Eos Energy Enterprises, Inc.
For the period ended Mar 31, 2026. Filed May 13, 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.
Mar 31, 2026 · Filed May 13, 2026
EOSE$1.74-7.4%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 2025-11-05.
0001628280-25-049588
Item 2. Managements Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-13.
0001628280-26-034368
Item 2. Managements 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 110 previous paragraphs and 80 current paragraphs.
34 unchanged; 29 reworded; 16 added; 47 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 15 previous and 15 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 (16)
Current report
The Company has successfully transitioned to the Eos Z3 platform, enabled by the commissioning and commercial operation of its first fully automated battery manufacturing line. The Z3 leverages the same proven underlying chemistry, which has demonstrated durability over more than 3 million cycles, while incorporating a redesigned mechanical architecture that enhances performance, reduces costs and improves manufacturability. Z3 battery modules have been shipped since the third quarter of 2023, and the transition reflects over fifteen years of accumulated insights and operational experience. The Company believes this experience will continue to drive manufacturing efficiencies as production scales and its state‑of‑the‑art operations expand.
Current report
In 2025, the Company introduced DawnOS, a software platform designed to enhance the value, reliability and safety of the Company’s BESS. DawnOS builds upon the Z3 battery architecture through a fully integrated hardware and software solution. It serves as the system’s intelligence layer and is designed to manage large numbers of battery modules in real time. The platform provides precise balancing, dynamic switching and continuous system operation, including in situations where individual modules within a string become imbalanced. DawnOS is intended to increase usable energy per cycle, reduce field service requirements and operate with embedded security and automation features. Through its advanced control capabilities, the Company expects DawnOS to be an integral component of its product portfolio going forward, reflecting its role in improving system resilience, efficiency and overall operational performance.
Current report
In 2026, the Company introduced Eos Indensity, an energy storage architecture that uses a spatial intelligence design framework to provide high density storage with flexibility and safety in constrained as well as traditional sites. The system targets up to 1 GWh per acre, roughly four times most incumbent footprints, through stackable Indensity Core units that integrate Eos Z3 battery modules with the Eos DawnOS controls platform. The modular self contained form factor enables efficient transport, simplified installation and long term serviceability. Eos Indensity can be deployed indoors or outdoors, including inside existing buildings. It addresses long duration, response driven use cases across data centers, military bases, manufacturing facilities and critical infrastructure, supported by a domestic FEOC compliant supply chain. The Company expects Indensity to be an integral component of its product portfolio going forward.
Current report
•In January 2026, the Company introduced Eos Indensity, an energy storage architecture that uses a spatial intelligence design framework to provide high density storage with flexibility and safety in constrained as well as traditional sites. The system targets up to 1 GWh per acre, roughly four times most incumbent footprints, through stackable Indensity Core units that integrate Eos Z3 battery modules with the Eos DawnOS controls platform. The modular self contained form factor enables efficient transport, simplified installation and long term serviceability. Eos Indensity can be deployed indoors or outdoors, including inside existing buildings. It addresses long duration, response driven use cases across data centers, military bases, manufacturing facilities and critical infrastructure, supported by a domestic FEOC compliant supply chain.
Current report
•In March 2026, the Company announced the appointment of Nathaniel Fick to its Board of Directors as an independent Common Class III director.
Current report
•In April 2026, the Company announced a joint development agreement with TURBINE‑X Energy, Inc. to develop and deploy private power infrastructure for AI, a new model designed to deliver firm, dispatchable energy for hyperscale data centers and other mission-critical loads on accelerated timelines.
Current report
For the three months ended March 31, 2026, Revenue increased by $46.5 million or 445% from $10.5 million. The increase was primarily drive by an increase in deliveries, an increase in the average selling price and higher revenue from third-party materials. These increases were partially offset by a decline in service revenue.
Current report
Cost of goods sold increased by $66.4 million or 190% from $35.0 million. The increase in Cost of goods sold was driven by significantly higher cube deliveries, higher direct and indirect labor, higher field service costs associated with increased deliveries and higher volume-driven warranty accruals.
Current report
Research and development expenses increased $3.9 million or 57% for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. The increase was primarily attributable to higher facility, materials and supplies, outside services and payroll-related costs partially offset by lower stock-based compensation costs.
Current report
Selling, general and administrative expenses increased $3.1 million or 15% for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase was primarily attributable to higher facility, marketing, insurance and payroll-related costs, partially offset by lower legal fees and stock-based compensation costs.
Current report
Interest expense
Current report
Interest expense increased $11.3 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to an increased principal balance under the DOE Loan Facility and interest associated with the May 2025 Convertible Notes and November 2025 Convertible Notes, which were not outstanding as of March 31, 2025.
Current report
The Change in fair value of debt - related party is related to the DDTL. The Change in fair value of debt - related party of $4.2 million and $5.9 million for the three months ended March 31, 2026 and March 31, 2025, respectively, primarily reflects the accretion of the DDTL resulting from the passage of time.
Current report
The change for the three months ended March 31, 2026 and March 31, 2025 is largely driven by the Company's common stock price decrease quarter over quarter.
Current report
For the three months ended March 31, 2026, the Change in fair value of derivatives of $165.9 million related to the change in fair value of the embedded derivative associated with the November 2025 Convertible Notes. The change is largely driven by the Company’s common stock price decrease quarter over quarter. The November 2025 Convertible Notes were not outstanding for the comparable period for the three months ended March 31, 2025.
