AleAnna, Inc.
For the period ended Mar 31, 2026. Filed May 14, 2026.
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.
Mar 31, 2026 · Filed May 14, 2026
ANNA$2.04+4.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-12.
0001213900-25-109195
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-14.
0001213900-26-056693
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 98 previous paragraphs and 97 current paragraphs.
49 unchanged; 25 reworded; 22 added; 23 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 9 previous and 24 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 (22)
Current report
Cautionary Note Regarding Forward-Looking Statements
Current report
This Quarterly Report on Form 10-Q (“Form 10-Q”) contains forward-looking statements that involve substantial risks and uncertainties within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. All statements other than statements of historical facts contained in this Form 10-Q, including statements regarding the Company’s future financial position, business strategy and plans and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other similar expressions.
Current report
Forward-looking statements involve a number of risks, uncertainties and assumptions, and actual results or events may differ materially from those projected or implied in those statements. Important factors that could cause such differences include, but are not limited to:
Current report
For a more detailed discussion of these and other factors that may affect our business and that could cause the actual results to differ materially from those anticipated in forward-looking statements, see “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025, and Part II, Item 1A “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q.
Current report
During thethree months ended March 31, 2026, we generated approximately $9.3 million of total revenue, comprised of $8.9 million of revenue from our Conventional segment and $0.4 million of revenue from our Renewable segment.
Current report
Total revenues increased by $8.7 million, or 1350%, for the three months ended March 31, 2026 to $9.3 million compared to $0.7 million for the three months ended March 31, 2025, primarily driven by sustained production at the five wells in the Longanesi field, which began production in 2025. Cost of revenues increased by $0.7 million, or 85% to $1.6 million for the three months ended March 31, 2026, compared to $0.8 million for the three months ended March 31, 2025, primarily driven by increased production costs from the Longanesi field.
Current report
Lease Operating Expenses
Current report
Lease operating expense was $1.3 million for the three months ended March 31, 2026 due to the lease of the temporary facility used in the Longanesi field. We did not incur any lease operating expense for the three months ended March 31, 2025.
Current report
Depreciation and Depletion
Current report
Depreciation and depletion increased by $1.1 million, or 1512% to $1.2 million for the three months ended March 31, 2026, compared to $0.1 million for the three months ended March 31, 2025. As of March 31, 2025, the Longanesi field had not commenced production.
Current report
Accretion and remeasurement of asset retirement obligation
Current report
The decrease in expense from the prior-year period is primarily due to favorable income statement impact of $0.6 million from a downward remeasurement of the ARO based on revised technical assessments of decommissioning cost and timing for certain wells. See Note 8 to the condensed consolidated financial statements for further details.
Current report
Interest and Other Income
Current report
Non-GAAP Financial Measures
Current report
In addition to amounts presented in accordance with accounting principles generally accepted in the United States (“GAAP”), we also present certain supplemental non-GAAP financial measures. We believe that the presentation of non-GAAP financial measures provides both management and investors with a greater understanding of our operating results and trends in addition to the results measured in accordance with GAAP and provides greater comparability across time periods. These measures should not be considered a substitute to GAAP basis measures, nor should they be viewed as a substitute for operating results determined in accordance with GAAP. The non-GAAP financial measures do not have any standardized meaning and are therefore unlikely to be comparable to similarly titled measures used by other companies. In compliance with GAAP, our non-GAAP measures are reconciled to net income, the most directly comparable GAAP performance measure.
Current report
EBITDA and Adjusted EBITDA
Current report
EBITDA is a supplemental non-GAAP financial measure defined as net income (loss) adjusted for interest and other income, income taxes, depreciation, depletion, and amortization. Our definition of Adjusted EBITDA differs from EBITDA because we further adjust non-GAAP EBITDA for stock-based compensation expense and the remeasurement of asset retirement obligation, and other one-off activity, when applicable. The purpose of presenting Adjusted EBITDA is to adjust for items that we do not believe represent the operations of the core business such as transactions expenses, share-based compensation, and other non-recurring costs.
Current report
The following table is a reconciliation of net income to EBITDA and Adjusted EBITDA:
Current report
We have begun generating revenue from our operations. We had an accumulated deficit of $187.2 million as of March 31, 2026. We had $31.1 million in unrestricted cash and cash equivalents as of March 31, 2026 and generated cash flows from operations of $2.9 million for the three months ended March 31, 2026. Management believes that existing cash on hand, together with expected cash flows from operations, will be sufficient to meet the Company’s operating expenses and support continued growth for at least the next 12 months.
