20-F: Eco Wave Power Reports Increased Losses Amid Project Advancements

Eco Wave Power Global AB (publ) reported a significant increase in net loss for 2025, despite advancing key wave energy projects in the U.S., Taiwan, and India, while facing delays in Portugal.

Summary

• Net loss increased by 77% to $3.72 million in 2025, up from $2.11 million in 2024.
• Revenue decreased by 77% to $38 thousand in 2025, primarily from a feasibility study in South Africa, compared to $168 thousand in 2024 from a Taiwan wave energy project.
• Operating loss widened by 34% to $3.13 million in 2025, from $2.34 million in 2024, driven by increased operating expenses.
• Cash, cash equivalents, and short-term bank deposits stood at $6.3 million as of December 31, 2025, down from $9.45 million in 2024.
• Cash used in operating activities increased to $3.04 million in 2025 from $1.82 million in 2024.
• The first U.S. wave energy pilot project was successfully launched at the Port of Los Angeles on September 9, 2025, in collaboration with AltaSea and Shell Marine Renewable Energy.
• The Jaffa Port (EDF EWP One) project successfully connected to the Israeli national electrical grid in August 2023 and continues to serve as an R&D site.
• The planned 1MW project in Portugal faces delays due to localized damage to the Barra do Douro breakwater from a strong storm in March 2026, requiring structural assessment and repairs by the Port Authority (APDL).
• A land use tender was awarded for a wave energy pilot station in Taiwan in August 2025, with a land lease agreement signed in December 2025.
• A non-binding Memorandum of Understanding was signed with Bharat Petroleum Corporation Limited (BPCL) in February 2025 to develop wave energy projects in India, starting with a feasibility study and a 100 KW pilot project.
• The company is exploring opportunities in the AI and data infrastructure sector and developing AI-enabled software tools like WaveGPT for operational optimization and predictive maintenance.
• Total worldwide project pipeline is estimated at over 404.7 megawatts, though most are subject to preliminary agreements.

Sentiment

Score: 4

Explanation: StockSavvy.ai views this as a challenging financial period, marked by significantly increased losses and reduced revenue. While operational progress in project development and strategic initiatives in AI are positive, the financial deterioration and the delay in the key Portugal project temper overall sentiment.

Positives

• Successfully launched the first U.S. wave energy pilot project at the Port of Los Angeles on September 9, 2025, demonstrating technological deployment in a key market.
• Secured a manufacturing agreement with All-Ways Metal, Inc. and an installation agreement with C&S Welding Inc. for the Port of Los Angeles project, indicating progress in supply chain and deployment.
• The Jaffa Port (EDF EWP One) project has been successfully connected to the Israeli national electrical grid since August 2023, providing a live R&D site and validating grid integration.
• Received final approval (TURH license) for the commencement of construction works for the first MW-scale project in Porto, Portugal, in March 2024, and paid the first installment of the grid connection fee in May 2025.
• Awarded official land use tender for a wave energy pilot station in Taiwan in August 2025, marking a significant precedent for wave power testing in Taiwan.
• Signed a non-binding MOU with Bharat Petroleum Corporation Limited (BPCL) in India for joint wave energy project development, including a 100 KW pilot, expanding market reach.
• Actively developing AI-enabled software tools (WaveGPT) for enhanced operational performance, monitoring, and predictive maintenance, aligning with technological advancements.
• Exploring opportunities to position wave energy technology as a renewable power source for the rapidly growing AI and data infrastructure sector.
• The company's WEC technology is highlighted as more cost-efficient, reliable, insurable, and environmentally friendly compared to offshore systems, with a significantly lower forecasted capital expenditure per megawatt (EUR 1.2M-1.8M vs. offshore $5.18M-$15.61M).
• Internal calculations suggest a competitive Levelized Cost of Energy (LCOE) as low as EUR 42 ($44) per megawatt hour in commercial scales, comparable to utility-scale solar PV and better than offshore wind.

Negatives

• Net loss increased significantly by 77% to $3.72 million in 2025 from $2.11 million in 2024.
• Revenue decreased by 77% to $38 thousand in 2025 from $168 thousand in 2024, indicating a substantial decline in income from services.
• Operating loss widened by 34% to $3.13 million in 2025, reflecting increased operational expenses without corresponding revenue growth.
• Cash, cash equivalents, and short-term bank deposits decreased to $6.3 million as of December 31, 2025, from $9.45 million in 2024, indicating a reduction in liquidity.
• Cash used in operating activities increased by $1.2 million to $3.04 million in 2025, highlighting increased cash burn from operations.
• The Portugal project, a key MW-scale initiative, experienced localized damage to its breakwater from a storm in March 2026, which is expected to affect the previously anticipated execution timeline.
• The company has a history of operating losses and an accumulated deficit of $18.76 million as of December 31, 2025, with no assurance of achieving or maintaining profitability.
• The shift from net financial income of $230 thousand in 2024 to a net financial expense of $592 thousand in 2025, primarily due to unfavorable foreign exchange rate differences, negatively impacted the bottom line.
• The company is in the process of dissolving certain subsidiaries in Mexico, Gibraltar, Australia, and China that do not hold operational projects or material assets, indicating a reduction in global footprint or previous project failures.