Current report
Liquidity and Capital Resources
Removed paragraphs (47)
Previous report
,MANAGEMENT’S DISCUSSION AND ANALYSIS OF
Previous report
The transition to the Eos Z3 is progressing as planned, with the first fully-automated battery manufacturing line now installed and in commercial production. The Z3 uses the same chemistry, known for its ability to endure over 3 million cycles, but introduces a new mechanical design aimed at improving performance, reducing costs, and enhancing manufacturability. The Company began delivering Z3 battery modules in the third quarter of 2023. The Z3 incorporates valuable lessons learned from the past fifteen years, which the Company expects will drive efficiencies as it scales its state-of-the-art manufacturing capabilities.
Previous report
U.S. Department of Energy (“DOE”)
Previous report
On November 26, 2024, the Company entered into the DOE Loan Facility. The DOE Loan Facility is a key step in advancing the Company's Project American Made Zinc Energy ("AMAZE") and is expected to fund the expansion of Eos’ manufacturing capacity to 8 GWh by 2027 to meet the growing demand for longer duration battery energy storage systems.
Previous report
The DOE Loan Facility provides for a multi draw term loan facility under a series of at least two and, if the Company elects, up to four tranches of the loan (each, a “Tranche”), subject to the achievement of certain funding conditions, with each Tranche corresponding to the production, maintenance and development, and operation of a given production line to be funded using the proceeds of such Tranche and the principal amount of each Tranche consisting of a maximum principal amount designated for such Tranche in the DOE Loan Facility. Each Tranche provides the Company funding for 80% of the Eligible Project Costs (as defined in the DOE Loan Facility) associated with the corresponding production line, with the Company responsible for funding the remaining 20% of the Eligible Project Costs.
Previous report
Through September 30, 2025, the Company has received funding under the DOE Loan Facility for an aggregate amount of $90.9 million. The initial draw of $68.3 million was made at an interest rate of 4.791%, for eligible project costs incurred through December 6, 2024. The second draw of $22.7 million was made at an interest rate of 4.286%, for eligible project costs incurred through June 4, 2025. These costs are a portion of Tranche 1 of the DOE Loan Facility. Tranche 1 provides up to $90.9 million for eligible costs in connection with the design, construction, installation, startup and shakedown of a battery automation line and related tools, with a projected annual production capacity of approximately 1.25 GWh ("Line 1"). The DOE Loan Facility provides for up to $303.5 million in funding, including capitalized interest. On June 12, 2025, the Company delivered to the DOE and the FFB a second advance request, and on July 1, 2025, the FFB funded $22.7 million under the DOE Loan Facility (the “second loan advance”).
Previous report
Inflation Reduction Act of 2022 (“IRA”)
Previous report
On August 16, 2022, President Biden signed the Inflation Reduction Act of 2022 into law. The IRA has significant economic incentives for both energy storage customers and manufacturers for projects placed in service after December 31, 2022. One of the most important features of the IRA is that it offers a 10-year term tax credit, whereas historically similar industrial credits have been shorter in duration. Customers placing new energy storage facilities in service, which include our Gen 2.3 and Z3™ BESS, could qualify for an investment tax credit (“ITC”). In December 2024, the IRS and U.S. Department of the Treasury published final regulations that clarified certain investment tax credit eligibility requirements for Section 48 energy investment tax credits that were enacted as part of the IRA. The IRA offers an extra ten percent credit if the project is in an “energy community” and another ten percent credit if the project satisfies domestic content requirements. The ten percent bonus for domestic content could represent a strategic advantage for the Company resulting from the Company’s near-sourcing and Made in America strategy, and we believe that projects utilizing Eos batteries qualify for the bonus and meet safe harbor requirements. The Company is observing accelerated customer activity in 2025 as customers seek to commence construction and incur qualifying costs prior to the end of 2025 in order to secure eligibility for the current ITC safe harbor provisions, before fully transitioning to the technology-neutral Section 48E framework effective for projects initiated thereafter.
Previous report
Production Tax Credits under Internal Revenue Code 45X (“PTC”) can be claimed on battery components manufactured in the U.S. and sold to U.S. or foreign customers. These tax credits available to manufacturers include a credit for ten percent of the cost incurred to make electrode active materials in addition to credits of $35 per kWh of capacity of battery cells and $10 per kWh of capacity of battery modules. These credits are cumulative, meaning that companies will be able to claim each of the available tax credits based on the battery components produced and sold through 2029, after which the PTC will begin to gradually phase down through 2032.
Previous report
The OBBBA also introduces new limitations related to the sourcing of materials from foreign entities of concern (“FEOCs”) starting after December 31, 2025. These provisions restrict eligibility for credits where material assistance is received from such entities. The Company is evaluating the future impact of the OBBBA; however, it does not anticipate a material impact from either the material sourcing or ownership-related provisions. The Company will evaluate additional guidance as it becomes available.
Previous report
•In January 2025, the Company successfully achieved all operational milestones that guaranteed the final $40.5 million under the fully funded $210.5 million Delayed Draw Term Loan ("DDTL") to further solidify its position as a leader in American energy storage systems. Successfully meeting these performance milestones will enable the Company to fuel its ongoing operations, U.S. production expansion, and the creation of an American energy storage powerhouse, without the need to raise additional capital via debt or additional equity offerings.
Previous report
•With the Delayed Draw Term Loan fully funded, combined with DOE Loan Facility's first disbursement in December 2024, Eos has a strong foundation and sufficient capital to continue implementing Project AMAZE. The Company is executing its strategy to scale production into strong customer demand for long duration energy storage. Cash from customer projects now play an important role in funding working capital and our American-made system can play a critical role in America achieving energy independence. The $210.5 million Delayed Draw Term Loan is now fully funded, driven by the Company consistently achieving key operational milestones related to the Company’s state-of-the-art manufacturing line, raw materials cost-out, Z3 technology performance improvement and orders backlog cash conversion. The Company surpassed its January raw materials cost-out target by 6% while delivering manufacturing cycle times below 10 seconds to further demonstrate continued operational efficiency and progress.