Current report
Cash flows from operating activities
Current report
Cash flows from investing activities
Current report
Cash flows from financing activities
Removed paragraphs (23)
Previous report
This discussion and analysis contains forward-looking statements that reflect our plans, estimates and beliefs that involve risks and uncertainties that may be outside our control. Actual results may differ materially from those anticipated in these forward-looking statements**as a result of various factors, including those set for under “Risk Factors” in our Annual Report on Form 10-K. Unless the context otherwise requires, all references in this section to “we,” “us,” “our,” “AleAnna,” or the “Company” refer to AleAnna, Inc.
Previous report
Gas Sale Agreement
Previous report
On October 29, 2024, we entered into a gas sale agreement (“GSA”) with Shell Energy Europe Limited (“SEEL”), under which SEEL became the exclusive buyer of our share of the natural gas produced from the Longanesi field net of (i) any consumption and/or losses incurred in the transport, treatment and compression of gas before delivery; (ii) any volume to be allocated for regulated royalties auctions, if applicable; and (iii) any other volume contractually allocated to other parties before August 31, 2022.
Previous report
Expanding Renewable Natural Gas Operations
Previous report
We believe expanding the renewable natural gas business is another key to our potential growth and may unlock potential partnership or joint venture opportunities.
Previous report
During both the three and nine months ended September 30, 2025, we generated approximately $10.6 million and $13.9 million of revenue from sales of our share of natural gas from the Longanesi field. Results from the Longanesi field have been above expectations, with a stabilized production rate of approximately 28 million cubic feet per day (“MMcf/d”), which was achieved ahead of the anticipated 3-month ramp up timeline for this milestone.
Previous report
Lease Operating Expenses and Depreciation and Depletion
Previous report
Refer to the descriptions of lease operating expenses and depreciation and depletion provided in the “Expenses” section above. As of September 30, 2024, the Longanesi field had not commenced production. The Casalino and Campopiano plants were acquired during the third quarter of 2024. Accordingly, period-over-period comparisons for these expense categories are not meaningful.
Previous report
As of September 30, 2025 and December 31, 2024, the contingent consideration liability was recorded at $28.1 million and $25.0 million, respectively. The estimate of the contingent consideration liability was determined based on inputs including the following as of September 30, 2025 and December 31, 2024: the intercontinental exchange futures prices for European natural gas, Euro to USD exchange rates of 1.17 and 1.04, respectively, and management’s future expected annual Longanesi production. We are required to make formulaic deferred consideration payments effectively equating to 20% to 50% of revenue above certain European natural gas threshold prices. The calculation and timing of such payments are primarily driven by future expected Longanesi production, as modeled by DeGolyer, as well as forward European natural gas prices. While the timing and quantities of expected Longanesi production were unchanged from December 31, 2024 to September 30, 2025, and we had fully accrued the total capped Euro amount of the liability, average annual European natural gas forward prices declined slightly.
Previous report
Since the total capped Euro-denominated liability was recorded as of September 30, 2025 and December 31, 2024, and September 30, 2024 and December 31, 2023, any changes in the USD-equivalent amount were entirely due to foreign exchange rate fluctuations. As such, these changes were included in currency translation adjustment for the three and nine months ended September 30, 2025 and 2024.
Previous report
Interest and Other Income (Expenses)
Previous report
Change in Fair Value of Derivative Liability
Previous report
The change in the fair value of derivative liability related to the Class 1 Preferred Units was nil during the three and nine months ended September 30, 2025, compared to nil during the three months ended September 30, 2024 and $0.2 million during the nine months ended September 30, 2024. The fair value gain recorded during the nine months ended September 30, 2024 (representing a decrease in the liability) was primarily due to a higher liquidation threshold which was driven by capital contributions made during the first quarter of 2024 through the Class 1 Preferred Units. The derivative liability was reduced from $0.2 million as of December 31, 2023 to zero during the first quarter of 2024 and was ultimately derecognized in conjunction with the Business Combination.
Previous report
Cash generated (used) used in operating activities
Previous report
Cash used in investing activities
Previous report
Cash provided by financing activities
Previous report
Cash provided by financing activities during the nine months ended September 30, 2024 reflects pre-Business Combination issuances of AleAnna Energy Class 1 Preferred Units used to fund our operations. Such Class 1 Preferred Units were exchanged for Class A and Class C commons stock as part of the Business Combination.
