Aqua Metals, Inc.

Previous wording

In February 2023, we acquired a five-acre parcel of land with an existing building to begin development of our Li AquaRefining recycling campus at TRIC. Subsequent to the end of the first quarter of 2025, we entered into contract to sell the current Sierra ARC property. The action retires all debt, adds cash to the balance sheet and reduces holding costs. The company will now evaluate more cost-efficient locations for future development. We are working closely with prospective strategic materials and financial partners to explore co-location opportunities near feedstock and offtake sources, which could lower capital expenditures and future operating expenses.

Current wording

In February 2023, we acquired a five-acre parcel of land with an existing building to begin development of our Li AquaRefining recycling campus at TRIC. During the second quarter of 2025, we sold the Sierra ARC property. The action retired all debt, added cash to the balance sheet and reduced holding costs. The company will now evaluate more cost-efficient locations for future development. We are working closely with prospective strategic materials and financial partners to explore co-location opportunities near feedstock and offtake sources, which could lower capital expenditures and future operating expenses.

Previous wording

During the three months ended March 31, 2025, we issued 596,487 shares of common stock pursuant to an at the market, or ATM, sales agreement for net proceeds of $1,214,000. During the year ended December 31, 2024, we issued 1,195,033 shares of common stock pursuant to the ATM facility for net proceeds of $5,014,000. In May 2024, we completed a public offering of 1,006,250 shares of our common stock, at the public offering price of $7.80 per share. In connection with the sale of common stock, we issued warrants to purchase shares of common stock at the rate of one warrant for every share of purchased common stock, at the price of $0.20 per share. After the deduction of the underwriter’s discount and expenses payable by us, we received net proceeds of $7,306,000.

Current wording

During the six months ended June 30, 2025, we issued 211,474 shares of common stock pursuant to an at the market, or ATM, sales agreement for net proceeds of $2,735,000. During the year ended December 31, 2024, we issued 119,503 shares of common stock pursuant to the ATM facility for net proceeds of $5,014,000. In May 2024, we completed a public offering of 100,625 shares of our common stock, at the public offering price of $78 per share. In connection with the sale of common stock, we issued warrants to purchase shares of common stock at the rate of one warrant for every share of purchased common stock, at the price of $2 per share. After the deduction of the underwriter’s discount and expenses payable by us, we received net proceeds of $7,306,000.

Previous wording

Effective November 5, 2024, we effected a one-for-20 reverse stock split of our issued and outstanding common shares. All share and share price information set forth in this report has been adjusted retrospectively to reflect this reverse stock split.

Current wording

Effective November 5, 2024, we effected a one-for-20 reverse stock split of our issued and outstanding common shares. Subsequently, on August 4, 2025, we effected a one-for-10 reverse stock split of our issued and outstanding common shares. All share and share price information set forth in this report has been adjusted retrospectively to reflect these reverse stock splits.

Previous wording

We did not engage in commercial operations in 2025 or 2024. Our operations have been devoted to developing our Li AquaRefining battery recycling technology. During the three months ended March 31, 2025, Aqua Metals was focused on the continued operation of the pilot facility and advancing the underlying processes that support our recycling capabilities. We did not earn any revenue during the three months ended March 31, 2025 and 2024. The following table summarizes our results of operations with respect to the items set forth below for the three months ended March 31, 2025 and 2024 together with the dollar and percentage changes in those items (in thousands).

Current wording

We did not engage in commercial operations in 2025 or 2024. Our operations have been devoted to developing our Li AquaRefining battery recycling technology. During the six months ended June 30, 2025, Aqua Metals was focused on the continued operation of the pilot facility and advancing the underlying processes that support our recycling capabilities. We did not earn any revenue during the three and six months ended June 30, 2025 and 2024. The following table summarizes our results of operations with respect to the items set forth below for the three and six months ended June 30, 2025 and 2024 together with the dollar and percentage changes in those items (in thousands).

Previous wording

Plant operations include materials, supplies related costs, salaries and benefits, consulting, outside services costs, inventory adjustments, depreciation, amortization, insurance, travel and overhead costs. Plant operations decreased approximately $1,485,000, or 67.2%, for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024. The decrease was primarily driven by a reduction in payroll and related costs of approximately $786,000, resulting from workforce reductions implemented in August 2024 and continued reductions during the first quarter of 2025. Additionally, professional fees decreased by approximately $390,000 and supplies, materials, inventory adjustments and other overhead expenses decreased by $309,000. Management does not expect the reduction in force to materially impact its current pilot operations or continuing research and development. However, until additional funding is secured, we anticipate employee-related and overhead expenses will stay at the reduced level during 2025.