Previous report
•In March 2025, the Company announced an $8 million standalone BESS order for the Naval Base of San Diego. Fully funded by a grant from the California Energy Commission (“CEC”), this order highlights Eos’ critical role in supporting U.S. national security infrastructure with American-made energy storage.
Previous report
•In March 2025, the Company announced Nathan Kroeker’s transition from Chief Financial Officer role to become Eos' Chief Commercial Officer. Nathan's background as Chief Financial Officer gives him a unique advantage in understanding both the financial and commercial landscapes of the industry, allowing him to create customer-centric solutions that are not only impactful, but also financially sustainable.
Previous report
•In March 2025, the Company announced that Joseph Nigro, former CFO of Exelon Corporation (NADSDAQ: EXC) and CEO of Constellation Energy (then operating division of Exelon), joined the Company’s Board of Directors.
Previous report
•In April 2025, the Company announced it has signed a memorandum of understanding with Frontier Power Ltd. (“Frontier”), a UK-based energy developer, for a 5 GWh energy storage framework agreement. The agreement marks Eos’ entrance into a new international market and supports Frontier’s plans to submit multiple bids utilizing Eos’ Znyth™ battery technology in the first application window of Ofgem’s new long-duration energy storage (LDES) cap and floor scheme.
Previous report
•In May 2025, the Company announced it has secured an order with Faraday Microgrids to deploy a 3 MW / 15 MWh Eos Z3™ system for a commercial microgrid application on tribal land in California.
Previous report
•In May 2025, the Company announced an offering of 18,750,000 shares of common stock with an option, exercisable within 30 days after May 29, 2025, to purchase up to an additional 2,812,500 shares of the Company’s common stock at a price to the public of $4.00 per share, made pursuant to the Securities Act of 1933. The Underwriters exercised this option to purchase additional shares in full. The issuance and sale of 21,562,500 shares of the Company’s common stock was completed in June 2025, raising net proceeds of $81.1 million, after deducting underwriting discounts and commissions.
Previous report
•In June 2025, the Company issued an offering of $225.0 million aggregate principal amount of 6.75% convertible senior notes due 2030 in a private offering. The Company granted initial purchasers an option to purchase, for settlement within a period of thirteen days from the date the 2025 Convertible Notes were first issued, up to an additional $25.0 million principal amounts which were exercised in full.
Previous report
•In July 2025, the Company received its second loan advance from the DOE Loan Programs Office in the amount of $22.7 million under the DOE loan facility. The Company has fully drawn the maximum allowable amount under the first tranche of $90.9 million in connection with the completion of its first state-of-the-art manufacturing line.
Previous report
•In August 2025, the Company appointed industry veteran John Mahaz as Chief Operating Officer to lead the Company’s operations, supply chain and manufacturing strategy as the Company enters a critical phase of commercial scale-up.
Previous report
•In September 2025, the Company announced the launch of its new proprietary battery management system, software, controls and analytics platform, DawnOS, designed to revolutionize the way energy storage systems are managed, optimized and integrated into the grid. Fully designed, engineered, and developed in the United States, DawnOS represents a new standard in American-made battery energy storage software – with technical excellence and national security designed into the platform.
Previous report
For the three months ended September 30, 2025, Revenue increased by $29.7 million or 3,473% from $0.9 million. For the nine months ended September 30, 2025, Revenue increased by $47.9 million or 573% from $8.4 million. The increase for the three and nine months was due to higher product sales and higher selling price.
Previous report
For the three months ended September 30, 2025, Cost of goods sold increased by $38.7 million or 150% from $25.8 million. For the nine months ended September 30, 2025, Cost of goods sold increased by $77.5 million or 114% from $68.1 million. The increase for the three and nine months ended September 30, 2025 was primarily due to an increase in product sales volume, partially offset by a decrease in unit production cost.
Previous report
For the three months ended September 30, 2025, Research and development costs decreased by $0.5 million or 7% from $7.4 million. For the nine months ended September 30, 2025, Research and development costs increased by $4.1 million or 24% from $16.9 million. The decrease for the three months was driven by a reduction in materials and supplies costs. The increase for the nine months was driven by higher payroll, stock based compensation and consulting costs for key growth areas in support of scaling the business, partially offset by a reduction in materials and supplies costs.
Previous report
For the three months ended September 30, 2025, Selling, general and administrative expenses increased by $2.0 million or 11% from $17.8 million. For the nine months ended September 30, 2025, Selling, general and administrative expenses increased by $22.9 million or 53% from $43.3 million. The increase for the three and nine months was primarily driven by payroll and stock based compensation costs relating to expanded headcount in key growth areas in support of scaling the business. The increase in Selling, general and administrative expenses for the three and nine months ended September 30, 2025 includes one-time costs of $0.2 million and $3.9 million, respectively, which the Company does not expect to incur in future periods.
Previous report
Interest expense, net
Previous report
For the three months ended September 30, 2025, the Change in fair value of debt - related party decreased by $0.5 million, primarily due to the passage of time. For the nine months ended September 30, 2025, the Change in fair value of debt - related party increased by $25.4 million. The increase was primarily due to a decrease in the loan principal balance partially offset by the reduction in the contractual interest rate from 15% to 7% per annum of the Delayed Draw Term Loan.
