowing us to quickly move from pilot deployments to full-scale commercialization. We intend to co-develop sector-specific solutions, capitalizing on our partners’ market insights and reputational strength to better serve diverse customer needs. By combining our innovative AirJoule technology with their global reach and operational expertise, we will unlock value across multiple industries, establish our position as a leader in water-focused solutions and deliver long-term growth and value to our shareholders.
Previous wording
On March 25, 2025, we entered into the Equity Line Purchase Agreement with the Equity Line Investor. Under the terms and subject to the conditions of the Equity Line Purchase Agreement, the Company has the right, but not the obligation, to sell to the Equity Line Investor, over a 36-month period, up to an aggregate of $30,000,000 of our newly issued common stock subject to certain conditions and limitations contained in the Equity Line Purchase Agreement, including that we may issue no more than the number of shares equal to 19.99% of the aggregate number of our issued and outstanding shares of common stock as of immediately prior to the execution of the Equity Line Purchase Agreement without first obtaining stockholder approval. As of March 31, 2025, sales under the Equity Line Purchase Agreement had not yet commenced.
Current wording
On March 25, 2025, we entered into the Equity Line Purchase Agreement, with the Equity Line Investor. Under the terms and subject to the conditions of the Equity Line Purchase Agreement, the Company has the right, but not the obligation, to sell to the Equity Line Investor, over a 36-month period, up to an aggregate of $30,000,000 of our newly issued shares of common stock subject to certain conditions and limitations contained in the Equity Line Purchase Agreement, including that we may issue no more than the number of shares equal to 19.99% of the aggregate number of our issued and outstanding shares of common stock as of immediately prior to the execution of the Equity Line Purchase Agreement without first obtaining stockholder approval. As of June 30, 2025, sales under the Equity Line Purchase Agreement had not yet commenced.
Previous wording
The three months ended March 31, 2025 compared to the three months ended March 31, 2024
Current wording
The three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024
Previous wording
The following table sets forth the Company’s condensed consolidated statements of operations data for the three months ended March 31, 2025 and 2024:
Current wording
The following table sets forth the Company’s condensed consolidated statements of operations data for the three and six months ended June 30, 2025 and 2024:
Previous wording
General and administrative expenses for the three months ended March 31, 2025 was $2.8 million as compared to $0.8 million for the three months ended March 31, 2024. The $2.0 million increase was primarily related to increases in professional services such as legal, audit and accounting services offset by the reimbursement of costs incurred per the statement of work with AirJoule, LLC. We expect that our general and administrative expenses will increase in future periods commensurate with the expected growth of our business and increased expenditures associated with our status as an exchange-listed public company.
Current wording
General and administrative expenses for the three months ended June 30, 2025 were $3.8 million as compared to $3.2 million for the three months ended June 30, 2024. The $0.5 million increase was primarily related to a $1.4 million increase in share-based compensation expense, a $0.4 million increase in professional services and a $0.3 million increase in salaries and benefits as a result of an increased headcount offset by a $0.6 million decrease in audit and legal fees, a $0.6 million decrease in expenses related to public company activity including insurance, director fees and licensing fees and the reimbursement of costs incurred per the statement of work with AirJoule, LLC of $0.4 million. We expect that our general and administrative expenses will increase in future periods commensurate with the expected growth of our business and increased expenditures associated with our status as an exchange-listed public company.
Previous wording
Research and development expenses for the three months ended March 31, 2025 was $0.4 million as compared to $0.8 million for the three months ended March 31, 2024. The $0.5 million decrease in research and development was primarily related to the reimbursement of costs incurred per the statement of work with AirJoule, LLC, partially offset by an increase in personnel and prototype related costs as the Company continues to develop its products and technology. We expect that our research and development expenses will increase in future periods commensurate with the expected growth of our business.
Current wording
Research and development expenses for the three months ended June 30, 2025 were $0.4 million as compared to $1.1 million for the three months ended June 30, 2024. The $0.6 million decrease in research and development was primarily related to a $0.2 million increase in share-based compensation and salaries and benefits as a result of an increased headcount offset by a $0.6 million decrease in purchasing of research and development materials, patent fees and consulting services and the reimbursement of costs incurred per the statement of work with AirJoule, LLC of $0.1 million.