Current wording

Plant operations include materials, supplies related costs, salaries and benefits, consulting, outside services costs, inventory adjustments, depreciation, amortization, insurance, travel and overhead costs. Plant operations decreased approximately $1,597,000, or 67.3%, and $3,081,000, or 67.2%, for the three and six months ended June 30, 2025 as compared to the three and six months ended June 30, 2024. The decrease in plant operations for the three months ended June 30, 2025 was primarily driven by a reduction in payroll and related costs of approximately $1,149,000, resulting from workforce reductions implemented in August 2024 and continued reductions during the first quarter of 2025. Additionally, professional fees decreased by approximately $155,000 and supplies, materials, inventory adjustments and other overhead expenses decreased by $293,000. The decrease in plant operations for the six month ended June 30, 2025 was primarily due to a decrease in payroll and payroll related fees of approximately $1,935,000 resulting from workforce reductions, professional fees decreased by approximately $544,000 and a decrease of $602,000 in other overhead expenses, including supplies, materials and inventory adjustments. Management does not expect the reduction in force to materially impact its current pilot operations or continuing research and development. However, until additional funding is secured, employee-related and overhead expenses are expected to remain at the reduced levels throughout the remainder of 2025.

Previous wording

Research and development cost includes expenditures related to the continued enhancement of the AquaRefining technology and the development of our lithium-ion battery recycling process. During the three months ended March 31, 2025, research and development expenses decreased $252,000, or approximately 42.9%, compared to the three months ended March 31, 2024. This decrease was primarily due to lower payroll and related costs of approximately $172,000, as well as reduction in professional fees of approximately $25,000 and a reduction in supplies, materials, and other overhead expenses of approximately $55,000.

Current wording

Research and development cost includes expenditures related to the continued enhancement of the AquaRefining technology and the development of our lithium-ion battery recycling process. During the three months ended June 30, 2025, research and development expenses decreased $68,000, or approximately 18.7%, compared to the three months ended June 30, 2024, and $320,000, or approximately 33.6%, for the six months ended June 30, 2025 compared to the six months ended June 30, 2024. This decrease, six months ended June 30, 2025 compared to the six months ended June 30, 2024 was primarily due to lower payroll and related costs of approximately $229,000, as well as a reduction in supplies, materials, and other overhead expenses of approximately $111,000 off set by an increase in professional fees of approximately $20,000.

Previous wording

The following table summarizes our other income and interest expense for the three months ended March 31, 2025 and 2024 together with the dollar and percentage changes in those items (in thousands).

Current wording

The following table summarizes our other income and interest expense for the three and six months ended June 30, 2025 and 2024 together with the dollar and percentage changes in those items (in thousands).

Previous wording

The increase in interest expense for the three months ended March 31, 2025 is due to the increase in the notes payable outstanding balance and an increase in the amortization of the related debt discount.

Current wording

The increase in interest expense for the three and six months ended June 30, 2025 is due to the increase in the notes payable outstanding balance and an increase in the amortization of the related debt discount.

Previous wording

We recognized approximately $280,000 in interest and other income during the three months ended March 31, 2025, an increase of $134,000 or 91.8% compared to the three months ended March 31, 2024. The increase was primarily driven by the approval of a payroll tax employee retention credit in the first quarter of 2025.

Current wording

We recognized approximately $497,000 and $777,000 in interest and other income during the three and six months ended June 30, 2025, an increase of $398,000 and $532,000 compared to the three and six months ended June 30, 2024. The increase was primarily driven by the approval of a payroll tax employee retention credit.

Previous wording

For the three months ended March 31, 2025, the Company recognized a change in fair value of warrant liability of $491,000, which was primarily due to the remeasurement of the warrants issued in December 2024.

Current wording

For the three and six months ended June 30, 2025, the Company recognized a change in fair value of warrant liability of $836,000 and $1,327,000, which was primarily due to the remeasurement of the warrants issued in December 2024.

Previous wording

As of March 31, 2025, the Company had cash and cash equivalents of approximately $1,589,000, current liabilities of $7,164,000 and a working capital deficit of approximately $4,945,000. The Company's current liabilities of $7,164,000 include the note payable to Summit Investment Services, LLC* in the amount of approximately $3,000,000 due on July 27, 2025 and notes payable with eight accredited investors *in the amount of approximately $1,000,000 due on December 31, 2025 as disclosed in Note 10. The Company has not generated revenues from commercial operations and expects to continue incurring losses for the foreseeable future. In order to satisfy our capital requirements, the Company will need to improve its liquidity position through equity or debt financings and/or reductions in operating costs, in order to satisfy its liquidity needs for the next twelve months. Management is devoting significant efforts to increasing liquidity, raising capital and developing its business.