Risks

• The company has a history of operating losses and may never achieve or maintain profitability.
• Substantial additional funding is required for commercialization, which may not be available on acceptable terms or at all, potentially leading to curtailment or discontinuation of product development.
• Revenues and profitability may be impacted by the need to pay royalties on government grants and other agreements, which may also include penalties for default.
• Reduction or elimination of government subsidies, grants, and other economic incentives for renewable energy could adversely affect operations and financial condition.
• Uncertainty regarding patent protection for technology, as patent applications may not result in issued patents or may be challenged, hindering effective competition.
• Inability to enforce intellectual property rights globally due to prohibitive costs and weaker intellectual property laws in some foreign countries.
• Risk of third parties alleging infringement of their intellectual property rights, leading to costly litigation, licensing requirements, or cessation of operations.
• Claims challenging the inventorship of patents and other intellectual property could result in loss of valuable rights and substantial costs.
• Restrictions on jointly developed intellectual property with partners may affect future product development and commercialization plans.
• Liability for environmental harm and failure to comply with environmental laws could severely damage the business and reputation.
• Difficulty in obtaining necessary regulatory approvals and permits in various jurisdictions, which could limit or delay business expansion.
• Changes in environmental laws and regulations, or fundamental changes in government agency operations, could reduce demand or impact the timing for services.
• National electricity markets are politically regulated and complex, with potential for changing regulations to force cessation of operations or exit from markets.
• Unsuccessful compliance with applicable privacy regulations (e.g., GDPR) could have an adverse effect on business and reputation.
• Potential future regulation as an electric public utility could significantly increase operating costs and restrict business operations.
• Risks associated with severe storms, natural disasters, and the physical effects of climate change on seas and oceans, potentially leading to significant losses and repair costs.
• Dependence on a small number of employees and key consultants; loss of senior management could adversely affect business execution.
• Indemnification provisions in contracts could lead to adverse effects if obligations exceed insurance coverage or third parties fail to indemnify.
• Difficulties in managing future growth, including expanding managerial, operational, sales, marketing, financial, and legal personnel, could disrupt operations.
• Anticipated growth in demand for renewable energy may not occur, reducing the market opportunity for products.
• Sales efforts targeted at larger public sector customers may result in longer, more expensive sales cycles, pricing pressure, and implementation challenges.
• Wave energy is relatively new and unproven at commercial scale, meaning the technology may never be successfully commercialized.
• Intense competition in the renewable energy business from competitors with substantially greater resources and/or more cost-effective technology.
• Changes in technology, including advances in other renewable energy sources, could render products less attractive or obsolete.
• Inability to successfully negotiate and enter into service contracts with customers and partners on acceptable terms could impair revenue diversification.
• WEC technology can only be deployed in certain geographic locations, limiting business growth if sufficient sites are not secured.
• Volatility in pricing for renewable energy may impact financial condition and profitability.
• Failure by third parties to supply or manufacture components or deploy systems timely or properly could adversely affect business.
• Dependence on collaborative partners, whose efforts may not align with the company's best interests or who may pursue alternative technologies.
• Operating under letters of intent and other non-definitive agreements could lead to uncertainty, disputes, or projects not being realized.
• Research and development expenses are expected to increase, and delays or insufficient investment could materially affect the business.
• No guarantee of commercializing WEC technology even with definitive agreements, as conditions and licenses are required for construction.
• Limited operating history of WEC technology means performance over estimated useful life is unconfirmed, risking product failures and substantial repair costs.
• Product and services liability suits, whether meritorious or not, could result in expensive litigation, substantial damages, and increased insurance rates.
• Accident and safety risks inherent in operating products in water, with existing insurance policies potentially insufficient to cover all claims.
• The employment agreement with the Chief Executive Officer includes a $2.0 million cash bonus upon a change of control, which may discourage, delay, or prevent such a change.
• Rights of shareholders under Swedish law may differ from those typically offered to shareholders of a U.S. corporation, potentially offering less protection.
• Claims of U.S. civil liabilities may not be enforceable against the company due to its incorporation in Sweden and headquarters in Israel.
• Political, economic, and military instability in Israel or the Middle East (e.g., Israel-Hamas-Hezbollah war, Israel-Iran war, credit rating downgrades, employee military service, boycotts) may adversely affect business.
• Failure to satisfy conditions of government grants could result in loss of funding or repayment obligations, impairing strategic transactions.
• Exchange rate fluctuations between the U.S. dollar and SEK, or NIS and U.S. dollar, may negatively affect financial results.
• The market price of ADSs may be highly volatile due to factors beyond the company's control, including technological innovations, regulatory changes, and economic conditions.
• Executive officers, directors, and principal shareholders (owning approximately 49.86% of share capital) have the ability to exert significant control over matters submitted to shareholders for approval.
• The company may be classified as a Passive Foreign Investment Company (PFIC) for U.S. tax purposes, leading to adverse tax consequences for U.S. shareholders.
• No dividends are expected in the foreseeable future, meaning investment success depends on share value appreciation.
• ADS holders must act through the depositary to exercise shareholder rights, potentially leading to delays or inability to vote.
• ADS holders may not be entitled to a jury trial with respect to claims arising under the deposit agreement.
• As a foreign private issuer, the company follows certain home country corporate governance practices, which may result in less protection than for U.S. domestic issuers.
• As an emerging growth company, reduced disclosure requirements may make ADSs less attractive to investors.
• Cybersecurity breaches of systems and information technology could adversely impact operations.
• Involvement in litigation matters or other legal proceedings could be expensive, time-consuming, and divert management attention.
• Requirements associated with being a public company demand significant resources and management attention.
• Identified a material weakness in internal control over financial reporting (insufficient finance staff) which has not been remedied, potentially affecting financial reporting accuracy and investor confidence.
• Future sales of ADSs by the company or security holders could reduce the market price and dilute existing shareholders.