Previous report
Participation Agreements and Blugas ORRI
Previous report
In the normal course of business, we enter into agreements with other entities to assist in the performance of drilling of the Longanesi field. On June 26, 2009, we entered into a Participation Agreement with Padana for the drilling of the ‘Longanesi 1 exploration well, ’San Potito’ concession and ‘Abbadessee 1’ exploration,’ collectively referred to as the Longanesi field.
Previous report
The Unified Operating Agreement arrangement was originally signed between Eni and Grove and dated September 26, 2009. However, Padana has succeeded Eni as the operator and 66.5% working interest owner, and we succeeded Grove as the non-operator and 33.5% working interest owner. On July 13, 2016, we acquired a 33.5% working interest in the Longanesi field from Enel, and, as part of the purchase, acquired a legacy contingent liability arising from an agreement between the Longanesi working interest’s original owner Grove Energy and Blugas. Blugas retained an interest akin to an ORRI, whereby Blugas was entitled to physical delivery of 20% of the first 350 million standard cubic meters (approximately 2,472 106 ft 3) produced from the Longanesi field. Prior to the Blugas settlement in May 2024 (as further described below), in accounting for the acquisition of the 33.5% working interest, we did not recognize an asset or liability in the consolidated financial statements related to the Blugas ORRI as our SEC Case reserves estimates contemplated the contractual arrangement and physical gas delivery to Blugas, such that the gas revenues attributable to our 33.5% working interest were reduced to reflect sale of the Blugas quantity and payment of such revenues (cash outflows to Blugas).
Previous report
The physical volumes due to Blugas were being contested by us as usury because we considered, among other reasons, that extraction services and all associated risks are executed by us and that participation by Blugas was limited to financing a part of the sum necessary to start drilling, without participation in the construction and exploitation of the reservoir, and therefore do not share the risks or costs, which had increased compared to the initial forecast of the investment.
Previous report
On May 28, 2024, we entered into the Blugas Settlement Agreement regarding the Blugas ORRI whereby Blugas was entitled to physical delivery of 20% of the first 350 million standard cubic meters (approximately 2,472 106 ft 3) produced from the Longanesi field. Under the terms of the Blugas Settlement Agreement, we paid Blugas approximately €5 million, plus an additional €1.1 million in applicable VAT, or a total of approximately $6.6 million. In exchange, we were released from any future liability related to the Blugas ORRI. As a result of the transactions contemplated by the Blugas Settlement Agreement, our 33.5% working interest in the Longanesi field is now unencumbered except for normal government royalties (10%). The Blugas Settlement Agreement was accounted for as an acquisition of the Blugas ORRI claim with a corresponding increase to the expected future cash flows from our reserves. Our year-end December 31, 2023 reserve quantities included the 20% of 350 million standard cubic meters (approximately 2,472 106 ft 3) allocable to the Blugas ORRI in our proved gas reserves. However, the required payments to Blugas associated with the sale of such quantities were reflected as cash outflows (costs) in our year-end December 31, 2023 reserve report as if such amounts were paid to Blugas. Following settlement, our year-end December 31, 2024 reserve quantities continue to include the 20% of 350 million standard cubic meters (approximately 2,472 106 ft 3), however, the previously required payments to Blugas associated with the sale of such quantities are no longer reflected as cash outflows (costs) as if such amounts were paid to Blugas. As the cash outflows (costs) are no longer reflected as if paid to Blugas, such amounts are reflected in our December 31, 2024 reserve report as allocable to our unencumbered 33.5% working interest.
Previous report
Contingent Consideration Liability
Reworded paragraphs (25)
Previous wording
Our recent drilling and exploration activities involve the drilling and testing of three Longanesi development wells (during 2022 and 2023) as well as the re-completion of two original discovery wells. We had no drilling activity during the three and nine months ended September 30, 2025 or 2024. We had no other exploratory or development drilling during three and nine months ended September 30, 2025 or 2024. Our Longanesi, Trava and Gradizza wells were classified by DeGolyer as proved undeveloped reserves as such wells had not yet started production as of December 31, 2024 and require future investments to install production facilities prior to being fully completed and producible. However, as noted in the “Recent Developments” section below, we achieved first production from the Longanesi field in 2025.
Current wording
Our recent drilling and exploration activities involve the drilling and testing of three Longanesi development wells (during 2022 and 2023) as well as the re-completion of two original discovery wells. We had no drilling activity during the three months ended March 31, 2026 or 2025. We had no other exploratory or development drilling during three months ended March 31, 2026 or 2025. Our Longanesi, Trava and Gradizza wells were classified by DeGolyer and MacNaughton as proved undeveloped reserves as such wells had not yet started production as of December 31, 2025 and require future investments to install production facilities prior to being fully completed and producible. However, as noted in the “Recent Developments” section below, we achieved first production from the Longanesi field in 2025.
