Zeo Energy Corp.
For the period ended Jun 30, 2026. Filed Aug 14, 2026.
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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, 2026 · Filed Aug 14, 2026
ZEO$0.21-2.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-15.
0001213900-26-057724
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-14.
0001213900-26-090073
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 100 previous paragraphs and 113 current paragraphs.
55 unchanged; 32 reworded; 23 added; 13 removed; 0 previous and 3 current paragraphs rearranged.
Tables are not compared: 5 previous and 6 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (23)
Current report
Through our Heliogen segment, acquired in August 2025, we are also developing concentrated solar power and long-duration energy generation and storage technology solutions for commercial and industrial applications.
Current report
White Lion Convertible Note
Current report
On June 9, 2026, we entered into a Note Purchase Agreement (the “Note Purchase Agreement”) with White Lion Capital LLC (“White Lion”), pursuant to which we agreed to issue, and White Lion agreed to purchase, at one or more closings, unsecured convertible promissory notes in an aggregate funded amount of up to $7,500,000 (each a “Convertible Note”). At the first closing on June 9, 2026, we issued to White Lion a Convertible Note in the principal amount of $1,670,000, reflecting an original issue discount of $170,000, for gross proceeds of $1,500,000. We incurred $57,132 of debt issuance costs, resulting in net proceeds of $1,442,868. Additional closings for up to $6,000,000 of gross proceeds may occur at any time prior to June 9, 2027 upon the mutual written agreement of us and White Lion, subject to customary closing conditions.
Current report
The Convertible Note matures on June 9, 2028 and accrues interest at 5% per annum. The Convertible Note is convertible, in whole or in part, into shares of Class A common stock at the option of White Lion at a conversion price per share equal to the greater of (i) $0.50 (the “Floor Price”) and (ii) the lesser of (A) the Nasdaq Minimum Price (as defined under Nasdaq rules, $0.80 as of the issuance date) and (B) 95% of the lowest daily volume-weighted average price of the Class A common stock during the five trading days ending on the latest complete trading day prior to conversion. The conversion price is subject to customary adjustments for stock splits and similar events and to adjustment upon certain dilutive issuances below the then-effective conversion price. The Floor Price will no longer apply if (i) we complete a subsequent equity raise with a party other than White Lion at a price below $0.50, (ii) the average of the daily volume-weighted average prices of the Class A common stock for thirty consecutive trading days is less than $0.50, or (iii) an event of default occurs.
Current report
Conversions are subject to a beneficial ownership limitation of 4.99% (or, at White Lion’s election, 9.99%) and, pursuant to applicable Nasdaq rules, shares issuable upon conversion may not exceed 19.99% of our outstanding Class A common stock immediately prior to the first closing (the “Conversion Cap”) unless stockholder approval is obtained. We were obligated to seek stockholder approval for issuances above the Conversion Cap within 60 days of June 9, 2026. At our annual meeting of stockholders held on August 7, 2026, stockholders approved the issuance of shares of Class A common stock in excess of the Conversion Cap in accordance with Nasdaq Listing Rule 5635(d). The Convertible Note is subject to customary events of default; upon an event of default, subject to applicable cure periods, the principal amount would automatically increase to 120% of the then-outstanding principal, plus accrued and unpaid interest, and would become immediately due and payable. We may prepay the Convertible Note at any time, in whole or in part, without premium or penalty, upon at least five business days’ written notice, during which period White Lion may exercise its conversion rights. We are also subject to a “most favored nation” provision in favor of White Lion and restrictions on entering into variable rate transactions and equity lines of credit with parties other than White Lion without White Lion’s consent. In addition, White Lion has the right to require that up to 20% of the proceeds from sales under the White Lion ELOC, warrant exercises, or other securities issuances be applied to repay the Convertible Note.
Current report
Concurrently with the Note Purchase Agreement, we entered into a Registration Rights Agreement with White Lion, pursuant to which we agreed to file, within 30 days following the first closing, a registration statement covering the resale by White Lion of the shares issuable upon conversion, and which contains customary damages provisions for failure to file or to have the registration statement declared effective within the specified periods. We did not file the registration statement within the 30-day period. White Lion subsequently waived this covenant with the expectation that the registration statement will be filed no later than August 31, 2026.
Current report
Cost of revenues increased by $1.2 million from $7.3 million for the three months ended June 30, 2025 to $8.5 million for the three months ended June 30, 2026, primarily driven by an increase in labor costs in the markets in which we operate and an increase in the cost of materials to conform to domestic content requirements of our customers during the current period. As a percentage of net revenues, cost of revenues increased from 40.2% for the three months ended June 30, 2025 to 52.9% for the three months ended June 30, 2026, reflecting a compression in gross margin year-over-year primarily driven by higher material costs, offset by some improvements to labor and other costs.
Current report
Sales and marketing expenses decreased by $1.2 million from $5.6 million for the three months ended June 30, 2025 to $4.4 million for the three months ended June 30, 2026. The decrease was primarily driven by lower sales commissions, reflecting both the decrease in installation revenues and changes to the Company’s commission structure, as well as lower payroll and lead generation costs following the elimination of the inside sales team early in the second quarter of 2026.
Current report
Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025
Current report
Net Revenues
Current report
Cost of Revenues
Current report
Depreciation and Amortization
Current report
Sales and Marketing
Current report
Sales and marketing expenses decreased by $0.4 million from $7.8 million for the six months ended June 30, 2025 to $7.4 million for the six months ended June 30, 2026. The decrease was primarily driven by lower sales commissions, reflecting changes to the Company’s commission structure, as well as lower payroll and lead generation costs following the elimination of the inside sales team early in the second quarter of 2026, notwithstanding the increase in installation revenues during the period.