Previous report
(Loss) gain on debt extinguishment
Previous report
For the three months ended September 30, 2025, the Company recognized a loss on debt extinguishment of $3.6 million from the modification of the non-affiliate portion of the AFG Convertible Notes. For the nine months ended September 30, 2025, the Company recognized a loss on debt extinguishment of $52.7 million from the payoff of the 2021 Convertible Notes, prepayment of the Delayed Draw Term Loan and modification of the non-affiliate portion of the AFG Convertible Notes.
Previous report
For the nine months ended September 30, 2024, the Company recognized a gain on debt extinguishment of $68.5 million from the payoff of the Senior Secured Term Loan.
Previous report
For the three months ended September 30, 2025, Other expense of $0.3 million primarily relates to costs associated with professional fees related to the amendment of the AFG Convertible Notes. For the nine months ended September 30, 2025, Other expense of $1.5 million primarily relates to costs associated with professional fees related to the Cerberus Amendments, extinguishment of the 2021 Convertible Notes, recognition of financing issuance costs from the Credit and Securities Purchase Transaction and professional fees associated with the amendment of the AFG Convertible Notes.
Previous report
Liquidity and Going Concern
Previous report
As a growth company in the early commercialization stage of its lifecycle, Eos is subject to inherent risks and uncertainties associated with the development of an enterprise. In this regard, substantially all of the Company’s efforts to date have been devoted to the development and manufacturing of battery energy storage systems and complementary products and services, recruitment of management and technical staff, deployment of capital to expand the Company’s operations to meet customer demand and raising capital to fund the Company’s development. However, as a result of these efforts, the Company has incurred significant losses and negative cash flows from operations since its inception and expects to continue to incur such losses and negative cash flows for the foreseeable future until such time that the Company can reach a scale of profitability to sustain its operations.
Previous report
In order to execute its development strategy, the Company has historically relied on outside capital through the issuance of equity, debt and borrowings under financing arrangements (collectively “outside capital”) to fund its cost structure. While the Company believes its recent entry into new credit facilities as discussed below has significantly improved its capital position and provides a path to sustainable operations and profitability, there can be no assurance the Company will be able to achieve such profitability or do so in a manner that does not require additional outside capital. Moreover, while the Company has historically been successful in raising outside capital, there can be no assurance the Company will be able to continue to obtain outside capital in the future or do so on terms that are acceptable to the Company.
Previous report
As disclosed in Note 3, Credit and Securities Purchase Transaction, on June 21, 2024, the Company entered into a financing transaction with CCM Denali Debt Holdings, LP, an affiliate of Cerberus Capital Management LP (herein after referred to as “Cerberus”, “Denali”, “Lender”, “Holder”). As a result of this transaction, Cerberus agreed to provide a $210.5 million secured multi-draw facility to be made in four installments (the “Delayed Draw Term Loan”) as well as a $105.0 million revolving credit facility (“Revolving Facility”), to be made available beginning June 21, 2026, at Cerberus’ sole discretion and only if the Delayed Draw Term Loan is fully funded. As of the date the accompanying Unaudited Condensed Consolidated Financial Statements were issued (the “issuance date”), the Delayed Draw Term Loan was fully funded. As part of the Credit and Securities Purchase Transaction, Cerberus received warrants and preferred stock resulting in a 33% ownership position in the Company as of January 24, 2025, the most recent milestone measurement date.
Previous report
As disclosed in Note 13, Borrowings, on November 26, 2024, the Company successfully closed on the DOE Loan Facility, which provides the Company with up to $303.5 million in funding, including capitalized interest, subject to the achievement of certain funding conditions. The DOE Loan Facility provides for a multi draw term loan facility under a series of at least two tranches and, if the Company elects, up to four tranches, subject to the achievement of certain conditions. Each tranche corresponds to the production, maintenance and development, and operation of a given production line to be funded using the proceeds of such tranche. The DOE Loan Facility specifies the maximum amount subject to each tranche (Tranche 1: $102.0 million; Tranche 2: $117.3 million; Tranche 3: $71.8 million; and Tranche 4: $12.3 million), and any amounts which are not withdrawn under a specified tranche cannot be allocated to another tranche. On April 16, 2025, the Company amended the DOE Loan Facility in order to clarify the maximum Tranche Commitment principal amounts by excluding capitalized interest (Tranche 1: $90.9 million; Tranche 2: $106.7 million; Tranche 3: $67.5 million; and Tranche 4: $12.3 million). The Amendment does not materially alter rights, obligations, or meaning of the DOE Loan Facility. Through September 30, 2025, the Company had drawn down $90.9 million under Tranche 1.
Previous report
As disclosed in Note 19, Shareholders’ Deficit, the Company entered into an underwriting agreement on May 29, 2025, with Jefferies LLC and J.P. Morgan Securities LLC as representatives of the several underwriters (collectively, the “Underwriters”) pursuant to which the Company agreed to sell 18,750,000 shares of the Company’s common stock at a public offering price of $4.00 per share. In addition, the Company granted the Underwriters an option, exercisable within 30 days after May 29, 2025, to purchase up to an additional 2,812,500 shares of the Company’s common stock. On May 30, 2025, the Underwriters exercised such option to purchase additional shares in full. The issuance and sale of 21,562,500 shares of the Company’s common stock was completed on June 2, 2025, raising proceeds of $81.1 million, net of fees paid to Jefferies LLC and J.P. Morgan Securities LLC.