Previous wording
The Business Combination was accounted for as a common control transaction with respect to AleAnna Energy which is akin to a reverse recapitalization. This conclusion was based on the fact that Nautilus Resources LLC (“Nautilus”) had a controlling financial interest in AleAnna Energy prior to the Business Combination and has a controlling financial interest in AleAnna, which includes AleAnna Energy as a wholly owned subsidiary. The net assets of SPAC are stated at their historical carrying amounts with no goodwill or intangible assets recognized in accordance with the accounting principles generally accepted in the United States of America (“GAAP”). The Business Combination with respect to AleAnna Energy was not treated as a change in control primarily due to Nautilus receiving the controlling voting stake in AleAnna and the ability of Nautilus to nominate the full board of directors and management of AleAnna.
Current wording
The Business Combination was accounted for as a common control transaction with respect to AleAnna Energy which is akin to a reverse recapitalization. This conclusion was based on the fact that Nautilus Resources LLC (“Nautilus”) had a controlling financial interest in AleAnna Energy prior to the Business Combination and has a controlling financial interest in AleAnna, which includes AleAnna Energy as a wholly owned subsidiary. The net assets of SPAC are stated at their historical carrying amounts with no goodwill or intangible assets recognized in accordance with the accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”). The Business Combination with respect to AleAnna Energy was not treated as a change in control primarily due to Nautilus receiving the controlling voting stake in AleAnna and the ability of Nautilus to nominate the full board of directors and management of AleAnna.
Previous wording
We incurred $9.5 million in transaction costs related to the Business Combination. Approximately $0.6 million of these costs were recorded as a reduction to additional paid-in capital, up to the amount of cash proceeds received in the transaction. Of the remaining $8.9 million, approximately $0.5 million represented prepaid directors and officers insurance premiums that were recorded to other assets in the consolidated balance sheet, and $8.4 million represented legal, accounting, consulting and advisory fees which were recorded as Business Combination transaction expenses in the consolidated statement of operations and comprehensive loss.
Current wording
We incurred $9.5 million in transaction costs related to the Business Combination. Approximately $0.6 million of these costs were recorded as a reduction to additional paid-in capital, up to the amount of cash proceeds received in the transaction. Of the remaining $8.9 million, approximately $0.5 million represented prepaid directors and officers insurance premiums that were recorded to other assets in the consolidated balance sheet, and $8.4 million represented legal, accounting, consulting and advisory fees which were recorded as Business Combination transaction expenses in the consolidated statement of operations and comprehensive income (loss).
Previous wording
On August 6, 2025, AleAnna reached an agreement with the Emilia Romagna Region (the “Intesa”) in support of its pending application for a production concession related to the Gradizza field. This represents one of two major regulatory approvals required prior to first production. The second required approval—authorization from the Federal Ministry—remains pending.
Current wording
During the third quarter of 2025, AleAnna reached an agreement with the Emilia Romagna Region (the “Intesa”) in support of its pending application for a production concession related to the Gradizza field. The second application was approved in January 2026. These approvals represent a significant milestone required prior to first production.
Previous wording
AleAnna holds a 100% working interest in the Gradizza field and will serve as operator. If and when a production concession is granted, Gradizza is expected to become the Company’s first operated producing asset. According to the Company’s reserve report as of December 31, 2024, Gradizza contains 380 MMcf of proved reserves.
Current wording
AleAnna holds a 100% working interest in the Gradizza field and will serve as operator. If and when a production concession is granted, Gradizza is expected to become the Company’s first operated producing asset. According to the Company’s reserve report as of December 31, 2025, Gradizza contains 703 MMcf of proved reserves.
Previous wording
As previously discussed, we and Padana achieved first production of the five wells in the Longanesi field in March 2025 through use of a temporary processing facility. The permanent processing facility is expected to be constructed over the remainder of 2025 and 2026.
Current wording
As previously discussed, we and Padana achieved first production of the five wells in the Longanesi field in March 2025 through use of a temporary processing facility. The permanent processing facility is expected to be constructed over the remainder of 2026 and early 2027.
