10-Q: Solid Power Advances Battery Tech, Secures $32.9M Capital

Solid Power, a solid-state battery developer, reported a 16% increase in total revenue and grant income for the nine months ended September 30, 2025, alongside a reduced operating loss and a successful $32.9 million capital raise.

Summary

• Total revenue and grant income increased by $2.4 million (16%) to $18.1 million for the nine months ended September 30, 2025, compared to $15.7 million in the prior year.
• Operating loss improved by $6.0 million (7%) to $(74.3) million for the nine months ended September 30, 2025, down from $(80.3) million in the same period last year.
• Net loss attributable to common stockholders increased slightly by $0.5 million (1%) to $(66.4) million for the nine months ended September 30, 2025, compared to $(65.9) million in the prior year.
• Cash and cash equivalents increased to $47.3 million as of September 30, 2025, from $25.4 million at December 31, 2024.
• Total liquidity (cash and available-for-sale securities) decreased by $27.0 million to $300.4 million as of September 30, 2025, from $327.5 million at December 31, 2024.
• The company entered into a Joint Evaluation Agreement with Samsung SDI Co., Ltd. and BMW AG to advance all-solid-state battery development.
• Detailed design for a continuous electrolyte production pilot line is expected to be substantially completed by the end of 2025, with commissioning on track for 2026.
• Site acceptance testing under the line installation agreement with SK On Co., Ltd. is on track for completion by the end of 2025.
• Solid Power raised net proceeds of $32.9 million through an At-the-Market (ATM) offering during the three months ended September 30, 2025, selling 8,471,849 shares at an average price of $4.02 per share.
• Approximately $115.9 million remains available for future sales under the ATM program.
• The company repurchased 3,361,396 shares of common stock for approximately $3.53 million during the nine months ended September 30, 2025, under a program with $37.3 million remaining and expiring December 31, 2025.

Sentiment

Score: 6

Explanation: The sentiment is moderately positive. While the company continues to incur losses, which is expected for an R&D stage company, it shows strong progress in strategic partnerships (Samsung SDI, BMW AG, SK On) and development milestones (pilot line, site acceptance testing). The successful capital raise through the ATM offering significantly bolsters liquidity, providing runway for continued operations. The reduction in operating loss and SG&A expenses also indicates fiscal discipline. However, the slight increase in net loss and overall decrease in total liquidity from year-end temper the enthusiasm, reflecting the inherent challenges and capital intensity of its development stage.

Positives

• Total revenue and grant income increased by 16% for the nine months ended September 30, 2025, driven by new grant income from the U.S. Department of Energy.
• Operating loss improved by 7% for the nine months ended September 30, 2025, indicating better cost management relative to revenue.
• Successful execution of an At-the-Market (ATM) offering raised $32.9 million in net proceeds, enhancing liquidity.
• Strategic partnerships are advancing, including a new Joint Evaluation Agreement with Samsung SDI Co., Ltd. and BMW AG for all-solid-state battery development.
• Progress on key development objectives, such as the detailed design for the continuous electrolyte production pilot line and site acceptance testing with SK On, remains on track.
• Selling, general and administrative expenses decreased by 10% for the nine months ended September 30, 2025, due to reduced stock-based compensation and contractor support.

Negatives

• Net loss attributable to common stockholders increased slightly by 1% for the nine months ended September 30, 2025, despite improved operating loss.
• Total liquidity decreased by $27.0 million from December 31, 2024, to September 30, 2025.
• Cash used in operating activities increased by $5.0 million for the nine months ended September 30, 2025, primarily due to decreased cash received from partners.
• Interest income decreased by $3.8 million for the nine months ended September 30, 2025, due to a reduction in available-for-sale securities.
• A $0.8 million loss was recognized from the change in fair value of warrant liabilities for the nine months ended September 30, 2025, compared to a $1.8 million gain in the prior year.
• A patent impairment loss of $748 thousand was recognized during the third quarter of 2025 for patents no longer being pursued.

Risks

• Uncertainty regarding the success of research and development efforts, including achieving technological objectives required by partners and commercializing technology ahead of competitors.
• Status as a research and development stage company with a history of financial losses and an expectation of incurring significant expenses and continuing losses for the foreseeable future.
• Non-exclusive nature of partnerships and the ability to secure and manage new business relationships.
• Ability to negotiate and execute commercial agreements with partners and customers on commercially reasonable terms.
• Dependence on broad market adoption of electric vehicles (EVs) and other technologies for the deployment of the company's technology.
• Ability to attract and retain executive officers, key employees, and other qualified personnel.
• Ability to protect and maintain intellectual property, including in jurisdictions outside of the United States.
• Ability to secure government contracts and grants, and risks related to changes in government priorities, funding reductions, or delays.
• Delays in the construction and operation of facilities for short-term research and development and long-term electrolyte production requirements.
• Risks related to information technology infrastructure and data security breaches.
• Exposure to other economic, business, or competitive factors, including supply chain interruptions and changes in market conditions.
• Potential liability for legal fees, defense costs, judgments, and/or settlement fees incurred by certain former officers and directors in a putative class action lawsuit, despite not being named as a defendant.

Future Outlook

The company expects to continue executing on its electrolyte development roadmap, with the detailed design for a continuous electrolyte production pilot line anticipated to be substantially complete by the end of 2025 and commissioning in 2026. Site acceptance testing under the SK On line installation agreement is also expected to be completed by the end of 2025, which should result in additional revenue recognition. The company anticipates an increase in direct costs corresponding to revenue growth as these projects progress. Operating expenses for the remainder of the year are expected to decrease due to cost reduction efforts. Longer term, additional liquidity may be required prior to generating adequate cash flows from electrolyte sales or licensing activities, and the company may opportunistically seek further equity or debt financing.