Current report
General and Administrative Expenses
Current report
General and administrative expenses decreased by $3.1 million from $15.3 million for the six months ended June 30, 2025 to $12.2 million for the six months ended June 30, 2026. The decrease was primarily driven by decreased bad debt expense, stock-based compensation expense and transaction-related expenses compared to the prior period, offset by increased professional fees during the current period.
Current report
Other Income (Expense)
Current report
Other income, net decreased by $0.4 million from $0.7 million for the six months ended June 30, 2025 to $0.3 million for the six months ended June 30, 2026. The decrease was primarily a result of a significant gain on change in fair value of warrant liabilities during the six months ended June 30, 2025, compared to a loss on change in fair value of warrant liabilities during the six months ended June 30, 2026, partially offset by a gain on change in fair value of derivative liability recognized during the current period.
Current report
In June 2026, we issued a convertible promissory note to White Lion in the principal amount of $1.7 million for net proceeds of approximately $1.4 million, and up to $6 million of additional gross proceeds may be funded at one or more additional closings, although any additional closing requires the mutual written agreement of us and White Lion. SeeNote 8—Debt to the condensed consolidated financial statements.
Current report
As of June 30, 2026, our outstanding indebtedness consisted of the Convertible Note in the principal amount of $1.7 million (with a net carrying amount of $0.5 million after unamortized debt discount), vehicle loans of less than $0.1 million, and finance lease liabilities of $0.3 million. SeeNote 8—Debt to the condensed consolidated financial statements for additional information regarding the Convertible Note.
Current report
Embedded Derivative Liabilities
Current report
We evaluate the embedded features of our financial instruments, including convertible notes payable, in accordance with ASC 480, “Distinguishing Liabilities from Equity,” and ASC 815, “Derivatives and Hedging.” Certain conversion options and redemption features are required to be bifurcated from their host instrument and accounted for separately as derivative financial instruments when certain criteria are met. We apply significant judgment to identify and evaluate complex terms and conditions for our financial instruments to determine whether such instruments are derivatives or contain features that qualify as embedded derivatives. Bifurcated embedded derivatives are recognized at fair value, with changes in fair value recognized in the condensed consolidated statements of operations each period.
Current report
The fair value of the bifurcated embedded derivative liability related to the Convertible Note is estimated using a Monte Carlo simulation model. The model requires significant judgment, including assumptions regarding expected volatility of our Class A common stock, the risk-free interest rate, the expected timing of the commencement and pace of conversion, and the simulated path of the conversion price, which is subject to the Floor Price and a pricing ceiling and may vary with the market price of our Class A common stock. Changes in these assumptions, particularly expected volatility and the assumed timing of conversion, could materially affect the estimated fair value of the derivative liability and the related change in fair value recognized in our condensed consolidated statements of operations. As of June 30, 2026, the estimated fair value of the embedded derivative liability was $699,100, and the change in fair value recognized for the three and six months ended June 30, 2026 was a gain of $232,500. SeeNote 8—Debt andNote 9—Fair Value Measurements for additional information.
Removed paragraphs (13)
Previous report
White Lion Financing Transaction
Previous report
On January 27, 2026, we entered into the White Lion Purchase Agreement with White Lion. We also entered into a Registration Rights Agreement (“RRA”) with White Lion on January 27, 2026. Pursuant to the White Lion Purchase Agreement, the Company has the right, but not the obligation, to require White Lion to purchase, from time to time, up to $30.0 million in aggregate gross purchase price of newly issued shares of our Class A Common Stock, subject to certain limitations and conditions set forth in the White Lion Purchase Agreement. Subject to the satisfaction of certain customary conditions, the Company’s right to sell shares to White Lion commenced on the date of the execution of White Lion Purchase Agreement and extends until White Lion Commitment Period.
Previous report
During the White Lion Commitment Period, subject to the terms and conditions of the White Lion Purchase Agreement, the Company may notify White Lion when the Company exercises its right to sell shares of its Class A Common Stock. The Company may deliver a Rapid Purchase Notice (as such term is defined in the White Lion Purchase Agreement), where the Company can require White Lion to purchase up to a number of shares of Class A Common Stock equal to the 20% of Average Daily Trading Volume (as such term is defined in the White Lion Purchase Agreement). The Company may also deliver an Accelerated Purchase Notice (as such term is defined in the White Lion Purchase Agreement), where the Company may require White Lion to purchase up to a number of shares of Class A Common Stock equal to 20% of the Average Daily Trading Volume. White Lion may waive such limits under any notice at its discretion and purchase additional shares.
Previous report
The price to be paid by White Lion for any shares that the Company requires White Lion to purchase will depend on the type of purchase notice that the Company delivers. For shares being issued pursuant to Accelerated Purchase Notice, the purchase price per share will be equal to the lowest traded price of Class A Common Stock during one (1) hour period following the White Lion’s written consent of the acceptance of the notice. For shares being issued pursuant to a Rapid Purchase Notice, the purchase price per share will be equal to the average of the three (3) lowest traded prices on the date that the notice is delivered.
Previous report
No purchase notice shall result in White Lion beneficially owning (as calculated pursuant to Section 13(d) of the Exchange Act and Rule 13d-3 thereunder) more than 4.99% of the number of shares of the Class A Common Stock outstanding immediately prior to the issuance of shares of Class A Common Stock issuable pursuant to a purchase notice.
Previous report
The Company may deliver purchase notices under the White Lion Purchase Agreement, subject to market conditions, and in light of our capital needs, from time to time and under the limitations contained in the White Lion Purchase Agreement. Any proceeds that the Company receives under the White Lion Purchase Agreement are expected to be used for working capital and general corporate purposes.