Previous wording
Transaction costs incurred in connection with the business combination include the non-cash recognition of earnout liabilities of approximately $53.7 million and transaction costs incurred by our Predecessor of approximately $1.0 million, which were paid in 2024.
Current wording
Transaction costs incurred in connection with the business combination include the non-cash recognition of earnout liabilities of approximately $53.7 million and transaction costs incurred by Legacy Montana of approximately $1.0 million, which were paid in 2024.
Previous wording
Depreciation and amortization expense for the three months ended March 31, 2025 and 2024 was $1,588 and $1,085, respectively.
Current wording
Depreciation and amortization expense for the three months ended June 30, 2025 and 2024 was $2,289 and $1,216, respectively.
Previous wording
Interest income was $243,024 and $26,146 for the three months ended March 31, 2025 and 2024, respectively. This is a result of the increase in our cash balance.
Current wording
Interest income was $283,733 and $216,480 for the three months ended June 30, 2025 and 2024, respectively. This is primarily a result of the increase in our cash balance.
Previous wording
An equity method investment received in exchange for noncash consideration is measured at fair value. As a result, for the three months ended March 31, 2024, we recognized a gain of $333.5 million on the contribution to AirJoule, LLC for the difference between our zero carrying value and the fair value of the perpetual license to intellectual property that we transferred to AirJoule, LLC.
Current wording
An equity method investment received in exchange for noncash consideration is measured at fair value. As a result, during the three and six months ended June 30, 2024, we recognized a gain of $333.5 million on the contribution to AirJoule, LLC for the difference between our zero carrying value and the fair value of the perpetual license to intellectual property that we transferred to AirJoule, LLC.
Previous wording
As previously noted, on January 25, 2024, the Predecessor entered into a joint venture with GE Ventures LLC, the AirJoule JV which closed on March 4, 2024. For the three months ended March 31, 2025 and for the period from March 4, 2024 to March 31, 2024, we recognized a loss of $2.2 million and $26,382, respectively from our 50% equity investment in the AirJoule JV.
Current wording
As previously noted, on January 25, 2024, Legacy Montana entered into a joint venture with GE Vernova, the AirJoule JV which closed on March 4, 2024. For the three months ended June 30, 2025 and 2024, we recognized a loss of $2.1 million and $0.6 million, respectively from our 50% equity investment in the AirJoule JV. For the six months ended June 30, 2025 and 2024, we recognized a loss of $4.3 million and $0.6 million, respectively from our 50% equity investment in the AirJoule JV.
Previous wording
Upon consummation of the Business Combination, we expensed approximately $53.7 million in Earnout Shares liability. The change in fair value of $12.8 million and $(7.7) million for the three months ended March 31, 2025 and 2024, respectively, is due to a decrease in the estimated fair value of the liability and is recognized as a gain in the condensed consolidated statements of operations. The fair value of the liability decreased primarily due changes in the valuation inputs, mainly a decrease in the stock price, changes in the timing of future cash flows and an increase in the volatility.
Current wording
Upon consummation of the Business Combination, we expensed approximately $53.7 million in Earnout Shares liability. The change in fair value of $6.3 million and $13.1 million for the three months ended June 30, 2025 and 2024, respectively, and $19.1 million and $5.4 million for the six months ended June 30, 2025 and 2024, respectively, is primarily due to a decrease in the estimated fair value of the liability and is recognized as gains in the condensed consolidated statements of operations. The fair value of the liability decreased primarily due changes in the valuation inputs, mainly a decrease in the stock price, changes in the timing of expected future cash flows and an increase in the volatility.
Previous wording
Upon consummation of the Business Combination, we assumed approximately $0.6 million in earnout true up shares liability. The change in fair value of the liability of $0.1 million and $0.3 million during the three months ended March 31, 2025 and 2024, respectively, is due to the triggering event and issuance of Class A common stock.
Current wording
Upon consummation of the Business Combination, we assumed approximately $0.6 million in earnout true up shares liability. The change in fair value of the liability during the three and six months ended June 30, 2025 is primarily due to the triggering event and issuance of Class A common stock.
Previous wording
Upon consummation of the Business Combination, we assumed approximately $11.8 million for the subject vesting shares liability. The change in fair value of income of $5.5 million and $(2.4) million during the three months ended March 31, 2025 and 2024, respectively, is due to a decrease in the estimated fair value of the liability recognized as a gain in the condensed consolidated statements of operations. The fair value of the liability decreased primarily due changes in the valuation inputs, mainly a decrease in the stock price, changes in the timing of future cash flows and an increase in the volatility.