Previous report
As disclosed in Note 13, Borrowings, on June 3, 2025, the Company issued $225 million principal amounts of Convertible Notes due 2030 (herein after referred to as the “2025 Convertible Notes”). The Company granted initial purchasers an option to purchase, for settlement within a period of thirteen days from the date the 2025 Convertible Notes were first issued, up to an additional $25 million principal amounts, which was exercised in full. The 2025 Convertible Notes accrues interest at a rate of 6.75% per annum, payable semi-annually in arrears on June 15 and December 15. The 2025 Convertible Notes will mature on June 15, 2030, subject to earlier conversion, redemption or repurchase.
Previous report
As of the issuance date, management evaluated the significance of the following negative financial conditions in accordance with Accounting Standard Codification 205-40, Going Concern:
Showing the first 40 of 47 passages. Open the source sections for the rest.
Reworded paragraphs (29)
Previous wording
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Current wording
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Previous wording
The following discussion should be read in conjunction with the accompanying Unaudited Condensed Consolidated Financial Statements for the nine months ended September 30, 2025 and 2024 and the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, including the financial statements and notes thereto.
Current wording
The following discussion should be read in conjunction with the accompanying Unaudited Condensed Consolidated Financial Statements for the three months ended March 31, 2026 and 2025 and the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, including the financial statements and notes thereto.
Previous wording
The Company offers an innovative Znyth™ technology battery energy storage system ("BESS") designed to provide the operating flexibility to manage increased grid complexity and price volatility resulting from an overall increase in renewable energy generation and a congested grid coming from an increase in electricity demand growth. The Company’s BESS utilizes a validated chemistry with accessible non-precious earth components in a durable design that is intended to deliver results in even the most extreme temperatures and conditions. The system is designed to be safe, flexible, scalable, sustainable and manufactured in the United States using raw materials primarily sourced in the United States. We believe the Company’s Z3™ battery module is the core of its innovative systems. The Z3 battery module is the only US designed and manufactured battery module that today provide utilities, independent power producers, renewables developers and C&I customers with an alternative to lithium-ion and lead-acid monopolar batteries for critical 3- to 12-hour discharge duration applications. We believe the Z3 battery will transform how utility, industrial and commercial customers store power.
Current wording
The Company offers an innovative Znyth™ technology battery energy storage system ("BESS") designed to provide the operating flexibility to manage increased grid complexity and price volatility resulting from an overall increase in renewable energy generation and a congested grid coming from an increase in electricity demand growth. The Company’s BESS is a validated chemistry with accessible non-precious earth components in a durable design that is intended to deliver results in even the most extreme temperatures and conditions. The system is designed to be safe, flexible, scalable, sustainable and manufactured in the United States, using raw materials primarily sourced in the United States. We believe the Company’s Z3 battery module is the core of its innovative systems. The Z3 battery module is the only US designed and manufactured battery module that today provide utilities, independent power producers, renewables developers and C&I customers with an alternative to lithium-ion and lead-acid monopolar batteries for critical 3- to 12-hour discharge duration applications. We believe the Z3 battery will transform how utility, industrial and commercial customers store power.
Previous wording
In addition to its BESS, the Company currently offers: (a) a Battery Management System (“BMS”) which provides a remote asset monitoring capability and service to track the performance and health of the Company’s BESS and to proactively identify future system performance issues through predictive analytics; (b) project management services to ensure the process of implementing the Company’s BESS are coordinated in conjunction with the customer’s overall project plans; (c) commissioning services that ensure the customer’s installation of the BESS meets the performance expected by the customer; and (d) long-term maintenance plans to maintain optimal operating performance of the Company’s systems.
Current wording
In addition to its BESS, the Company currently offers: (a) a BMS which provides a remote asset monitoring capability and service to track the performance and health of the Company’s BESS and to proactively identify future system performance issues through predictive analytics; (b) project management services to ensure the process of implementing the Company’s BESS are coordinated in conjunction with the customer’s overall project plans; (c) commissioning services that ensure the customer’s installation of the BESS meets the performance expected by the customer; and (d) long-term maintenance plans to maintain optimal operating performance of the Company’s systems.
Previous wording
The Company’s growth strategy contemplates increasing sales of battery energy storage systems and related software and services through a direct sales team and sales channel partners. The Company’s current and target customers include utilities, project developers, independent power producers and commercial and industrial companies.
Current wording
The Company’s growth strategy contemplates increasing sales of battery energy storage systems and related software and services through a direct sales team and sales channel partners. The Company’s current and target customers include utilities, project developers, independent power producers and C&I companies.
Previous wording
The Company continues to invest in the design, development, and production of its next-generation product, the Eos Z3 battery. This new battery builds upon the same electrochemistry that has remained largely unchanged for nearly a decade. The Eos Z3 is engineered to reduce costs and weight while enhancing manufacturability and overall system performance. Compared to the previous Gen 2.3, the Z3 features a more cost-effective design with a simplified tub structure, 50% fewer cells, and 98% fewer welds per battery module. We believe that the Eos Z3 will offer customers twice the energy density per square foot, while maintaining the same level of safety and reliability as the previous generation.
Current wording
The Company continues to invest in the design, development and production of its next‑generation product, the Eos Z3 battery. The Z3 builds upon the same underlying electrochemistry the Company has utilized for nearly a decade. The Eos Z3 is engineered to reduce cost and weight while improving manufacturability and overall system performance. Compared to the Company’s prior Gen 2.3 product, the Z3 incorporates a more cost‑effective design, including a simplified tub structure, approximately 50% fewer cells and approximately 98% fewer welds per battery module. The Company believes the Eos Z3 will provide customers with approximately twice the energy density per square foot while maintaining the safety and reliability characteristics of the previous generation.