Previous report
The White Lion Purchase Agreement may be terminated by the Company at any time and for any reason, in its sole discretion, subject to the Company having delivered the applicable Commitment Shares (as defined below). The White Lion Purchase Agreement will also terminate automatically upon the earlier of the expiration of the White Lion Commitment Period or the occurrence of certain bankruptcy or insolvency-related events involving the Company.
Previous report
In consideration for the commitments of White Lion, as described above, the Company is contractually committed to issue to White Lion the Commitment Shares. The Commitment Shares are deemed fully earned and non-refundable as of the execution date of the White Lion Purchase Agreement; however, if the White Lion Purchase Agreement is terminated by the Company as a result of a material breach by White Lion, the Company may pursue all remedies available at law or in equity, including reimbursement or recovery of such Commitment Shares, to the extent permitted by applicable law.
Previous report
Concurrently with the White Lion Purchase Agreement, the Company entered into the RRA with White Lion. The Purchase Agreement and the RRA contain customary representations, warranties, conditions and indemnification obligations of the parties. The representations, warranties and covenants contained in such agreements were made only for purposes of such agreements and as of specific dates, were solely for the benefit of the parties to such agreements and may be subject to limitations agreed upon by the contracting parties.
Previous report
White Horse Energy Transaction
Previous report
On January 30, 2026, Sunergy, a subsidiary of the Company, increased the subordinated loan in the form of a note receivable with White Horse Energy, LLC from $3.0 million to $6.15 million under the same terms as the original note.
Previous report
Sales and marketing expenses decreased by $0.1 million from $3.1 million for the three months ended March 31, 2025 to $3.0 million for the three months ended March 31, 2026. The decrease was primarily driven by lower stock-based compensation expense, offset by higher sales commissions, consistent with the increase in installation revenues during the period.
Previous report
As of March 31, 2026, the Company’s outstanding indebtedness consisted of approximately $73,471 of vehicle loans. The Company has historically funded its operations and growth through a combination of cash on hand, proceeds from financing activities, and in 2025, net cash acquired in connection with the Heliogen acquisition.
Reworded paragraphs (32)
Previous wording
References to the “Company,” “our,” “us” or “we” refer to Zeo Energy Corp. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and the notes thereto contained elsewhere in this Quarterly Report on Form 10-Q (this “Quarterly Report”). Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Current wording
Unless the context requires otherwise, references herein to the “Company,” “our,” “us” or “we” refer to Zeo Energy Corp. and its consolidated subsidiaries. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and the notes thereto contained elsewhere in this Quarterly Report on Form 10-Q (this “Quarterly Report”). Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Previous wording
Our company and personnel are passionate about delivering cost savings and increased independence and reliability to energy consumers. Our mission is to expedite the country’s transition to renewable energy by offering our customers an affordable and sustainable means of achieving energy independence. We are a vertically integrated company offering energy solutions and services that include sale, design, procurement, installation, and maintenance of residential solar energy systems. Many of our solar energy system customers also purchase other energy efficient-related equipment or services or roofing services from us. The majority of our customers are located in Florida, Texas, Ohio, Illinois, and Virginia. We have an expanding base of customers in California, Colorado, Minnesota, Utah, and Pennsylvania. Sunergy was created on October 1, 2021 through the Contribution of Sun First Energy, LLC, a rapidly growing solar sales management company, and Sunergy Solar, LLC, a large solar installation company based in Florida, to Sunergy Renewables, LLC.
Current wording
Our company and personnel are passionate about delivering cost savings and increased independence and reliability to energy consumers. Our mission is to expedite the country’s transition to renewable energy by offering our customers an affordable and sustainable means of achieving energy independence. We are a vertically integrated company offering energy solutions and services that include sale, design, procurement, installation, and maintenance of residential solar energy systems. Many of our solar energy system customers also purchase other energy efficient-related equipment or services or roofing services from us. The majority of our customers are located in Florida, Texas, Ohio, Illinois, and Virginia. We have an expanding base of customers in California, Colorado, Minnesota, Utah, and Pennsylvania. Sunergy was created on October 1, 2021 through the contribution of Sun First Energy, LLC, a solar sales management company, and Sunergy Solar, LLC, a solar installation company based in Florida, to Sunergy Renewables, LLC.
Previous wording
On April 23, 2026, the Company received a letter from the Listing Qualifications Staff of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that, based upon the closing bid price of the Company’s Class A common stock for the last 30 consecutive business days, the Company no longer meets Nasdaq Listing Rule 5550(a)(2), which requires listed companies to maintain a minimum bid price of at least $1 per share. Nasdaq Listing Rule 5810(c)(3)(A) provides a compliance period of 180 calendar days, or until October 20, 2026, in which to regain compliance with the minimum bid price requirement. If the Company evidences a closing bid price of at least $1 per share for a minimum of 10 consecutive business days during the 180-day compliance period, the Company will automatically regain compliance. In the event the Company does not regain compliance with the $1 bid price requirement by October 14, 2026, the Company may be eligible for consideration of a second 180-day compliance period if it meets the continued listing requirement for market value of publicly held shares and all other initial listing standards for Nasdaq’s Capital Market, other than the minimum bid price requirement. In addition, the Company would also be required to notify Nasdaq of its intent to cure the minimum bid price deficiency.