Current wording
Upon consummation of the Business Combination, we assumed approximately $11.8 million for the subject vesting shares liability. The change in fair value of income of $0.9 million and $1.8 million during the three months ended June 30, 2025 and 2024, respectively, and $6.4 million and $(0.7) million during the six months ended June 30, 2025 and 2024, respectively is primarily due to a decrease in the estimated fair value of the liability recognized as a gain (loss) in the condensed consolidated statements of operations. The fair value of the liability decreased primarily due changes in the valuation inputs, mainly a decrease in the stock price, changes in the timing of expected future cash flows and an increase in the volatility.
Previous wording
For the three months ended March 31, 2025 and 2024, income tax benefit (expense) was $1.6 million and $(85.7) million, respectively. During the three months ended March 31, 2024, our contribution of a perpetual license to AirJoule, LLC’s intellectual property was measured at fair value resulted in a book gain and a temporary difference between book and taxable income. The temporary difference resulted in the recognition of a deferred tax expense and deferred tax liabilities of approximately $87.8 million. This expense was partially offset by the recognition of deferred tax assets in connection with the Company now being a corporation through the Business Combination.
Current wording
For the three months ended June 30, 2025 and 2024, income tax benefit was $1.6 million and $1.2 million, respectively. For the six months ended June 30, 2025 and 2024, income tax benefit (expense) was $3.2 million and $(84.5) million, respectively. During the three and six months ended June 30, 2024, our contribution of a perpetual license to AirJoule, LLC’s intellectual property was measured at fair value resulted in a book gain and a temporary difference between book and taxable income. The temporary difference resulted in the recognition of a deferred tax expense and deferred tax liabilities of approximately $87.8 million. This expense was partially offset by the recognition of deferred tax assets in connection with the Company now being a corporation through the Business Combination.
Previous wording
On March 25, 2025, we entered into a common stock purchase agreement, or the Equity Line Purchase Agreement, with B. Riley Principal Capital II, LLC, or the Equity Line Investor. Under the terms and subject to the conditions of the Equity Line Purchase Agreement, the Company has the right, but not the obligation, to sell to the Equity Line Investor, over a 36-month period, up to an aggregate of $30,000,000 of our newly issued common stock subject to certain conditions and limitations contained in the Equity Line Purchase Agreement, including that we may issue no more than the number of shares equal to 19.99% of the aggregate number of our issued and outstanding shares of common stock as of immediately prior to the execution of the Equity Line Purchase Agreement without first obtaining stockholder approval. As of March 31, 2025, sales under the Equity Line Purchase Agreement had not yet commenced.
Current wording
On March 25, 2025, we entered into the Equity Line Purchase Agreement with the Equity Line Investor. Under the terms and subject to the conditions of the Equity Line Purchase Agreement, the Company has the right, but not the obligation, to sell to the Equity Line Investor, over a 36-month period, up to an aggregate of $30,000,000 of our newly issued shares of common stock subject to certain conditions and limitations contained in the Equity Line Purchase Agreement, including that we may issue no more than the number of shares equal to 19.99% of the aggregate number of our issued and outstanding shares of common stock as of immediately prior to the execution of the Equity Line Purchase Agreement without first obtaining stockholder approval. As of June 30, 2025, sales under the Equity Line Purchase Agreement had not yet commenced.
Previous wording
Pursuant to the A&R Joint Venture Agreement, we are expected to contribute additional capital to the AirJoule JV based on a business plan and annual operating budgets to be agreed between us and GE Vernova. In February 2025, we contributed an additional $5.0 million in capital contributions to the AirJoule JV.
Current wording
Pursuant to the A&R Joint Venture Agreement, we are expected to contribute additional capital to the AirJoule JV based on a business plan and annual operating budgets to be agreed between us and GE Vernova. During the six months ended June 30, 2025, we contributed an additional $10.0 million in capital contributions to the AirJoule JV.
Previous wording
Our primary sources of liquidity have been cash from contributions from founders or equity capital raised from other investors. We had retained earnings of approximately $213.4 million as of March 31, 2025. As of March 31, 2025, we had $22.8 million of working capital including $23.0 million in cash, cash equivalents and restricted cash.