Management Comments

• We remained fiscally disciplined, balancing financial discipline with appropriate investments in technology developments and process improvements.
• We also raised net proceeds of $32.9 million through sales of our shares of common stock under an at-the-market offering program.

Industry Context

Solid Power operates in the rapidly evolving solid-state battery and electric vehicle (EV) market, which is characterized by emerging technologies, competitive pricing, and changing consumer demands. The company's focus on sulfide-based solid electrolyte material positions it within a segment aiming for significant improvements in energy density, battery life, and safety over traditional lithium-ion batteries. Strategic partnerships with automotive OEMs like BMW AG and battery manufacturers like Samsung SDI and SK On are crucial for validating and commercializing its technology, reflecting a broader industry trend of collaboration to accelerate advanced battery development. Government funding, such as the DOE assistance agreement, also highlights the strategic importance placed on domestic battery technology development.

Legal Proceedings

• A putative class action lawsuit (Hamilton et al. v. Anderson et al., C.A. No. 2024-1241-JTL) was filed on December 3, 2024, against former officers and directors of Decarbonization Plus Acquisition Corporation III (DCRC) alleging breach of fiduciary duties and unjust enrichment related to the merger. The company, its subsidiaries, or current officers/directors (except Mr. Anderson) are not named as defendants.
• The Hamilton Defendants have demanded indemnification and advancement of defense costs from the company, making it reasonably possible that the company could be liable for legal fees, defense costs, judgments, and/or settlement fees. The company cannot currently estimate a reasonably possible loss.

Related Party Transactions

• The company has a joint development agreement (JDA) with BMW of North America LLC, which was further amended in 2024 to extend the term, revise payment schedules, and update deliverables. The company recognized $0 revenue related to the JDA and $171,000 from cell material sales to BMW for the nine months ended September 30, 2025.
• Transactions with Dahae Energy Co., Ltd., a strategic partner, include a bond with detachable warrants, restricted stock grants to two Dahae executives, and a term loan facility. The company incurred $10,204,000 in costs related to services provided by Dahae for the nine months ended September 30, 2025.
• The company holds a 20% equity interest in Dahae, accounted for using the equity method.
• Restricted stock grants to Dahae executives (298,508 shares) are contingently redeemable at fair value and recorded within Mezzanine Equity. As of September 30, 2025, 87,319 shares vested.
• A term loan facility with Dahae has a principal balance of $1,161,000, an explicit interest rate of 3%, and matures on October 21, 2034. The company has committed to provide up to $2,000,000 of additional financing to Dahae.

Stakeholder Impact

• **Shareholders**: The ATM offering and potential future capital raises could dilute existing shareholders, but also provide necessary funding for continued development. The stock repurchase program aims to return value to shareholders, though its impact is limited by the remaining authorization. Continued losses impact shareholder equity.
• **Employees**: Research and development expenses, largely employee compensation, remain a significant investment, indicating continued employment for a skilled workforce. Stock-based compensation is a key component of employee incentives.
• **Customers/Partners (BMW, Samsung SDI, SK On)**: The Joint Evaluation Agreement and ongoing site acceptance testing with key partners demonstrate continued collaboration and progress towards commercialization, which is positive for future product availability and technology adoption.
• **Creditors**: The company's liquidity position, bolstered by the ATM offering, provides confidence in its ability to meet short-term obligations. The loan receivable from Dahae represents an asset, but also a risk exposure.
• **Regulatory Authorities**: Compliance with SEC filing requirements and adherence to accounting standards are maintained, as evidenced by the certifications.

Next Steps

• Substantially complete the detailed design for the continuous electrolyte production pilot line by the end of 2025.
• Commission the continuous electrolyte production pilot line in 2026.
• Complete site acceptance testing under the line installation agreement with SK On Co., Ltd. by the end of 2025.
• Continue to execute on project milestones for the continuous electrolyte production pilot line to recognize additional grant income.
• Monitor and potentially utilize the remaining $115.9 million available under the At-the-Market (ATM) offering for working capital and general corporate purposes.
• Consider seeking additional equity or debt financing longer term if current resources are insufficient or if favorable terms become available.
• Continue to manage and reduce operating expenses through cost reduction efforts.

Key Dates

Recommendation

Solid Power is an R&D stage company operating in a high-growth, high-risk sector. While the company reported a slight increase in net loss, the improvement in operating loss and the successful capital raise through the ATM offering are positive indicators of financial management and continued investment in its core technology. Strategic partnerships with major industry players like BMW AG, Samsung SDI, and SK On validate the potential of its solid-state battery technology and provide a clear path towards commercialization. However, significant risks remain, including the inherent uncertainties of R&D, the need for future capital, and the competitive landscape. Given the progress on key milestones and strengthened liquidity, but also the ongoing losses and long development cycle, a 'hold' recommendation is appropriate for investors who are already positioned and believe in the long-term potential of solid-state batteries, while new investors should approach with caution due to the speculative nature of the investment.

Keywords

Solid-state battery, EV battery technology, Sulfide-based electrolyte, Battery electric vehicle, SEC filing, Quarterly report, Research and development, SK On, Samsung SDI, BMW AG, DOE grant, Capital raise, Stock repurchase, Financial results