Current wording
On April 23, 2026, we received a letter from the Listing Qualifications Staff of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that, based upon the closing bid price of the Company’s Class A common stock for the last 30 consecutive business days, we no longer meet Nasdaq Listing Rule 5550(a)(2), which requires listed companies to maintain a minimum bid price of at least $1 per share. Nasdaq Listing Rule 5810(c)(3)(A) provides a compliance period of 180 calendar days, or until October 20, 2026, in which to regain compliance with the minimum bid price requirement. If we evidence a closing bid price of at least $1 per share for a minimum of 10 consecutive business days during the 180-day compliance period, we will automatically regain compliance. In the event we do not regain compliance with the $1 bid price requirement by October 14, 2026, we may be eligible for consideration of a second 180-day compliance period if the continued listing requirement for market value of publicly held shares and all other initial listing standards for Nasdaq’s Capital Market is met, other than the minimum bid price requirement. In addition, we would also be required to notify Nasdaq of our intent to cure the minimum bid price deficiency.
Previous wording
We regularly review a number of metrics, including the following key operating and financial metrics, to evaluate our business, measure our performance, identify trends in our business, prepare financial projections and make strategic decisions. We believe the operating and financial metrics presented below are useful in evaluating our operating performance, as they are similar to measures by our public competitors and are regularly used by security analysts, institutional investors and other interested parties in analyzing operating performance and prospects. Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP measures, as they are not financial measures calculated in accordance with GAAP and should not be considered as substitutes for net (loss) income or net (loss) income margin, respectively, calculated in accordance with GAAP. See*“Non-GAAP Financial Measures*” for additional information on non-GAAP financial measures and a reconciliation of these non-GAAP measures to the most comparable GAAP measures.
Current wording
We regularly review a number of metrics, including the following key operating and financial metrics, to evaluate our business, measure our performance, identify trends in our business, prepare financial projections and make strategic decisions. We believe the operating and financial metrics presented below are useful in evaluating our operating performance, as they are similar to measures by our public competitors and are regularly used by security analysts, institutional investors and other interested parties in analyzing operating performance and prospects. Adjusted EBITDA and Adjusted EBITDA margin are “non-GAAP” measures, as they are not financial measures calculated in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and should not be considered as substitutes for net (loss) income or net (loss) income margin, respectively, calculated in accordance with GAAP. See*“Non-GAAP Financial Measures*” below for additional information on non-GAAP financial measures and a reconciliation of these non-GAAP measures to the most comparable GAAP measures.
Previous wording
We define contribution profit as revenue, net less direct costs of revenue, commissions expense and depreciation and amortization, and define contribution margin, expressed as a percentage, as the ratio of contribution profit to revenue, net. Contribution profit and margin can be used to understand our financial performance and efficiency and allows investors to evaluate our pricing strategy and compare against competitors. Our management uses these metrics to make strategic decisions, identify areas for improvement, set targets for future performance and make informed decisions about how to allocate resources going forward. Contribution margin reflects our Contribution profit as a percentage of revenues. See “—Non-GAAP Financial Measures” for a reconciliation of Gross Profit to Contribution Profit and Contribution Margin.
Current wording
We define contribution profit as revenue, net less direct costs of revenue, commissions expense and depreciation and amortization, and define contribution margin, expressed as a percentage, as the ratio of contribution profit to revenue, net. Contribution profit and margin can be used to understand our financial performance and efficiency and allows investors to evaluate our pricing strategy and compare against competitors. Our management uses these metrics to make strategic decisions, identify areas for improvement, set targets for future performance and make informed decisions about how to allocate resources going forward. See “—Non-GAAP Financial Measures” for a reconciliation of Gross Profit to Contribution Profit and Contribution Margin.
Previous wording
We define Adjusted EBITDA, a non-GAAP financial measure, as earnings (loss) before interest expense, income tax expense (benefit), depreciation and amortization, other income (expenses), net, and stock compensation, as adjusted to exclude merger transaction related expenses. Adjusted EBITDA margin reflects our Adjusted EBITDA as a percentage of revenues. See “—Non-GAAP Financial Measures” for a reconciliation of GAAP net loss to Adjusted EBITDA and Adjusted EBITDA Margin.
Current wording
We define Adjusted EBITDA, a non-GAAP financial measure, as net income (loss) before interest and other income (expense), net, income tax provision (benefit), depreciation and amortization, gain (loss) on change in fair value of derivative liability, gain (loss) on change in fair value of warrant liabilities, stock-based compensation, and transaction-related expenses. Adjusted EBITDA margin reflects our Adjusted EBITDA as a percentage of revenues. See “—Non-GAAP Financial Measures” for a reconciliation of GAAP net loss to Adjusted EBITDA and Adjusted EBITDA Margin.
Previous wording
Expansion of Residential Sales into New Markets. Our future revenue growth is, in part, dependent on our ability to expand our product offerings and services in the select residential markets where we operate primarily in Florida, Texas, Illinois, Virginia and Ohio. We primarily generate revenue from our product offerings and services in the residential housing market. To continue our growth, we intend to expand our presence in the residential market into additional states based on markets underserved by national sales and installation providers that also have favorable incentives and net metering policies. We believe that our entry into new markets will continue to facilitate revenue growth and customer diversification.
Current wording
Expansion of Residential Sales into New Markets. Our future revenue growth is, in part, dependent on our ability to expand our product offerings and services in the select residential markets where we operate primarily in Florida, Texas, Ohio, Illinois, and Virginia. We primarily generate revenue from our product offerings and services in the residential housing market. To continue our growth, we intend to expand our presence in the residential market into additional states based on markets underserved by national sales and installation providers that also have favorable incentives and net metering policies, and where homeowners have favorable financing options. We believe that our entry into new markets will continue to facilitate revenue growth and customer diversification.