Current wording
Our primary sources of liquidity have been cash from contributions from founders or equity capital raised from other investors. We had retained earnings of approximately $215.9 million as of June 30, 2025. As of June 30, 2025, we had $29.5 million of working capital including $30.5 million in cash, cash equivalents and restricted cash.
Previous wording
Our future capital requirements will depend on many factors, including the timing and extent of spending to support the launch of our product and research and development efforts, the degree to which we are successful in launching new business initiatives and the cost associated with these initiatives, and the growth of our business generally. Pursuant to the A&R Joint Venture Agreement, we contributed $10 million in cash to the AirJoule JV at the JV closing and in June 2024, GE Vernova contributed $100 to the AirJoule JV. We have also agreed to contribute up to an additional $90.0 million in capital contributions to the AirJoule JV based on a business plan and annual operating budgets to be agreed between the Company and GE Vernova. In general, for the first six years, GE Vernova has the right, but not the obligation, to make capital contributions to the AirJoule JV.
Current wording
Our future capital requirements will depend on many factors, including the timing and extent of spending to support the launch of our product and research and development efforts, the degree to which we are successful in launching new business initiatives and the cost associated with these initiatives and the growth of our business generally. Pursuant to the A&R Joint Venture Agreement, we contributed $10 million in cash to the AirJoule JV at the JV closing and in June 2024, GE Vernova contributed $100 to the AirJoule JV. Pursuant to the A&R Joint Venture Agreement, we agreed to make additional capital contributions to the AirJoule JV based on a business plan and annual operating budgets to be agreed between the Company and GE Vernova, and our remaining commitment for capital contributions to the AirJoule JV is $85.0 million as of June 30, 2025. In general, for the first six years, GE Vernova has the right, but not the obligation, to make capital contributions to the AirJoule JV.
Previous wording
Cash flows for the three months ended March 31, 2025 and 2024
Current wording
Cash flows for the six months ended June 30, 2025 and 2024
Previous wording
The following table summarizes our cash flows from operating, investing and financing activities for the three months ended March 31, 2025 and 2024:
Current wording
The following table summarizes our cash flows from operating, investing and financing activities for the six months ended June 30, 2025 and 2024:
Previous wording
During the three months ended March 31, 2024, net cash used in investing activities was $10.0 million as a result of the contribution made to AirJoule, LLC.
Current wording
During the six months ended June 30, 2025, net cash used in investing activities was $10.0 million primarily as a result of our $10 million contribution made to the AirJoule JV.
Previous wording
During the three months ended March 31, 2025, net cash used in investing activities was $5.1 million as a result of the Company’s contribution made to AirJoule, LLC.
Current wording
During the six months ended June 30, 2024, net cash used in investing activities was $10.0 million primarily as a result of our $10 million contribution made to the AirJoule JV.
Previous wording
During the three months ended March 31, 2024, net cash provided by financing activities was $43.5 million and was primarily related to proceeds from the issuance of the Predecessor common stock related to private placements prior to the Merger, and the exercise of stock options and warrants.
Current wording
During the six months ended June 30, 2024, net cash provided by financing activities was $61.9 million and was primarily related to the $61.8 million net proceeds from the issuance of common stock related to private placements prior to the Merger, and $0.1 million of proceeds from the exercise of stock options and warrants.
Previous wording
In October 2021, we entered into a patent license agreement with a third party whereby the third party granted us rights to use certain of their patents in exchange for an upfront payment and royalties based on a percentage of net sales until such patents expire. In connection with this, we agreed to a minimum royalty amount of which $75,000 and $62,500 was expensed for the three months ended March 31, 2025 and 2024, respectively. At March 31, 2025 and December 31, 2024, $75,000 and $0.3 million, respectively, was accrued in the accompanying condensed consolidated balance sheets.
Current wording
In October 2021, we entered into a patent license agreement with a third party whereby the third party granted us rights to use certain of their patents in exchange for an upfront payment and royalties based on a percentage of net sales until such patents expire. In connection with this, the Company agreed to a minimum royalty amount of which $75,000 and $62,500 was expensed for the three months ended June 30, 2025 and 2024, respectively and $150,000 and $125,000 for the six months ended June 30, 2025 and 2024. At June 30, 2025 and December 31, 2024, $150,000 and $250,000, respectively, was accrued in the accompanying condensed consolidated balance sheets.