Previous wording
During the three and nine months ended September 30, 2025, we generated approximately $0.6 million and $2.0 million, respectively, of revenue from electricity sales at two renewable natural gas assets acquired in July 2024 (the “Casalino” and “Campopiano” plants). The plant assets are fully permitted for production of electricity through conversion of crop and animal waste bio feedstocks. The plant assets are currently biomethane to electricity conversion assets. It is our intention to begin upgrading the sites to refine biomethane into renewable natural gas through upgrading units. Following the upgrade process to transition the assets to biomethane to renewable natural gas conversion, we expect to sell renewable natural gas to customer(s) by trucking or piping the renewable natural gas to the interstate pipeline system (SNAM). Until the plant assets are upgraded, we will actively source bio feedstocks for the assets in order to produce biomethane which will be processed through reciprocating generators in order to generate electricity which is then sold onto the grid through a metered interconnection. Casalino and Campopiano derive revenues from the sale of such electricity to the local state-owned electrical utility (Gestore dei Servizi Energetici SpA or “GSE”). Energy generation revenue is recognized as the electricity generated by the Casalino and Campopiano assets is delivered to GSE. Revenues are based on actual output and “on-the-spot” predetermined prices for small renewable energy producers.
Current wording
During the three months ended March 31, 2026, revenue from our Conventional segment was comprised of sales of our share of natural gas from the Longanesi field. During the three months ended March 31, 2026, revenue from our Renewable segment was comprised ofelectricity sales at two renewable natural gas assets acquired in July 2024 (the “Casalino” and “Campopiano” plants). The plant assets are fully permitted for production of electricity through conversion of crop and animal waste bio feedstocks. The plant assets are currently biomethane to electricity conversion assets. It is our intention to begin upgrading the sites to refine biomethane into renewable natural gas through upgrading units. Following the upgrade process to transition the assets to biomethane to renewable natural gas conversion, we expect to sell renewable natural gas to customer(s) by trucking or piping the renewable natural gas to the interstate pipeline system (SNAM). Until the plant assets are upgraded, we will actively source bio feedstocks for the assets in order to produce biomethane which will be processed through reciprocating generators in order to generate electricity which is then sold onto the grid through a metered interconnection. Casalino and Campopiano derive revenues from the sale of such electricity to the local state-owned electrical utility (Gestore dei Servizi Energetici SpA or “GSE”). Energy generation revenue is recognized as the electricity generated by the Casalino and Campopiano assets is delivered to GSE. Revenues are based on actual output and “on-the-spot” predetermined prices for small renewable energy producers.
Previous wording
Cost of revenues primarily consists of biofeedstock purchased by the RNG Subsidiaries. This feedstock fuels the anaerobic digesters (“ADs”), which produce biomethane that is then converted to electricity and sold onto the grid.
Current wording
Cost of revenues consists of gas tariffs and royalties, as well as rent expense related to the conventional gas business, and biofeedstock purchased by the RNG Subsidiaries. This feedstock fuels the anaerobic digesters (“ADs”), which produce natural gas that is then converted to electricity and sold onto the grid.
Previous wording
Lease operating expenses reflect ongoing costs related to the Longanesi field which commenced production in the second quarter of 2025. Such costs are passed down to us by the Longanesi field operator, Pradana, and include accrued royalties payable to the Italian government, pipeline fees, repairs and maintenance, and other field-related costs.
Current wording
Lease operating expenses reflect ongoing costs related to the Longanesi field which commenced production in the second quarter of 2025. Such costs are passed down to us by the Longanesi field operator, Padana, and include accrued royalties payable to the Italian government, pipeline fees, repairs and maintenance, and other field-related costs.
Previous wording
AleAnna’s income tax consequences have been reflected in its consolidated financial statements in accordance with ASC 740,Income Taxes. Despite the start of Longanesi production, given AleAnna’s history of losses, and because future production remains uncertain, a full valuation allowance was applied against deferred tax assets as of September 30, 2025 and 2024.
Current wording
AleAnna’s income tax consequences have been reflected in its consolidated financial statements in accordance with ASC 740,Income Taxes. Despite the start of Longanesi production, given AleAnna’s history of losses, and because future production remains uncertain, a full valuation allowance was applied against deferred tax assets as of March 31, 2026 and as of December 31, 2025.