Previous wording
Expansion of New Products and Services. In 2026, we continued our roofing replacements to facilitate our solar installations and to repair rooftops on homes in Florida damaged by severe weather. We plan to expand our roofing business in all markets we enter in the future. Roofing facilitates a faster processing time for our solar installations in cases where the customer is in need of a roof replacement prior to installing a solar system. In addition, to provide more financing options for our prospective residential solar energy customers, we have programs in place that allow our customers to choose a leasing option to finance their systems from a third party.
Current wording
Expansion of New Products and Services. In 2026, we continued our roofing replacements to facilitate our solar installations and to repair rooftops. We will continue to provide roofing services in all markets in which we install solar systems. Roofing facilitates a faster processing time for our solar installations in cases where the customer is in need of a roof replacement prior to installing a solar system. In addition, to provide more financing options for our prospective residential solar energy customers, we have programs in place that allow our customers to choose a leasing option to finance their systems from a third party.
Previous wording
Following the acquisition of Heliogen in August 2025, the Company has been working to integrate Heliogen’s concentrated solar power and energy storage technology into its clean-energy platform to complement its existing solar operations, create operational synergies, and broaden market reach. The Company continues to pursue engineering services agreements to support long-duration energy storage projects.
Current wording
Following the acquisition of Heliogen in August 2025, we have been working to integrate Heliogen’s concentrated solar power and energy storage technology into our clean-energy platform to complement our existing solar operations, create operational synergies, and broaden market reach. We continue to pursue engineering services agreements to support long-duration energy storage projects.
Previous wording
Adding New Customers and Expansion of Sales with Existing Customers. We intend to increase our in-house sales force and external sales dealers in order to target new customers in the Southern U.S. regional residential markets. We provide competitive compensation packages to our in-house sales teams and external sales dealers, which incentivizes the acquisition of new customers.
Current wording
Adding New Customers and Expansion of Sales with Existing Customers. We intend to increase external sales dealers in order to target new customers in the markets we serve. We provide competitive compensation packages to our in-house sales teams and external sales dealers, which incentivizes the acquisition of new customers.
Previous wording
Interest rates. Interest rates increased sharply in 2022 but have been relatively stable since. The majority of homeowners have opted to enter into a lease contract with a third-party operator as means of financing the installation of a solar system. The lease contract provides a lower monthly cost to the homeowner than a conventional loan product in a higher interest rate environment. We do not have information that allows us to quantify the adverse effects attributable to increased interest rates.
Current wording
Interest rates. Interest rates increased sharply in 2022 but have been relatively stable since. The majority of homeowners have opted to enter into a lease contract with a third-party operator as a means of financing the installation of a solar system. The lease contract provides a lower monthly cost to the homeowner than a conventional loan product in a higher interest rate environment. We do not have information that allows us to quantify the adverse effects attributable to increased interest rates.
Previous wording
The volume of sales and installations of rooftop solar systems, our primary product, increase from April to September when a majority of our sales teams are most active in our areas of service. In addition to sales of solar systems, “adders” or accessories to a sale may include roofing, energy efficient appliances, upgraded insulation and/or energy storage systems. All adders consisted of less than 10% of the total revenues, net for the three months ended March 31, 2026 and 2025.
Current wording
The volume of sales and installations of rooftop solar systems, our primary product, increases from April to September when a majority of our sales teams are most active in our areas of service. In addition to sales of solar systems, “adders” or accessories to a sale may include roofing, energy efficient appliances, smart home security systems, upgraded insulation and/or energy storage systems. Adders represented less than 10% of total net revenues for each of the six months ended June 30, 2026 and 2025.
Previous wording
Our revenue is affected by changes in the volume, system size and average selling prices of our solutions and related accessories, supply and demand, sales incentives and fluctuating interest rates that increase or decrease the monthly payments for customers purchasing systems through third party financing. Less than 5% of our sales were paid in cash by the customer in each of the three months ended March 31, 2026 and 2025. Our revenue growth is dependent on our ability to compete effectively in the marketplace by remaining cost competitive, developing and introducing new sales teams within existing and new territories, scaling our installation teams to keep up with demand and maintaining a strong internal operations team to process orders while working with building departments and utilities to permit and interconnect our customers to the utility grid.
Current wording
Our revenue is affected by changes in the volume, system size and average selling prices of our solutions and related accessories, supply and demand, sales incentives and fluctuating interest rates that increase or decrease the monthly payments for customers purchasing systems through third party financing. Less than 5% of our sales were paid in cash by the customer in each of the six months ended June 30, 2026 and 2025. Our revenue growth is dependent on our ability to compete effectively in the marketplace by remaining cost competitive, developing and introducing new sales teams within existing and new territories, scaling our installation teams to keep up with demand and maintaining a strong internal operations team to process orders while working with building departments and utilities to permit and interconnect our customers to the utility grid.
Previous wording
Revenues improved during the three months ended March 31, 2026 compared to the three months ended March 31, 2025, driven by increased solar system installation activity. While higher consumer financing rates continue to present headwinds for the residential solar industry broadly, the Company has managed these pressures through expanded sales efforts and continued growth in its installation volume.
Current wording
Revenues improved during the six months ended June 30, 2026 compared to the six months ended June 30, 2025, driven by increased solar system installation activity. While higher consumer financing rates continue to present headwinds for the residential solar industry broadly, the Company has managed these pressures through expanded sales efforts and continued growth in its installation volume.
Previous wording
Cost of revenues increased during three months ended March 31, 2026 in association with the increase in revenues.
Current wording
Cost of revenues increased during the six months ended June 30, 2026 in association with the increase in revenues.
Previous wording
Other income (expense) primarily consists of change in fair value of warrant liabilities and interest expense and fees under our equipment and vehicle term loans. It also includes interest income on our cash and note receivable balances.