Previous wording
Pursuant to the Amended and Restated Joint Venture Agreement for CAMT, entered into on September 29, 2023, our Predecessor and CATL US have each agreed to contribute $6.0 million to CAMT. Contributions will be requested by CAMT once a business plan and operating budget is set by CAMT’s board of directors. No action to establish a business plan or operating budget has occurred to date. Any additional financing beyond the initial $12.0 million (i.e., $6.0 million from each of the Predecessor and CATL US) will be subject to the prior mutual agreement of the Predecessor and CATL US. CAMT is managed by a four-member board of directors, with two directors (including the chairman) designated by CATL US and two directors (including the vice chairman) designated by the Predecessor. In the event of an equal vote, the chairman may cast the deciding vote. Certain reserved matters, including debt issuances exceeding $5.0 million in a single transaction or in aggregate within a fiscal year, amendments to CAMT’s constitutional documents the annual financial budget of CAMT, and any transaction between CAMT and CATL US or the Predecessor in an amount exceeding $10.0 million in a single transaction or in aggregate within a fiscal year, require the unanimous vote of both CATL US and the Predecessor or all directors. As of March 31, 2025, we have not funded this joint venture or contributed any assets to the joint venture.
Current wording
Pursuant to the Amended and Restated Joint Venture Agreement for CAMT, entered into on September 29, 2023, Legacy Montana and CATL US have each agreed to contribute $6.0 million to CAMT. Contributions will be requested by CAMT once a business plan and operating budget is set by CAMT’s board of directors. No action to establish a business plan or operating budget has occurred to date. Any additional financing beyond the initial $12.0 million (i.e., $6.0 million from each of Legacy Montana and CATL US) will be subject to the prior mutual agreement of Legacy Montana and CATL US. CAMT is managed by a four-member board of directors, with two directors (including the chairman) designated by CATL US and two directors (including the vice chairman) designated by Legacy Montana. In the event of an equal vote, the chairman may cast the deciding vote. Certain reserved matters, including debt issuances exceeding $5.0 million in a single transaction or in aggregate within a fiscal year, amendments to CAMT’s constitutional documents the annual financial budget of CAMT, and any transaction between CAMT and CATL US or Legacy Montana in an amount exceeding $10.0 million in a single transaction or in aggregate within a fiscal year, require the unanimous vote of both CATL US and Legacy Montana or all directors. As of June 30, 2025, we have not funded this joint venture or contributed any assets to the joint venture.
Previous wording
The purpose of our Predecessor’s joint venture with CATL US is to commercialize our AirJoule technology in Asia and Europe and, pursuant to the Amended and Restated Joint Venture Agreement for CAMT, CAMT has the exclusive right to commercialize AirJoule technology in those territories. Subject to the oversight of CAMT’s board, CATL US is responsible for managing the day-to-day operations of CAMT (including the nomination and replacement of the Chief Executive Officer of CAMT), and is responsible for providing CAMT and any subsidiaries formed by CAMT with, among other things, administrative services, supply chain support, assistance in obtaining required permits and approvals and assistance in purchasing or leasing land and equipment.
Current wording
The purpose of Legacy Montana’s joint venture with CATL US is to commercialize our AirJoule technology in Asia and Europe and, pursuant to the Amended and Restated Joint Venture Agreement for CAMT, CAMT has the exclusive right to commercialize AirJoule technology in those territories. Subject to the oversight of CAMT’s board, CATL US is responsible for managing the day-to-day operations of CAMT (including the nomination and replacement of the Chief Executive Officer of CAMT), and is responsible for providing CAMT and any subsidiaries formed by CAMT with, among other things, administrative services, supply chain support, assistance in obtaining required permits and approvals and assistance in purchasing or leasing land and equipment.
Previous wording
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Current wording
There have been no material changes to the critical accounting policies as disclosed in “Part I—Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Estimates” in our Quarterly Report on Form 10-Q for the three months ended March 31, 2025.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
On April 25, 2025, we entered into the Amended LLC Agreement, pursuant to which we expected to contribute additional capital to the AirJoule JV based on a business plan and annual operating budgets to be agreed between us and GE Vernova. In July 2025, we contributed an additional $2.75 million in capital contributions to the AirJoule JV.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
During the three months ended March 31, 2025, net cash provided by financing activities was $41,760 and was related to the exercise of stock options.