Future Outlook

The company expects to require substantial additional capital in future periods to commercialize its products and services, with existing cash and equivalents projected to fund operations for at least the next 12 months. Future funding requirements depend on R&D efforts, commercialization costs, ability to generate cash flows, economic conditions, and regulatory approvals. The company aims to fund R&D through grants and cost-sharing, and to achieve commercial-scale projects (20MW+) through debt financing, potentially with additional equity. It plans to continuously improve WEC technology, complete WPV software development, optimize technology for various wave heights and climates, and develop advanced AI-based software tools like WaveGPT. The company is prioritizing growth in Europe and the United States and expanding its project pipeline with turnkey projects to accelerate cash flow and market penetration.

Management Comments

• Under Inna Braverman's leadership, the Company installed its first grid-connected wave energy array, secured a significant projects pipeline of more than 404.7MW, and became the first Israeli company to ever list on Nasdaq Stockholm.
• We believe that our WEC technology has the potential to accelerate the viability of wave power in a way that was previously not achievable because our WEC technology is more cost-efficient, reliable, insurable and environmentally friendly and easier connected to the grid compared to offshore systems.
• We believe this will be the first wave energy project in the world to show significant energy production from wave power (referring to the Portugal project).
• We aspire to build wave energy power stations using our WEC technology that will give people access to electricity generated from a source in proximity to their residence without creating air pollution and while mitigating environmental damage.
• We believe that our core WEC technology is the basis to our future success, and as such, we aim to continuously improve and enhance our WEC technology in order to deliver the best solution available in the field for wave energy generation.
• We believe that the increase in solar and wind energy cannot singlehandedly solve the world's energy consumption needs because these types of energies are unlikely to have the capacity to completely replace fossil fuels.
• We believe that the addition of these two services (feasibility studies and WPV software), and potentially others, will help position us as not only as a technology provider, but also as a world-leader in a proprietary software for the growth of the wave energy industry.
• We believe that the rapid expansion of AI and data center infrastructure may create additional demand for renewable electricity generation.

Industry Context

StockSavvy.ai notes that the global energy market is experiencing significant growth, with global energy consumption projected to rise by 50% between 2018 and 2050, driven by non-OECD countries, particularly in Asia. Renewable energy investments reached $807 billion in 2024, a 22% increase from 2022/2023, with global renewable power capacity expected to more than double by 2030. Solar and wind power dominate new capacity additions, benefiting from falling Levelized Cost of Energy (LCOE). However, marine energy, especially wave energy, remains largely unexploited despite having the highest energy production rate (90% of the time) and significant theoretical potential (29,500 TWh/year globally, 2,640 TWh/year in the U.S.). The company's focus on nearshore/onshore WEC technology addresses challenges faced by offshore systems, such as high capital and operational costs, low reliability, and insurability issues. The increasing global electricity demand from AI and high-performance computing infrastructure, projected to more than double data center consumption by 2030, presents a new strategic opportunity for renewable energy solutions like wave power, especially given the proximity of coastal populations to potential wave energy sites.