Previous wording
The Company believes that the simplicity, flexibility, and safety of its products are key attributes desired by the market. Moreover, the Company recognizes the competitive advantage offered by the Inflation Reduction Act, which provides production tax credits (PTC) for domestically manufactured battery components, as well as tax credits for customers involved in projects meeting domestic content requirements. The Company also plans to collaborate with a consortium of community leaders, universities, and supply chain partners to pursue funding opportunities under the Bipartisan Infrastructure Law of 2021.
Current wording
The Company believes that the simplicity, flexibility and safety characteristics of its products represent important attributes valued by the market. In addition, the Company benefits from legislative incentives, including the Inflation Reduction Act and the One Big Beautiful Bill Act ("OBBBA"), which provide production tax credits (“PTC”) for domestically manufactured battery components, as well as tax credits available to customers for projects that satisfy domestic content requirements. The Company also intends to continue working with a consortium of community organizations, universities and supply chain partners to pursue available funding opportunities under the Bipartisan Infrastructure Law of 2021.
Previous wording
Cost of goods sold primarily consists of direct costs relating to labor, material and overhead directly tied to product assembly, procurement and construction (“EPC”), project delivery, commissioning and start-up test procedures. Indirect costs included in cost of goods sold are manufacturing overhead such as equipment maintenance, environmental health and safety, quality and production control procurement, transportation, logistics, depreciation and facility-related costs. As a nascent technology with a new manufacturing process that is early in its product lifecycle, the Company still faces significant costs associated with production start-up, commissioning of various components, modules and subsystems and other related costs. The Company expects its cost of goods sold to exceed revenues in the near term as it continues to scale production and prepares battery energy storage systems delivered to customers to go-live.
Current wording
Cost of goods sold primarily consists of direct costs relating to labor, material and overhead directly tied to product assembly, procurement and construction (“EPC”), project delivery, commissioning and start-up test procedures. Indirect costs included in cost of goods sold are manufacturing overhead such as equipment maintenance, environmental health and safety, quality and production control procurement, transportation, logistics, depreciation and facility-related costs. As a nascent technology with a new manufacturing process that is early in its product lifecycle, the Company still faces significant costs associated with production start-up, commissioning of various components, modules and subsystems and other related costs. For the three months ended March 31, 2026 and 2025, the Company recognized $10.3 million and $1.8 million, respectively, reduction of cost of goods sold related to the IRA PTC. The Company expects its cost of goods sold to exceed revenues in the near term as it continues to scale production and prepares battery energy storage systems delivered to customers to go-live.
Previous wording
Selling, general and administrative expenses primarily consist of payroll, personnel cost, outside professional services, facilities, depreciation, travel, marketing and public company costs.
Current wording
Selling, general and administrative expenses primarily consist of payroll and personnel-related, outside professional services, facilities, depreciation, travel, marketing and public company costs.
Previous wording
The Company incurred a loss of $0.6 million and $3.2 million from write-down of property, plant and equipment for the three months ended September 30, 2025 and 2024, respectively, and a loss of $1.4 million and $3.5 million for the nine months ended September 30, 2025 and 2024, respectively. The write-downs were mainly due to design changes from the Z3™-Phase 1 to Z3™-Phase 2 production in which the Phase 1 production assets could not be utilized or repurposed for Phase 2 production. Additionally, the loss from write-down of property, plant and equipment contains costs for disposal of miscellaneous equipment and tooling that cannot be repurposed for more automated processes.
Current wording
The Company incurred a loss of $0.1 million and $0.6 million from write-down of property, plant and equipment for the three months ended March 31, 2026 and 2025, respectively. The write-downs were mainly due to design changes from the Z3-Phase 1 to Z3-Phase 2 production in which the Phase 1 production assets could not be utilized or repurposed for Phase 2 production. Additionally, the loss from write-down of property, plant and equipment contains costs for disposal of miscellaneous equipment and tooling that cannot be repurposed for more automated processes.
Previous wording
Interest expense, net includes expenses for accrued interest, amortization of debt issuance costs and debt discounts, partially offset by capitalized interest costs on CIP assets. For the three months ended September 30, 2025, Interest expense, net increased by $4.7 million primarily due to interest expense relating to the 2025 Convertible Notes. For the nine months ended September 30, 2025, Interest expense, net decreased by $0.8 million, mainly due to lower interest expense recognized from the Senior Secured Term Loan due to the payoff of the Atlas Credit Facility in 2024, offset by interest expense relating to the 2025 Convertible Notes.
Current wording
Interest expense includes expenses for contractual interest, amortization of debt issuance costs and debt discounts, partially offset by capitalized interest costs on CIP assets and interest income.
Previous wording
See Note 13, Borrowings to our Unaudited Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report for further discussion.
Current wording
Interest expense - related party decreased $5.8 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, due to the fact that the 2021 Convertible Note Payable and the AFG Convertible Note were no longer outstanding during the three months ended March 31, 2026. See Note 11, Borrowings to our Unaudited Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report for further discussion.
Previous wording
For the three and nine months ended September 30, 2025 and 2024, the change in fair value of warrants was composed of the items below:
Current wording
For the three months ended March 31, 2026 and 2025, the change in fair value of warrants was composed of the items below:
Previous wording
The change in the fair value of embedded derivatives - related parties, was due to our convertible debt (See Note 13, Borrowings) and the change in fair value of warrants - related parties was due to changes in fair value of our SPA Warrant and contingent warrants (See Note 14, Warrants Liability).
Current wording
The Change in the fair value of derivatives - related parties, was due to the 2021 Convertible Note Payable and AFG Convertible Notes (See Note 11, Borrowings) and the Change in fair value of warrants - related parties was due to changes in fair value of our SPA Warrant and Contingent warrants (See Note 12, Warrants Liability). The change is largely driven by the Company's common stock price decrease quarter over quarter. The 2021 Convertible Note Payable and AFG Convertible Notes were not outstanding for the comparable period for the three months ended March 31, 2026.