Previous wording
We are also subject to a Valued-Added Tax (“VAT”), a broadly-based consumption tax assessed on the value added to goods and services. VAT generally applies to most goods and services bought and sold within the EU. In certain cases, including cross-border sales to business customers and sales of biogas within Italy, we are not required to collect VAT on revenues. To date, we have incurred higher VAT on purchases (input VAT) than we have collected on sales (output VAT), resulting in a net VAT refund receivable. As of September 30, 2025 and December 31, 2024, we had VAT receivables of $8.5 million and $6.8 million, respectively. Under Italian tax law, VAT receivables may be used to offset other tax liabilities, including payroll taxes, income taxes, and other taxes payable to the Italian government.
Current wording
We are also subject to a Valued-Added Tax (“VAT”), a broadly-based consumption tax assessed on the value added to goods and services. VAT generally applies to most goods and services bought and sold within the EU. In certain cases, including cross-border sales to business customers and sales of biogas within Italy, we are not required to collect VAT on revenues. To date, we have incurred higher VAT on purchases (input VAT) than we have collected on sales (output VAT), resulting in a net VAT refund receivable. As of March 31, 2026 and December 31, 2025, we had VAT receivables of $10.4 million and $9.6 million, respectively. Under Italian tax law, VAT receivables may be used to offset other tax liabilities, including payroll taxes, income taxes, and other taxes payable to the Italian government.
Previous wording
Our net income attributable to common stockholders was $3.3 million and $1.7 million for the three and nine months ended September 30, 2025, respectively, as compared to net loss attributable to common stockholder of $1.1 million and $158.4 million for the same periods in 2024. As of September 30, 2025 and December 31, 2024, we had an accumulated deficit of $189.4 million and $191.0 million, respectively. The majority of these accumulated losses stem from costs associated with the Longanesi field drilling and development, including asset impairments from previous years, as well as seismic imaging, exploratory costs for other conventional natural gas prospects, and general and administrative expenses. The accumulated deficits also include historical deemed dividends to the redemption value of AleAnna Energy’s previous Class 1 Preferred Units (exchanged for Class A and Class C common stock in connection with the Business Combination) based on the redemption features of those units and the related accounting requirements.See“Note 10 — Equity” to the audited condensed consolidated financial statements for further details. We expect to continue to incur substantial expenses related to our operations, exploration, and development activities, including pre-commercialization efforts as we continue our development of, and seek regulatory approval for, our discoveries and exploration prospects. Since inception, we have incurred net losses annually. We achieved quarterly net income for the first time during the second quarter of 2025. We achieved net income during the three and nine months ended September 30, 2025 and 2024. We expect to continue sustained profitability.
Current wording
Our net income attributable to common stockholders was $2.1 million for the three months ended March 31, 2026, as compared to net loss attributable to common stockholder of $2.0 million for the same period in 2025. As of March 31, 2026 and December 31, 2025, we had an accumulated deficit of $187.2 million and $189.2 million, respectively. The majority of these accumulated losses stem from costs associated with the Longanesi field drilling and development, including asset impairments from previous years, as well as seismic imaging, exploratory costs for other conventional natural gas prospects, and general and administrative expenses. The accumulated deficits also include historical deemed dividends to the redemption value of AleAnna Energy’s previous Class 1 Preferred Units (exchanged for Class A and Class C common stock in connection with the Business Combination) based on the redemption features of those units and the related accounting requirements*.* We expect to continue to incur substantial expenses related to our operations, exploration, and development activities, including pre-commercialization efforts as we continue our development of, and seek regulatory approval for, our discoveries and exploration pros pects. We achieved quarterly net income for the first time during the second quarter of 2025. We expect to continue sustained profitability.
Previous wording
Comparison of the three and nine months ended September 30, 2025 and 2024
Current wording
Comparison of the three months ended March 31, 2026 and 2025 is as follows:
Previous wording
During the three and nine months ended September 30, 2025, our revenue was earned through sales of our share of natural gas production from the Longanesi field and from electricity generation and sales at the Casalino and Campopiano renewable natural gas plants. Cost of revenues from sales of electricity consists of feedstock costs, direct labor and overhead necessary to produce RNG and generate electricity. Cost of revenues from sales of natural gas consists of gas tariffs and royalties, as well as rent expense.
Current wording
During the three months ended March 31, 2026, our revenue was earned primarily through sales of our share of natural gas production from the Longanesi field and, to a lesser extent, from electricity generation and sales at the Casalino and Campopiano renewable natural gas plants. Cost of revenues from sales of electricity consists of feedstock costs, direct labor and overhead necessary to produce Renewable Natural Gas (“RNG”) and generate electricity. Cost of revenues from sales of natural gas consists of gas tariffs and royalties, as well as rent expense.
