Fuel Tech (FTEK) Q3 2025 earnings summary

Executive summary

• Achieved profitable operations in Q3 2025, with net income of $303,000 ($0.01 per share), up from $80,000 in the prior year, driven by strong margins in both FUEL CHEM and APC segments.

• Expanded client base and customer relationships in both APC and FUEL CHEM segments, with FUEL CHEM benefiting from new accounts and increased dispatch.

• Completed a strategic acquisition of Wahlco, Inc.'s APC intellectual property and customer assets for $350,000, expected to strengthen global APC offerings.

• Maintained a strong financial position with $33.8 million in cash and investments and no long-term debt.

• Gross margin improved to 49% in Q3 2025 from 43% a year ago, with FUEL CHEM at 50% and APC at 47%.

Financial highlights

• Q3 2025 consolidated revenues declined to $7.5 million from $7.9 million year-over-year, mainly due to lower APC segment revenues, partially offset by higher FUEL CHEM revenues.

• FUEL CHEM revenue increased to $4.8 million from $4.6 million; APC revenue declined to $2.7 million from $3.2 million.

• Consolidated gross margin rose to 49% from 43% year-over-year; FUEL CHEM gross margin at 50%, APC at 47%.

• Adjusted EBITDA was $228,000, compared to a loss of $35,000 in Q3 2024.

• Cash and investments totaled $33.8 million at quarter end; net cash from operations was $4.6 million for the nine months ended September 30, compared to a $1.8 million use in the prior year.

Outlook and guidance

• 2025 revenues expected to be approximately $27 million, an 8% increase over 2024, excluding material contributions from new APC data center contracts or new FUEL CHEM business development.

• FUEL CHEM full-year 2025 segment revenue now guided to $16.5–$17 million, up from prior guidance of $15–$16 million.

• APC business pursuing $3–$5 million in additional contracts expected to close by year-end or early Q1 2026, with a separate $80–$100 million pipeline for data center-related SCR projects.

• Ongoing demonstration of DGI technology at a fish hatchery expected to last until Q2 2026.

• Cash balance expected to remain flat to slightly down by year-end 2025.