Current wording

As of June 30, 2025, the Company had cash and cash equivalents of approximately $1,933,000, current liabilities of $3,633,000 and a working capital deficit of approximately $1,264,000. The Company has not generated revenues from commercial operations and expects to continue incurring losses for the foreseeable future. In order to satisfy our capital requirements, the Company will need to improve its liquidity position through equity or debt financings and/or reductions in operating costs, in order to satisfy its liquidity needs for the next twelve months. Management is devoting significant efforts to increasing liquidity, raising capital and developing its business.

Previous wording

Net cash provided by (used in) operating activities

Current wording

Net cash used in operating activities

Previous wording

Net cash used in operating activities for the three months ended March 31, 2025 and three months ended March 31, 2024 was $2,753,000 and $4,251,000, respectively. Net cash used in or provided by operating activities during each of these periods consisted primarily of our net loss adjusted for non-cash items such as depreciation, amortization, stock-based compensation, and impairment on the disposal of property, plant and equipment, as well as net changes in working capital.

Current wording

Net cash used in operating activities for the six months ended June 30, 2025 and six months ended June 30, 2024 was $5,299,000 and $8,002,000, respectively. Net cash used in operating activities during each of these periods consisted primarily of our net loss adjusted for non-cash items such as depreciation, amortization, amortization of deferred financing costs, loss on extinguishment of debt, stock-based compensation, impairment and loss on disposal of property, plant and equipment, as well as net changes in working capital.

Previous wording

Net cash used in investing activities

Current wording

Net cash provided by (used in) investing activities

Previous wording

Net cash used in investing activities for the three months ended March 31, 2025 was $375,000 and consisted mainly of cash utilized towards equipment deposits of $186,000 and purchases of fixed assets related to the build out of our commercial facility of $289,000, offset by $100,000 of cash received related to our note receivable. Net cash used in investing activities for the three months ended March 31, 2024 was $5,579,000 and consisted mainly of cash utilized towards equipment deposits and purchases of fixed assets related to the build out of our commercial facility offset by $150,000 of cash received related to our note receivable

Current wording

Net cash provided by investing activities for the six months ended June 30, 2025 was $4,936,000 and consisted mainly of $4,347,000 cash received from the sale of the building and equipment, $1,141,000 from equipment deposits, the payment of our $100,000 related to our note receivable, offset by cash utilized towards equipment deposits of $231,000 and purchases of fixed assets of $421,000. Net cash used in investing activities for the six months ended June 30, 2024 was $9,762,000 and consisted mainly of cash utilized towards equipment deposits of $3,522,000 and purchases of fixed assets related to the build out of our commercial facility of $6,440,000, offset by $200,000 of cash received related to our note receivable.

Previous wording

Net cash provided by financing activities was $638,000 for the three months ended March 31, 2025, consisting of $1,214,000 in net proceeds from the sale of Aqua Metals shares pursuant to the at-the-market offering, or ATM, offset by $66,000 related to tax withholdings to cover RSU vesting and $500,000 principal payments on notes payable. Net cash provided by financing activities of $1,602,000 for the three months ended March 31, 2024 was approximately $2,126,000 in net proceeds from the sale of Aqua Metals shares pursuant to the at-the-market offering, or ATM, offset by $360,000 related to tax withholdings to cover RSU vesting and $164,000 related to debt issuance costs.

Current wording

Net cash used in financing activities was $1,783,000 for the six months ended June 30, 2025, consisting of $2,735,000 in net proceeds from the sale of Aqua Metals shares pursuant to the at-the-market offering, or ATM, and $69,000 of net proceeds from the sale of Aqua Metals shares pursuant to the equity-line-of-credit purchase agreement, or ELOC, with Lincoln Park Capital Fund, LLC offset by $66,000 related to tax withholdings to cover RSU vesting and $4,500,000 principal payments on notes payable. Net cash provided by financing activities of $9,075,000 for the six months ended June 30, 2024 consisted of $2,542,000 in net proceeds from the sale of Aqua Metals shares pursuant to the at-the-market offering, or ATM, and $7,306,000 in net proceeds from our May 2024 public offering, offset by $360,000 related to tax withholdings to cover RSU vesting and $413,000 related to debt issuance costs.