Current wording
Other income (expense) primarily consists of changes in fair value of our warrant liabilities and the embedded derivative liability related to the Convertible Note, interest expense on the Convertible Note (including amortization of the debt discount) and under our equipment and vehicle term loans, and interest income on our cash and note receivable balances.
Previous wording
General and administrative expenses decreased by $3.2 million from $9.5 million for the three months ended March 31, 2025 to $6.3 million for the three months ended March 31, 2026. The decrease was primarily driven by significant reductions in bad debt expense and stock-based compensation expense compared to the prior period.
Current wording
General and administrative expenses increased by $1.1 million from $4.9 million for the three months ended June 30, 2025 to $5.9 million for the three months ended June 30, 2026. The increase was primarily driven by increased bad debt expense and professional fees, offset by decreased stock-based compensation expense and transaction-related expenses compared to the prior period.
Previous wording
Other income (expense), net decreased by $0.7 million from other income, net of $0.7 million for the three months ended March 31, 2025 to other expense, net of $18,316 for the three months ended March 31, 2026. The decrease was primarily a result of a significant gain on change in fair value of warrant liabilities for the three months ended March 31, 2025 and a loss on change in fair value of warrant liabilities for the three months ended March 31, 2026.
Current wording
Other income (expense), net increased by $0.3 million from other expense, net of $12,952 for the three months ended June 30, 2025 to other income, net of $0.3 million for the three months ended June 30, 2026. The increase was primarily a result of a gain on change in fair value of derivative liability and warrant liabilities during the three months ended June 30, 2026, compared to a loss on change in fair value of warrant liabilities during the three months ended June 30, 2025.
Previous wording
Net revenues increased by approximately $4.4 million from $8.8 million for the three months ended March 31, 2025 to $13.2 million for the three months ended March 31, 2026. The increase in revenue was primarily driven by growth in solar system installations during the current period, partially offset by a decrease in related party revenue from Solar Leasing I, LLC (“SLI”). There were no revenues generated from the Heliogen segment during the three months ended March 31, 2026 and 2025.
Current wording
Net revenues increased by approximately $2.5 million from $26.9 million for the six months ended June 30, 2025 to $29.4 million for the six months ended June 30, 2026. The increase in revenue was primarily driven by growth in solar system installations during the current period, partially offset by a decrease in related party revenue from SLI. There were no revenues generated from the Heliogen segment during the six months ended June 30, 2026 and 2025.
Previous wording
Cost of revenues increased by $2.8 million from $4.8 million for the three months ended March 31, 2025 to $7.6 million for the three months ended March 31, 2026, primarily driven by the increase in solar system installation activity during the current period. As a percentage of net revenues, cost of revenues increased slightly from 54.5% for the three months ended March 31, 2025 to 57.5% for the three months ended March 31, 2026, reflecting a compression in gross margin year-over-year.
Current wording
Cost of revenues increased by $4.0 million from $12.1 million for the six months ended June 30, 2025 to $16.1 million for the six months ended June 30, 2026, primarily driven by the increase in solar system installation activity during the current period. As a percentage of net revenues, cost of revenues increased from 44.9% for the six months ended June 30, 2025 to 54.9% for the six months ended June 30, 2026, reflecting a compression in gross margin year-over-year primarily driven by higher material costs, offset by some improvements to labor and other costs.
Previous wording
Depreciation and amortization decreased by $3.8 million, from $4.9 million for the three months ended March 31, 2025 to $1.1 million for the three months ended March 31, 2026. The decrease was primarily related to $4.6 million in amortization of the customer-related intangible asset acquired in connection with the Lumio asset acquisition, which was fully amortized during 2025. This was offset by the $0.8 million of accelerated depreciation associated with the abandonment of software during the three months ended March 31, 2026.
Current wording
Depreciation and amortization decreased by $6.7 million, from $8.1 million for the six months ended June 30, 2025 to $1.3 million for the six months ended June 30, 2026. The decrease was primarily related to $7.6 million in amortization of the customer-related intangible asset acquired in connection with the Lumio asset acquisition, which was fully amortized during 2025. This was partially offset by $0.8 million of accelerated depreciation associated with the abandonment of internally developed software during the six months ended June 30, 2026.
Previous wording
Our operations have historically been funded through a combination of revenue generation, proceeds from financing activities, and in 2025, net cash acquired in connection with the Heliogen acquisition. Our primary short-term requirements for liquidity and capital are to fund general working capital and capital expenses, including through our common stock purchase agreement with White Lion Capital LLC (the “White Lion ELOC”). Our principal long-term working capital uses include ensuring revenue growth, expanding our sales and marketing efforts and potential acquisitions.
Current wording
Our operations have historically been funded through a combination of revenue generation, proceeds from financing activities, and in 2025, net cash acquired in connection with the Heliogen acquisition. Our primary short-term requirements for liquidity and capital are to fund general working capital and capital expenses, including through our common stock purchase agreement with White Lion (the “White Lion ELOC”). Our principal long-term working capital uses include ensuring revenue growth, expanding our sales and marketing efforts and potential acquisitions.
Previous wording
As of March 31, 2026 and December 31, 2025, our cash and cash equivalents balance were $1.7 million and $6.1 million, respectively. The Company maintains its cash in checking, savings, and money market accounts.
Current wording
As of June 30, 2026 and December 31, 2025, our cash and cash equivalents balances were $2.5 million and $6.1 million, respectively. The Company maintains its cash in checking, savings, and money market accounts.
Previous wording
We have operational plans to increase revenue and move towards the goal of profitable operations in 2026, which plans are expected to improve cash flows. Our operational plan includes an increase in the number of sales agents to increase revenue and improved efficiency in our operations through centralization of field offices and labor and productivity improvement in the corporate operations through the implementation of a new CRM software.