Previous wording
General and administrative expenses increased by $0.6 million or 38% and $2.7 million or 61% for the three and nine months ended September 30, 2025, compared to same periods in 2024. The increases were primarily due to increases in legal, audit and consulting fees to support public company operations.
Current wording
General and administrative expenses decreased by $1.1 million or 33% for the three months ended March 31, 2026, compared to same period in 2025. The decrease was primarily due to decreases in legal, audit and consulting fees.
Previous wording
Interest and other income (expenses) primarily includes interest earned on cash and cash equivalents. Interest and other income decreasedby $0.2 million or 63% and $0.8 million or 59% during the three and nine months ended September 30, 2025 compared to the same periods in 2024, primarily due to higher interest (higher rates) earned on larger average cash balances during the 2024 periods compared to the 2025 periods presented.
Current wording
Interest and other income primarily includes interest earned on cash and cash equivalents. Interest and other income decreased by $0.1 million or 41% to $0.1 during the three months ended March 31, 2026 compared to $0.2 the same period in 2025, primarily due to slightly higher interest earned on larger average cash balances during 2025 period compared to the 2026 period presented.
Previous wording
The currency translation adjust ment decreased by $1.7 million and increased by $3.2 million for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024. The decrease and increase were primarily driven by fluctuations of the exchange rates between the Euro and the U.S. Dollar as well as the level of our activities. This change was primarily driven by fluctuations in the Euro to U.S. Dollar exchange rates and the level of our Euro-denominated activities. The spot rate strengthened from December 31, 2024 to September 30, 2025, and the average exchange rates were higher during the 2025 periods, resulting in larger positive currency translation adjustments relative to the 2024 periods.
Current wording
The currency translation adjust mentdec reased by $2.2 million for the three months ended March 31, 2026 compared to the same period in 2025. The decrease was primarily driven by fluctuations of the exchange rates between the Euro and the U.S. Dollar as well as the level of our Euro-denominated activities. The spot rate weakened from December 31, 2025 to March 31, 2026, and the average exchange rates were higher during the 2026 period, resulting in negative currency translation adjustments relative to the 2025 period.
Previous wording
During the second quarter of 2025, in connection with the commencement of production at the Longanesi field, the Company’s evaluation of operating results between conventional and renewable operations became more relevant to the chief operating decision maker, resulting in further disaggregation of the Company’s single reportable segment. As a result, as of September 30, 2025, we determined that we have two operating segments, each of which also qualifies as a reportable segment, based on the manner in which the chief operating decision maker (“CODM”)—the Company’s Executive Director and Chief Executive Officer, collectively—reviews financial information to assess performance and allocate resources.
Current wording
During the second quarter of 2025, in connection with the commencement of production at the Longanesi field, the Company’s evaluation of operating results between conventional and renewable operations became more relevant to the chief operating decision maker, resulting in further disaggregation of the Company’s single reportable segment. As a result, as of March 31, 2026, we determined that we have two operating segments, each of which also qualifies as a reportable segment, based on the manner in which the chief operating decision maker (“CODM”) — the Company’s Chief Executive Officer—reviews financial information to assess performance and allocate resources.
Previous wording
The three and nine months ended September 30, 2025 reflect the revenue and expense categories noted above in the consolidated Results of Operations. For the three and nine months ended September 30, 2024, the Company had no revenues, immaterial RNG assets, and minimal operating expenses outside of corporate general and administrative expenses. The vast majority of natural gas development activities were capitalized prior to the second quarter of 2025.
Current wording
The three months ended March 31, 2026 reflect the revenue and expense categories noted above in the consolidated Results of Operations. For the three months ended March 31, 2025, the Company had minimal revenues, RNG assets, and operating expenses outside of corporate general and administrative expenses. The vast majority of natural gas development activities were capitalized prior to the second quarter of 2025.
Previous wording
We have begun generating revenue from our operations. We had an accumulated deficit of $189.4 million as of September 30, 2025. We had $31.2 million in unrestricted cash and cash equivalents on September 30, 2025. The Company’s continuing operations, as intended, are dependent upon its ability to generate cash flows or obtain additional financing. Between January 2024 and May 2024, prior to the Business Combination, we received an aggregate of $62.1 million in capital contributions from AleAnna Energy members resulting in the issuance of 62,100 Class 1 Preferred Units, to fund operating costs, capital expenditures, Business Combination related transaction expenses, and to provide working capital to meet our liabilities and commitments as they become due. We also received approximately $1.1 million from exercises of Public Warrants between January 2025 and May 2025. In addition, we are exploring Resource Backed Loan (“RBL”) financing, renewable natural gas project loan products and other financing arrangements with several financial institutions; however, there is no guarantee that such financing will be available to us. As a normal part of our business, depending on market conditions, we may from time to time consider opportunities to issue equity or debt securities to raise additional capital. Changes in our operating plans, lower than anticipated revenues, increased expenses, acquisitions or other events may cause us to seek additional debt or equity financing in future periods. There can be no guarantee that financing will be available on acceptable terms or at all.