Previous wording
For the three and nine months ended September 30, 2024, Other expense of $1.6 million and $4.7 million, respectively, primarily relates to recognition of financing issuance costs from the Credit and Securities Purchase Transaction.
Current wording
For the three months ended March 31, 2025, Other expense of $0.6 million, was primarily due to the recognition of financing issuance costs from the Credit and Securities Purchase Transaction.
Previous wording
The Company incurred income tax expense for the three and nine months ended September 30, 2025 and 2024, attributable to taxable earnings from the Company’s foreign operations which were insignificant for all periods presented.
Current wording
The Company incurred income tax expense for the three months ended March 31, 2026 and 2025, attributable to taxable earnings from the Company’s foreign operations which were insignificant for the periods presented.
Previous wording
•Since its inception, the Company has incurred significant losses and negative cash from operations in order to fund its development. During the nine months ended September 30, 2025, the Company had incurred a net loss of $849.2 million, Adjustments to reconcile net loss to cash used in operations are primarily from non-cash items on the Unaudited Condensed Consolidated Statements of Cash Flows. The non-cash items totaled $691.7 million. During the nine months ended September 30, 2025, the Company incurred negative cash flows from operations of $160.9 million and had an accumulated deficit of $2,415.4 million as of September 30, 2025.
Current wording
During the three months ended March 31, 2026, the Company incurred Net income of $508.9 million. Adjustments to reconcile the net income to cash used in operations are primarily from non-cash items on the Unaudited Condensed Consolidated Statements of Cash Flows. The non-cash items totaled $577.0 million. The Company incurred negative cash flows from operations of $119.7 million and had an accumulated deficit of $2,026.9 million as of March 31, 2026.
Previous wording
•As of September 30, 2025, the Company had $58.7 million of unrestricted cash and cash equivalents available to fund the Company’s operations and working capital of $85.4 million.
Current wording
As of March 31, 2026, the Company had $410.7 million of unrestricted cash and cash equivalents available to fund the Company’s operations, and working capital of $464.7 million on the Unaudited Condensed Consolidated Balance Sheets. Additionally, the Company had $61.7 million of restricted cash, refer to Note 4, Cash, Cash Equivalents and Restricted Cash for further discussion.
Previous wording
The Company has historically relied on outside capital to fund its cost structure and expects this reliance to continue for the foreseeable future until the Company reaches profitability through its planned revenue generating activities. During the nine months ended September 30, 2025, the Company closed on the following capital transactions:
Current wording
The Company has historically relied on outside capital to fund its cost structure and expects this reliance to continue for the foreseeable future until the Company reaches profitability through its planned revenue generating activities. During the three months ended March 31, 2026, the Company did not have any significant capital transactions.
Previous wording
•As of September 30, 2025, the Company had drawn down $90.9 million under the DOE Loan Facility, utilizing the full commitment available for Tranche 1. The initial draw of $68.3 million was made to cover eligible project costs incurred through December 6, 2024, followed by a second draw of $22.7 million for eligible project costs incurred through June 4, 2025. Tranche 1 provided funding for eligible costs in connection with the design, construction, installation, startup and shakedown of a battery automation line and related tools. In the event the Company does not achieve certain funding milestone conditions and the DOE chooses not to continue funding for the remaining tranches, the Company would need to seek alternative sources of capital, which may not be available on favorable terms or at all.
Current wording
Through March 31, 2026, under the DOE Loan Facility, the Company drew down $90.9 million for the eligible project costs that the Company had incurred through June 4, 2025. These costs represent Tranche 1 of the DOE Loan Facility for eligible costs in connection with the design, construction, installation, startup and shakedown of a battery automation line and related tools. The Company has approximately $186.6 million of availability under the DOE Loan Facility. In the event the Company does not achieve certain funding conditions and the DOE chooses not to continue funding, the Company may need to seek alternative sources of capital, which may not be available on favorable terms or at all.
Previous wording
The Company expects capital expenditures and working capital requirements to increase as it seeks to execute its growth strategy, total capital expenditures for the nine months ended September 30, 2025 and September 30, 2024 were $29.7 million and $20.1 million, respectively. See Note 7, Property, Plant and Equipment and Note 8, Intangible Assets for further discussion.
Current wording
The Company expects capital expenditures and working capital requirements to increase as it seeks to execute its growth strategy. Total capital expenditures for the three months ended March 31, 2026 and March 31, 2025 were $35.1 million and $4.9 million, respectively. See Note 6, Property, Plant and Equipment and Note 7, Intangible Assets for further discussion.
Previous wording
The Company relies heavily on private placement of convertible notes, term loans, equipment financing and issuance of common stock and warrants. Our short-term working capital needs are primarily related to funding of debt interest payments, repayment of debt principal, product manufacturing, research and development and general corporate expenses. The Company’s long-term working capital needs are primarily related to repayment of long-term debt obligations and capital expenses for capacity expansion and maintenance, equipment upgrades and repair of equipment.
Current wording
The Company relies heavily on private placement of convertible notes, term loans, equipment financing and issuance of common stock and warrants. Our short-term working capital needs are primarily related to funding of debt interest payments, product manufacturing, research and development and general corporate expenses. The Company’s long-term working capital needs are primarily related to repayment of long-term debt obligations and capital expenses for capacity expansion and maintenance, equipment upgrades and repair of equipment.
