FuelCell Energy (FCEL) Q3 2024 earnings summary

Executive summary

• Revenue for Q3 FY24 was $23.7 million, down 7% year-over-year, with a net loss widening to $35.1 million from $23.6 million, though the prior year included a $15.3 million one-time gain; gross loss narrowed to $6.2 million from $8.2 million.

• Backlog increased 13% year-over-year to $1.2 billion, driven by a major long-term service agreement with Gyeonggi Green Energy in Korea.

• Advanced key projects in carbon capture, hydrogen production, and bio-generation, including progress with ExxonMobil, Ameresco, and Rotterdam carbon capture.

• Maintained disciplined expense and capital management, including a 4% workforce reduction in September 2024 and spending adjustments.

• Maintained strong liquidity, with cash, restricted cash, and short-term investments totaling $326 million as of July 31, 2024.

Financial highlights

• Q3 FY24 revenue was $23.7 million, down from $25.5 million in Q3 FY23; nine-month revenue was $62.8 million, down from $100.9 million.

• Net loss for the quarter was $35.1 million ($0.07/share), compared to $23.6 million ($0.06/share) in the prior year; nine-month net loss was $87.0 million ($0.19/share).

• Adjusted EBITDA improved to -$20.1 million from -$31.6 million year-over-year.

• Gross loss narrowed to $6.2 million from $8.2 million in the prior year.

• Operating expenses decreased to $27.4 million from $33.2 million year-over-year.

Outlook and guidance

• Product backlog from the GGE agreement will be recognized as modules are commissioned through 2026.

• Service backlog recognized over the term of the GGE agreement.

• FY24 capital expenditures targeted at $45M–$60M; R&D at $56M–$61M; project asset investments at $12M–$15M.

• Management expects liquidity to be sufficient for at least the next 12 months.

• Additional workforce and spending reductions may occur in response to market developments.