Current wording
The Company’s continuing operations, as intended, are dependent upon its ability to generate cash flows or obtain additional financing. In addition, we are exploring Resource Backed Loan (“RBL”) financing, renewable natural gas project loan products and other financing arrangements with several financial institutions; however, there is no guarantee that such financing will be available to us. As a normal part of our business, depending on market conditions, we may from time to time consider opportunities to issue equity or debt securities to raise additional capital. Changes in our operating plans, lower than anticipated revenues, increased expenses, acquisitions or other events may cause us to seek additional debt or equity financing in future periods. The current high-interest rate environment adds additional risk and expense to the issuance of debt securities or loan arrangements to fund capital investment. There can be no guarantee that financing will be available on acceptable terms or at all.
Previous wording
The following table includes our cash flow data for the nine months ended September 30, 2025 and 2024:
Current wording
The following table includes our cash flow data for the three months ended March 31, 2026 and 2025:
Previous wording
Cash generated in operating activities increased by $13.3 million for the nine months ended September 30, 2025, compared to the same period in 2024. This increase primarily reflects cash revenues from the Longanesi field from the second half of 2025, collections on electricity sales receivable from RNG plants, and the timing of payments of accounts payable during the nine months ended September 30, 2025 compared to the same period in 2024.
Current wording
Cash generated in operating activities increased by $4.8 million for the three months ended March 31, 2026, compared to the same period in 2025. This increase primarily reflects cash revenues from the Longanesi field, collections on electricity sales receivable from RNG plants, and the timing of payments of accounts payable during the three months ended March 31, 2026 compared to thesame period in 2025.
Previous wording
Cash used in investing activities increased by $14.3 million for the nine months ended September 30, 2025, compared to the same period in 2024. In both periods, investing cash flows primarily reflected continued development of the Longanesi wells. The increase during thenine months ended September 30, 2025 was driven by a lower level of completion and tie-in activity relative to the same period in 2024. During the second quarter of 2025, the five Longanesi wells were brought online, resulting in only a partial year of capitalized costs. Capital expenditures during the 2025 period primarily reflected final tie-in work and capital calls from our operating partner, Padana, for the permanent Longanesi processing facility. In contrast, the 2024 period included a full nine months of development and tie-in costs for the Longanesi field, in addition to the acquisition of the Campagnatico RNG asset.
Current wording
Cash used in investing activities increased by $1.7 million for the three months ended March 31, 2026, compared to the same period in 2025. In both periods, investing cash flows primarily reflected continued development of the Longanesi wells.
Previous wording
Cash provided by financing activities during the nine months ended September 30, 2025 reflects proceeds from cash exercises of Public Warrants.
Current wording
Cash used in financing activities during the three months ended March 31, 2026 reflects tax payments made related to net share settlements of PSUs. Cash provided by financing activities during the three months ended March 31, 2025 reflects proceeds from cash exercises of our Public Warrants.
Previous wording
We recognized a liability for the contingent consideration in accounting for the asset acquisition in accordance with ASC 450,Contingencies(“contingent consideration liability”). As of September 30, 2025 and December 31, 2024, the total contingent consideration liability was recorded at $28.1 million and $25.0 million, respectively, with $10.8 million and nil being classified as a short-term and $17.4 million and the entire balance being classified as a long-term liability for the same respective periods.
Current wording
We recognized a liability for the contingent consideration in accounting for the asset acquisition in accordance with ASC 450,Contingencies(“contingent consideration liability”). As of March 31, 2026 and December 31, 2025, the total contingent consideration liability was recorded at $27.6 million and $28.2 million, respectively, with $11.3 million and $11.6 million being classified as a short-term and $16.3 million and $16.7 million being classified as a long-term liability for the same respective periods.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
In 2021, we launched a renewable natural gas development business focused on bringing to market carbon negative renewable natural gas derived from animal and agricultural waste. As previously discussed, the first three renewable natural gas assets were purchased between March 2024 and July 2024, with additional renewable natural gas projects expected to be purchased in the future.