Current wording
We have operational plans to increase revenue and move towards the goal of profitable operations in the foreseeable future, which plans are expected to improve cash flows. Our operational plan includes an increase in the number of sales agents to increase revenue and improved efficiency in our operations through centralization of field offices and labor and productivity improvement in the corporate operations through the implementation of a new CRM software.
Previous wording
We are also working internally and with third parties to address short-term cash needs, including through the use of the White Lion ELOC, which provides us with the right to sell up to $30.0 million in shares of our Class A common stock, subject to market liquidity and contractual limitations. The White Lion ELOC is limited to selling shares equal to 4.99% of the outstanding shares at the time of sale and resets once White Lion Capital LLC (i.e., once White Lion Capital liquidates their holdings in the open market). We believe we also have other opportunities to raise capital, such as through revenue generating initiatives, private placements, public offerings or repricing of outstanding warrants. In addition, in June 2026, we will become eligible to utilize a universal shelf registration statement to raise funding for our company.
Current wording
We are also working internally and with third parties to address short-term cash needs, including through the use of the White Lion ELOC, which provides us with the right to sell up to $30.0 million in shares of our Class A common stock, subject to market liquidity and contractual limitations. The White Lion ELOC is limited to selling shares equal to 4.99% of the outstanding shares at the time of sale, and this limitation resets once White Lion liquidates its holdings in the open market. The amount we can raise under the White Lion ELOC in any period is practically limited by the trading volume and market price of our Class A common stock and the number of shares registered for resale; based on the shares currently registered and recent market prices, we estimate that approximately $6.5 million is currently accessible under the facility. We believe we also have other opportunities to raise capital, such as through revenue generating initiatives, private placements, public offerings or repricing of outstanding warrants. In addition, we may utilize a universal shelf registration statement to gain access to funding for our company.
Previous wording
While our plan and expectation is to raise additional capital in 2026, and while we are routinely active in discussions and planning for financing, there can be no assurance that we will be successful in such pursuits, and our fundraising efforts are subject to a variety of uncertainties. Moreover, even if we are able to raise additional capital, other than the While Lion ELOC, we do not know with precision what the terms of any such financing would be. Any future sale of our equity securities would dilute the ownership and control of your shares and could be at prices below prices at which investors acquired our shares or at which our shares currently trade. The sale of convertible debt securities or additional equity securities could result in additional dilution to our shareholders. Also, the incurrence of indebtedness would result in increased debt service obligations and could result in operating and financing covenants that would restrict our operations and liquidity and ability to pay dividends. Our inability to raise capital, coupled with our inability to generate adequate cash from operations, could require us to significantly modify our operational plans, and any failure to raise additional funds on favorable terms when needed could have a material adverse effect on our business, liquidity and financial condition.
Current wording
While our plan and expectation is to raise additional capital in 2026, and while we are routinely active in discussions and planning for financing, there can be no assurance that we will be successful in such pursuits, and our fundraising efforts are subject to a variety of uncertainties. Moreover, even if we are able to raise additional capital, other than the White Lion ELOC, we do not know with precision what the terms of any such financing would be. Any future sale of our equity securities would dilute the ownership and control of your shares and could be at prices below prices at which investors acquired our shares or at which our shares currently trade. The sale of convertible debt securities or additional equity securities could result in additional dilution to our shareholders. Also, the incurrence of indebtedness would result in increased debt service obligations and could result in operating and financing covenants that would restrict our operations and liquidity and ability to pay dividends. Our inability to raise capital, coupled with our inability to generate adequate cash from operations, could require us to significantly modify our operational plans, and any failure to raise additional funds on favorable terms when needed could have a material adverse effect on our business, liquidity and financial condition.
Previous wording
Net cash used in operating activities was approximately $0.9 million during the three months ended March 31, 2026 compared to approximately $2.3 million during the three months ended March 31, 2025. The $1.4 million improvement in operating cash flows was driven primarily by favorable working capital changes, including a $1.3 million increase in accounts payable and a $3.8 million increase in accrued expenses and other current liabilities – related parties, and a $0.2 million decrease in prepaid expenses and other current assets. These improvements were partially offset by a $2.4 million increase in accounts receivable, a $0.7 million decrease in contract liabilities, and a $0.5 million decrease in accrued expenses and other current liabilities. Non-cash charges also decreased significantly year-over-year, with depreciation and amortization of $1.1 million, stock-based compensation of $0.7 million, and provision for credit losses of $0.2 million in the current period, compared to $4.9 million, $2.2 million, and $3.5 million, respectively, in the prior year period, reflecting the significant reduction in operating activity from the prior year period. In addition to the previously mentioned changes in operating cash flows, the Heliogen segment that was acquired in the quarter ended September 30, 2025, incurred a net loss of $0.9 million for the three months ended March 31, 2026 that is included in net loss compared to no impact on net loss for the three months ended March 31, 2025.
Current wording
Net cash used in operating activities was approximately $1.3 million during the six months ended June 30, 2026 compared to approximately $4.5 million during the six months ended June 30, 2025. The $3.2 million improvement in operating cash flows was driven primarily by the lower net loss in the current period and favorable working capital changes, including a $3.7 million increase in customer advances – related party and a $1.0 million increase in accounts payable. These improvements were partially offset by a $2.0 million increase in accounts receivable, including accounts receivable – related party, and a $1.1 million decrease in contract liabilities. Non-cash charges also decreased significantly year-over-year, with depreciation and amortization of $1.3 million, stock-based compensation of $1.3 million, and provision for credit losses of $0.5 million in the current period, compared to $8.1 million, $3.3 million, and $3.3 million, respectively, in the prior year period. In addition, the Heliogen segment, which was acquired in the quarter ended September 30, 2025, incurred a net loss of $1.8 million for the six months ended June 30, 2026 that is included in net loss, compared to no impact on net loss for the six months ended June 30, 2025.