Previous wording
Net cash used in operating activities was $111.3 million for the nine months ended September 30, 2024, primarily driven by a net loss of $417.7 million, adjusted for non-cash items of $308.4 million, primarily related to stock compensation expense, depreciation and amortization, non-cash interest expense, gain on debt extinguishment, changes in fair value of debt, warrants and derivatives. The net cash outflows from changes in operating assets and liabilities was $1.9 million, primarily driven by an increase in inventory of $8.8 million and an increase in contract assets of $4.7 million, partially offset by an increase in contract liabilities of $5.4 million and an increase in interest payable - related party of $3.1 million.
Current wording
Net cash used in operating activities was $119.7 million for the three months ended March 31, 2026, adjusted for non-cash items of $577.0 million, primarily related to changes in fair value of warrants and derivatives, with offsets of stock compensation expense, depreciation and amortization, non-cash interest expense, and change in fair value of debt - related party. The net cash outflows from changes in operating assets and liabilities was $51.6 million, primarily driven by an increase in grant receivable of $10.3 million due to increased volumes of production, increase in contract assets of $25.5 million and decrease in contract liabilities of $8.5 million driven by revenue recognition and production, decrease in accounts payable of $14.8 million from payments made during the period, partially offset by an increase of accrued expenses of $7.2 million which was attributable to timing of payroll and various accruals at period end.
Previous wording
Net cash used in operating activities was $160.9 million for the nine months ended September 30, 2025, adjusted for non-cash items of $691.7 million, primarily related to stock compensation expense, loss on debt extinguishment, and changes in fair value of debt, warrants and derivatives. The net cash outflows from changes in operating assets and liabilities was $3.4 million, primarily driven by an increase in grant receivable of $10.0 million, decrease in contract liabilities of $7.2 million, increase in inventory of $6.7 million and increase in vendor deposits of $5.0 million, partially offset by increase in accounts payable of $22.2 million.
Current wording
Net cash used in operating activities of $28.9 million for the three months ended March 31, 2025, adjusted for non-cash items of $60.9 million, primarily related to changes in fair value of warrants and derivatives and partially offset by stock compensation expense relating to expanded headcount in engineering, sales, manufacturing engineering and R&D. Additionally, offsets included depreciation and amortization, non-cash interest expense and the change in fair value of debt. The net cash inflows from changes in operating assets and liabilities was $16.8 million, primarily driven by an increase in contract liabilities of $17.1 million due to customer cash receipts and increase in accounts payable of $8.1 million, partially offset by an increase in inventory of $6.1 million for future production and increased 2025 volumes, increase in accounts receivable of $4.1 million due to customer invoicing and increase in grant receivable of $1.8 million.
Previous wording
Net cash flows used in investing activities for the nine months ended September 30, 2025 was $29.7 million, primarily related to $28.8 million of payments made for purchases of property, plant and equipment for the improvement of manufacturing facilities and $0.9 million of investment made for internally developed software.
Current wording
Net cash flows used in investing activities for the three months ended March 31, 2026 were primarily composed of payments made for purchases of property, plant and equipment of $35.1 million and minor investments in internally developed software. The increase in cash flows used in investing activities are primarily to support the growth of manufacturing facilities at our Warrendale location.
Previous wording
Net cash flows used in investing activities for the nine months ended September 30, 2024 was $20.1 million for payments made for purchases of property, plant and equipment.
Current wording
Net cash flows used in investing activities for the three months ended March 31, 2025 were primarily composed of payments made for purchases of property, plant and equipment of $4.9 million.
Previous wording
Net cash provided by financing activities was $214.1 million for the nine months ended September 30, 2025, primarily due to the proceeds received from the following transactions: issuance of 2025 Convertible Notes of $240.0 million, public offering of $81.1 million, Credit and Securities Purchase Transaction of $38.5 million, DOE Loan of $22.7 million, and exercise of warrants of $14.2 million. The proceeds were partially offset by payoff of the 2021 Convertible Notes Payable and Delayed Draw Term Loan of $180.9 million, debt and equity issuance costs of $4.6 million, and payments on the equipment financing facility of $1.3 million. Proceeds from the public offering and issuance of the 2025 Convertible Notes were used to repurchase the 2021 Convertible Notes and prepay a portion of the DDTL.
Current wording
Net cash provided by financing activities was $2.7 million for the three months ended March 31, 2026, primarily due to the proceeds received from the exercise of warrants during the period of $3.3 million. The proceeds were partially offset by debt issuance costs of $0.5 million and payments on the equipment financing facility of $0.1 million.
Previous wording
Net cash provided by financing activities was $77.3 million for the nine months ended September 30, 2024, primarily due to the proceeds received from the Credit and Securities Purchase Transaction of $98.6 million and from the issuance of common stock of $14.1 million. The proceeds were partially offset by payoff of the Senior Secured Term Loan of $19.9 million, debt issuance costs - related party of $12.2 million, payments on the equipment financing facility of $2.4 million and share repurchases from employees for tax withholding of $1.1 million.
Current wording
Net cash provided by financing activities was $42.2 million for the three months ended March 31, 2025, primarily due to the proceeds received from the Credit and Securities Purchase Transaction of $38.5 million and from the exercise of warrants of $7.0 million. The proceeds were partially offset by payments on the equipment financing facility of $0.9 million and share repurchases from employees for tax withholding of $0.5 million.
Previous wording
•Future lease payments, including interest, under non-cancellable operating and financing leases of $3.2 million. The leases expire at various dates prior to 2030.
Current wording
•Future lease payments, including interest, under non-cancellable operating and financing leases of $60.2 million. The leases expire at various dates prior to 2030.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Change in fair value of derivatives