Comparison to Industry Standards

• The company's forecasted capital expenditure for its WEC technology on a commercial scale (20 MW and above) is EUR 1.2 million ($1.3 million) to EUR 1.8 million ($1.9 million) per megawatt, which is significantly lower than the $5.18 million (EUR 4.96 million) to $15.61 million (EUR 14.5 million) per megawatt for offshore wave energy competition, as reported by the World Energy Council.
• The company's internally calculated Levelized Cost of Energy (LCOE) for commercial scales is as low as EUR 42 ($44) per megawatt hour. This is competitive with utility-scale solar photovoltaics ($0.044 per kilowatt hour in 2023) and lower than offshore wind ($0.075 per kilowatt hour in 2023), according to IRENA data.
• The company's nearshore/onshore WEC technology is positioned to address the reliability and cost challenges that have hindered the commercialization of many offshore WEC systems, which struggled with harsh marine environments, high installation/maintenance costs, and insurability issues.
• The company's claim of 90% energy production time for wave energy, as cited from 'Advances and Challenges in Ocean Wave Energy Harvesting,' positions it favorably against intermittent renewable sources like solar and wind, which only produce energy when the sun is shining or the wind blows.

Management Changes

Corporate Governance

Legal Proceedings

• Not currently subject to any material legal proceedings.

Related Party Transactions

• Employment agreements with executive officers, including a $2.0 million cash bonus for the CEO upon a change of control.
• Loans from David Leb (shareholder and board member) totaling $1.042 million as of December 31, 2025, including a $200,000 loan (principal paid, accrued interest remains) and an $800,000 interest-bearing loan (4% annual interest, payable upon demand, repayment dependent on company's financial condition).

Stakeholder Impact

• Shareholders: Face increased net losses and cash burn, potential for future dilution from capital raises, and volatility in ADS price. The delay in the Portugal project could impact future revenue expectations. Principal shareholders maintain significant control.
• Employees: The company's growth strategy and R&D efforts could create opportunities, but the small team size and reliance on key personnel, especially in Israel, expose them to operational risks including military service obligations.
• Customers: Potential for access to cost-efficient and environmentally friendly wave energy technology, but also risks associated with the unproven commercial scale of wave energy and potential project delays.
• Creditors: Loans from related parties are significant, and the ability to repay depends on the company's financial condition. Creditor rights under Swedish insolvency law may be less robust than under U.S. law.
• Partners (e.g., Shell, AltaSea, BPCL, I-KE, EDF Renewables): Collaboration agreements are crucial for project development and market penetration, but reliance on partners introduces execution risks and potential restrictions on jointly developed IP.
• Regulatory Bodies: The company's operations are subject to various international and local regulations, permits, and grants, requiring continuous compliance and potentially impacting project timelines and costs.

Next Steps

• Continue to develop projects in the pipeline and expand the project pipeline.
• Work towards implementing the megawatt project in Portugal and/or other locations.
• Conduct research and development to upgrade and improve WEC technology.
• Reinforce the patent portfolio.
• Expand the team to achieve growth strategy.
• Complete the development of WPV software for real-time production verification.
• Optimize WEC technology to generate larger amounts of electricity in all wave heights.
• Optimize WEC technology materials for different weather/marine climates and cost-effective implementation.
• Develop advanced data analytics and AI-based software tools, including WaveGPT.
• Monitor the U.S. pilot project in the Port of Los Angeles to serve as an educational and showcase platform.
• Move more projects from the pipeline stage into the ready-to-build stage.
• Move forward with new projects in Taiwan and India, serving as first turnkey projects.
• Add more pilot turnkey projects to the pipeline as a means of penetration to new markets.
• Finalize licensing and construction of the first megawatt of the Portugal power station.
• Pursue additional financing (debt or equity) upon successful execution of the first one-megawatt scale project to construct and operate multiple revenue-yielding assets.

Key Dates

Recommendation

Eco Wave Power operates in a high-potential, yet nascent, renewable energy sector. While the significant increase in net loss and decline in revenue for 2025 are concerning, indicating ongoing cash burn and a challenging path to profitability, the company has made tangible progress on key projects in the U.S., Taiwan, and India. The strategic focus on AI integration and turnkey projects could enhance future efficiency and market penetration. However, the recent delay in the Portugal project due to storm damage highlights the inherent risks in wave energy deployment. Given the blend of substantial financial risks, operational advancements, and long-term industry potential, a 'hold' recommendation is appropriate. Investors should monitor the company's ability to secure additional financing, manage project execution, and demonstrate commercial viability of its technology, especially in light of the Portugal setback and the unremediated material weakness in internal controls.

Keywords

Wave Energy, Renewable Energy, WEC Technology, Clean Electricity, AI Infrastructure, Data Centers, Energy Transition, Sustainable Energy, SEC Filing, Form 20-F, Eco Wave Power, Nasdaq, Sweden, Israel, Portugal Project, Los Angeles Pilot, Taiwan Project, India Project, Warrants, Financial Results, Operating Losses, Capital Requirements, Intellectual Property, Government Grants, Corporate Governance, Risk Factors