Previous wording
Net cash used in investing activities was approximately $3.4 million for the three months ended March 31, 2026 relating to the note receivable – related-party investment and purchases of property and equipment. Net cash used in investing activities was approximately $0.4 million for the three months ended March 31, 2025, relating to purchases of property and equipment.
Current wording
Net cash used in investing activities was approximately $3.6 million for the six months ended June 30, 2026, relating to a $3.2 million investment in the note receivable – related party and $0.4 million of purchases of property and equipment. Net cash used in investing activities was approximately $0.8 million for the six months ended June 30, 2025, relating to purchases of property and equipment.
Previous wording
Net cash used in financing activities was approximately $0.2 million for the three months ended March 31, 2026 relating to the payment of dividends to OpCo Class A preferred unit holders, repayments of debt and finance leases, and tax withholding paid related to stock-based compensation, offset by net proceeds received in connection with the White Lion RRA. Net cash used in financing activities was approximately $0.1 million for the three months ended March 31, 2025, relating to repayments of debt and finance leases.
Current wording
Net cash provided by financing activities was approximately $1.2 million for the six months ended June 30, 2026, consisting primarily of $1.4 million of net proceeds from the Convertible Note, partially offset by dividends paid to OpCo Class A preferred unit holders, repayments of debt and finance lease liabilities, and tax withholdings paid related to stock-based compensation. Net cash used in financing activities was approximately $0.2 million for the six months ended June 30, 2025, relating to repayments of debt and finance lease liabilities.
Previous wording
We define contribution profit as revenue, net less direct costs of revenue, commissions expense and depreciation and amortization, and define contribution margin, expressed as a percentage, as the ratio of contribution profit to revenue, net. Contribution profit and margin can be used to understand our financial performance and efficiency and allows investors to evaluate our pricing strategy and compare against competitors. Our management uses these metrics to make strategic decisions, identify areas for improvement, set targets for future performance and make informed decisions about how to allocate resources going forward. Contribution margin reflects our Contribution profit as a percentage of revenues.
Current wording
We define contribution profit as revenue, net less direct costs of revenue, commissions expense and depreciation and amortization, and define contribution margin, expressed as a percentage, as the ratio of contribution profit to revenue, net. Contribution profit and margin can be used to understand our financial performance and efficiency and allows investors to evaluate our pricing strategy and compare against competitors. Our management uses these metrics to make strategic decisions, identify areas for improvement, set targets for future performance and make informed decisions about how to allocate resources going forward.
Previous wording
We define Adjusted EBITDA, a non-GAAP financial measure, as net income (loss) before interest and other income (expense), net, income tax provision (benefit), depreciation and amortization, gain (loss) on change in fair value of warrant liabilities, stock-based compensation, and non-recurring transaction-related expenses. We utilize Adjusted EBITDA as an internal performance measure in the management of our operations because we believe the exclusion of these non-cash and non-recurring charges allow for a more relevant comparison of our results of operations to other companies in our industry. Adjusted EBITDA should not be viewed as a substitute for net income (loss) calculated in accordance with GAAP, and other companies may define Adjusted EBITDA differently. Adjusted EBITDA margin reflects our Adjusted EBITDA as a percentage of revenues. The following table provides a reconciliation of net income (loss) to Adjusted EBITDA for the periods presented:
Current wording
We define Adjusted EBITDA, a non-GAAP financial measure, as net income (loss) before interest and other income (expense), net, income tax provision (benefit), depreciation and amortization, gain (loss) on change in fair value of derivative liability, gain (loss) on change in fair value of warrant liabilities, stock-based compensation, and transaction-related expenses. We utilize Adjusted EBITDA as an internal performance measure in the management of our operations because we believe the exclusion of these items allows for a more relevant comparison of our results of operations to other companies in our industry. Adjusted EBITDA should not be viewed as a substitute for net income (loss) calculated in accordance with GAAP, and other companies may define Adjusted EBITDA differently. Adjusted EBITDA margin reflects our Adjusted EBITDA as a percentage of revenues. The following table provides a reconciliation of net income (loss) to Adjusted EBITDA for the periods presented:
Previous wording
For a description of our critical accounting policies and estimates, refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Estimates” in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on April 1, 2026. There have been no material changes to our critical accounting policies and estimates since our Annual Report on Form 10-K for the year ended December 31, 2025.
Current wording
For a description of our critical accounting policies and estimates, refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Estimates” in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on April 1, 2026. There have been no material changes to our critical accounting policies and estimates since our Annual Report on Form 10-K for the year ended December 31, 2025, besides the following:
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
Net revenues decreased by approximately $1.9 million from $18.1 million for the three months ended June 30, 2025 to $16.2 million for the three months ended June 30, 2026. The decrease in revenue was primarily driven by a decrease in related party revenue from Solar Leasing I, LLC (“SLI”), partially offset by an increase in revenue from unrelated third-party customers. There were no revenues generated from the Heliogen segment during the three months ended June 30, 2026 or 2025.
Current report — wording carried from elsewhere
Depreciation and amortization decreased by $3.0 million, from $3.2 million for the three months ended June 30, 2025 to $0.2 million for the three months ended June 30, 2026. The decrease was primarily related to $2.9 million in amortization of the customer-related intangible asset acquired in connection with the Lumio asset acquisition, which was fully amortized during 2025.
Current report — wording carried from elsewhere
The following table sets forth a summary of our condensed consolidated statements of operations for the periods presented: