Fourth Quarter Fiscal 2024 Summary
(All comparisons are year-over-year unless otherwise noted)

Revenue of $49.3 million, compared to $22.5 million
Gross loss of $(10.9) million compared to $(1.5) million
Loss from operations of $(41.0) million compared with $(36.4) million
Net loss per share was $(2.21) compared with $(2.07)

Fiscal Year 2024 Summary
(All comparisons are year-over-year unless otherwise noted)

Revenue of $112.1 million, compared to $123.4 million
Gross loss of $(35.9) million compared to $(10.5) million
Loss from operations of $(158.5) million compared with $(136.1) million
Net loss per share was $(7.83) compared with $(7.92)

“In the fourth quarter, our revenue more than doubled, year over year, mainly driven by module sales to Gyeonggi Green Energy Co., Ltd. in South Korea,” said Jason Few, President and Chief Executive Officer. “Looking ahead, we believe that global demand for energy remains strong in markets around the world, driven by data centers, AI, cryptocurrency growth, the need for more resilient and reliable grids, and carbon recovery and capture.”

“In 2025, we expect that our business will be on stronger financial footing as a result of our previously announced global restructuring that will focus our core technologies on distributed power generation, grid resiliency, and data center growth,” added Mr. Few. “Our go-forward strategy will enable us to better navigate the current market and emphasizes topline revenue growth and future profitability. We remain encouraged by our platforms’ ability to address critical needs, including power shortages in grids, high voltage transmission needs, and delays in centralized power projects due to lengthy permitting processes. In the short to medium term, we don’t see a better answer than clean baseload distributed power generation from a fuel cell."

Consolidated Financial Metrics
	Three Months Ended October 31,								Twelve Months Ended October 31,
(Dollars in thousands, except per share amounts)		2024			2023		Change			2024			2023		Change
Total revenues	$	49,326		$	22,462		120	%	$	112,132		$	123,394		(9	%)
Gross loss		(10,917	)		(1,464	)	N/A			(35,918	)		(10,535	)	N/A
Loss from operations		(41,032	)		(36,376	)	(13	%)		(158,488	)		(136,084	)	(16	%)
Net loss		(39,600	)		(29,458	)	(34	%)		(156,778	)		(108,056	)	(45	%)
Net loss attributable to common stockholders		(42,216	)		(31,164	)	(35	%)		(129,209	)		(110,768	)	(17	%)
Net loss per basic and diluted share⁽¹⁾		(2.21	)		(2.07	)	(7	%)		(7.83	)		(7.92	)	1	%

EBITDA*		(32,250	)		(29,660	)	(9	%)		(122,317	)		(110,709	)	(10	%)
Adjusted EBITDA*	$	(25,343	)	$	(30,830	)	18	%	$	(101,111	)	$	(102,882	)	2	%

(1) All per share figures have been retroactively adjusted to reflect the Company’s reverse stock split that became effective on November 8, 2024.

* A reconciliation of non-GAAP measures EBITDA and Adjusted EBITDA is contained in the appendix to this press release.

Fourth Quarter of Fiscal 2024 Results

(All comparisons are between fourth quarter of fiscal 2024 and fourth quarter of fiscal 2023 unless otherwise noted)

Fourth quarter revenue of $49.3 million represents an increase of 120% from the comparable prior year quarter.

Product revenues increased to $25.4 million during the three months ended October 31, 2024, compared to $10.5 million during the three months ended October 31, 2023. Product revenue for the three months ended October 31, 2024 was primarily driven by $18.0 million of revenue recognized under the Company’s long-term service agreement (the “GGE Agreement”) with Gyeonggi Green Energy Co., Ltd. (“GGE”) for the replacement of the first six fuel cell modules for GGE’s 58.8 MW fuel cell power plant platform in Hwasong-si, Korea. The increase also reflects $7.7 million of revenue recognized under the Company’s sales contract with Ameresco, Inc., which was entered into during the second quarter of fiscal year 2024, pursuant to which the Company is to provide a 2.8 MW platform to the Sacramento Sewer District. Product revenues for the prior year quarter reflect the recognition of revenue related to a performance guarantee, which was part of the December 2021 Settlement Agreement with POSCO Energy Co., Ltd. and its subsidiary, Korea Fuel Cell Co., Ltd. (“KFC”). Recognition of this revenue was constrained until certain of the modules previously sold by the Company to KFC were installed at the Noeul Green Energy, Co. Ltd. (“Noeul Green Energy”) site and the Company entered into a long-term service agreement to service those installed modules for Noeul Green Energy.
Service agreements revenues increased to $5.6 million from $(0.8) million. The increase in service agreements revenues during the three months ended October 31, 2024 was primarily driven by two module exchanges during the quarter. There were no module exchanges during the fourth quarter of fiscal 2023. Revenue for the fourth quarter of fiscal 2023 was impacted by higher future cost estimates related to future module exchanges compared to the Company’s prior estimates, which more than offset revenue recognized for that quarter. Service agreements revenue can be variable from period to period depending on the number of module exchanges during the period and changes to future cost estimates used to recognize revenue in the period.
Generation revenues increased 40.3% to $12.0 million from $8.5 million, primarily driven by revenue related to the Toyota and Derby projects, which began operations in the first quarter of fiscal 2024.
Advanced Technologies contract revenues increased to $6.4 million from $4.3 million. Advanced Technologies contract revenues recognized under the purchase order received from Esso Nederland B.V., an affiliate of ExxonMobil Technology and Engineering Company (“EMTEC”), related to the Rotterdam project were approximately $2.3 million higher and revenue recognized under government contracts and other contracts were approximately $0.6 million higher for the three months ended October 31, 2024 compared to the three months ended October 31, 2023. These higher revenue amounts were partially offset by lower revenue recognized of $0.8 million under the Joint Development Agreement with EMTEC during the three months ended October 31, 2024.

Gross loss for the fourth quarter of fiscal 2024 totaled $(10.9) million, compared to a gross loss of $(1.5) million in the comparable prior year quarter. The increase in gross loss for the fourth quarter of fiscal 2024 was primarily related to (i) the fact that there were costs associated with the increased product revenues recognized in the fourth quarter of fiscal year 2024, while there was no cost of goods sold associated with the product revenues of $10.5 million recognized in the fourth quarter of fiscal 2023, and (ii) higher generation cost of sales during the fourth quarter of fiscal 2024 as the Company recorded a derivative loss of $1.8 million, as compared to a derivative gain of $4.1 million in the fourth quarter of fiscal 2023 as a result of net settling certain natural gas purchases under the previous normal purchase normal sale contract designation. These items were partially offset by benefits from improved service profitability as a result of module exchanges in the fourth quarter of fiscal 2024, while there were no module exchanges during the fourth quarter of fiscal 2023.

Operating expenses for the fourth quarter of fiscal 2024 decreased to $30.1 million from $34.9 million in the fourth quarter of fiscal 2023. Administrative and selling expenses decreased to $15.9 million during the fourth quarter of fiscal 2024 from $16.9 million during the fourth quarter of fiscal 2023. The decrease in administrative and selling expenses is primarily a result of the fact that the comparable prior year quarter included closing costs relating to a tax equity financing, which impact was partially offset by higher compensation expense in the fourth quarter of fiscal 2024. Research and development expenses decreased to $11.6 million during the fourth quarter of fiscal 2024 compared to $18.0 million in the fourth quarter of fiscal 2023. The decrease in research and development expenses reflects the previously announced decrease in spending on the Company’s ongoing commercial development efforts related to our solid oxide platforms and carbon separation and carbon recovery solutions compared to the comparable prior year quarter, as well as the allocation of resources to funded Advanced Technology projects.

Net loss was $(39.6) million in the fourth quarter of fiscal 2024, compared to net loss of $(29.5) million in the fourth quarter of fiscal 2023.

Adjusted EBITDA totaled $(25.3) million in the fourth quarter of fiscal 2024, compared to Adjusted EBITDA of $(30.8) million in the fourth quarter of fiscal 2023. Please see the discussion of non-GAAP financial measures, including Adjusted EBITDA, in the appendix at the end of this release.

The net loss per share attributable to common stockholders in the fourth quarter of fiscal 2024 was $(2.21), compared to $(2.07) in the fourth quarter of fiscal 2023. The net loss per common share in the fourth quarter of fiscal 2024 was a result of the higher net loss offset by the benefit of the higher number of weighted average shares outstanding due to share issuances since October 31, 2023.

Restructuring and Operational Update

In November, we announced a global restructuring of our operations in the U.S., Canada, and Germany that aims to significantly reduce operating costs, realign resources toward advancing the Company’s core technologies, and protect the Company’s competitive position amid slower-than-expected investments in clean energy. We believe that the restructuring plan will allow us to prioritize commercially available technologies to reflect changing market opportunities with an updated strategic plan. In connection with this restructuring plan, we expect to reduce operating costs by approximately 15% in fiscal year 2025, compared with fiscal year 2024. The restructuring plan included a reduction in our workforce of approximately 13% or 75 employees in November 2024 and includes reduced spending for product development, overhead and other costs. This followed a 4% or 17 employee reduction in our workforce in September 2024.

In fiscal year 2022, we provided aspirational long-term revenue targets to be met by the end of fiscal year 2025 and fiscal year 2030. In developing these revenue targets, we made certain timing assumptions regarding, among other things, the development, commercialization and market adoption timelines of our solid oxide electrolysis cell (“SOEC”), solid oxide fuel cell (“SOFC”) and carbon capture products. However, these long-term revenue targets do not reflect the current market realities regarding the pace of hydrogen adoption and infrastructure build out as well as continuing uncertainty regarding the Inflation Reduction Act and other large scale clean energy policies globally. In addition, as part of our restructuring plan, we reduced headcount and have begun to reduce spending on product development. As a result of current market realities, and in conjunction with our restructuring plan, the timing of the development and commercialization of our SOEC, SOFC and carbon capture products has been delayed from our prior estimates and, accordingly, due to these factors, we will not meet the aspirational revenue targets that we provided in fiscal year 2022. However, because we believe we have good visibility into contracted revenue drivers for fiscal year 2025, including with respect to revenues expected to be recognized upon delivery of replacement modules to GGE, we expect to see a material improvement in the Company’s revenues for fiscal year 2025 compared to fiscal year 2024.

Cash, Restricted Cash and Short-Term Investments

Cash and cash equivalents, restricted cash and cash equivalents, and short-term investments totaled $318.0 million as of October 31, 2024, compared to $403.3 million as of October 31, 2023. Of the $318.0 million total as of October 31, 2024, unrestricted cash and cash equivalents totaled $148.1 million, short-term investments totaled $109.1 million and restricted cash and cash equivalents totaled $60.8 million. Of the $403.3 million total as of October 31, 2023, unrestricted cash and cash equivalents totaled $250.0 million, short-term investments totaled $103.8 million, and restricted cash and cash equivalents totaled $49.6 million. Short-term investments represent the amortized cost of U.S. Treasury Securities outstanding and held by the Company as of October 31, 2024 and October 31, 2023 as part of the Company’s cash management optimization effort.

“We were pleased to add the Export-Import Bank of the United States to the list of financing organizations with whom we have created relationships,” said Michael Bishop, Executive Vice President, Chief Financial Officer and Treasurer. “We continue to see growth opportunities around the world that benefit from access to supportive capital. Lastly, I am encouraged by the strength of our balance sheet, which includes over $300 million in cash and short-term investments.”

During the three months ended October 31, 2024, approximately 1.9 million shares of the Company’s common stock were sold under the Company’s Amended Open Market Sale Agreement at an average sale price of $11.23 per share, resulting in gross proceeds of approximately $21.5 million before deducting sales commissions and fees, and net proceeds to the Company of approximately $20.8 million after deducting sales commissions and fees totaling approximately $0.6 million.

Backlog

	As of October 31,
(Amounts in thousands)		2024		2023	Change
Product	$	111,283	$	0	$	111,283
Service		174,174		140,782		33,392
Generation		841,377		872,072		(30,695	)
Advanced Technologies		35,999		15,263		20,736
Total Backlog	$	1,162,833	$	1,028,117	$	134,716

As of October 31, 2024, backlog increased by approximately 13.1% to $1.16 billion, compared to $1.03 billion as of October 31, 2023, primarily as a result of the GGE Agreement entered into during the third quarter of fiscal year 2024. Backlog for the GGE Agreement has been allocated between product backlog and service backlog. Product backlog will be recognized as revenue as the Company completes commissioning of the replacement modules. Under the GGE Agreement, commissioning of the first six 1.4-MW replacement fuel cell modules was completed in the fourth quarter of fiscal year 2024. An additional 30 1.4-MW replacement fuel cell modules are expected to be commissioned throughout the course of calendar year 2025, and the remaining six 1.4-MW replacement fuel cell modules are expected to be commissioned in the first half of calendar year 2026. Service backlog will be recognized as revenue as the Company performs service at the GGE site over the term of the GGE Agreement.

Backlog represents definitive agreements executed by the Company and our customers. Projects for which we have an executed power purchase agreement (“PPA”) or hydrogen power purchase agreement (“HPPA”) are included in generation backlog, which represents future revenue under long-term PPAs and HPPAs. The Company’s ability to recognize revenue in the future under a PPA or HPPA is subject to the Company’s completion of construction of the project covered by such PPA or HPPA. Should the Company not complete the construction of the project covered by a PPA or HPPA, it will forgo future revenues with respect to the project and may incur penalties and/or impairment charges related to the project. Projects sold to customers (and not retained by the Company) are included in product sales and service agreements backlog, and the related generation backlog is removed upon sale. Together, the service and generation portion of backlog had a weighted average term of approximately 16 years as of October 31, 2024, with weighting based on the dollar amount of backlog and utility service contracts of up to 20 years in duration at inception.

Conference Call Information

FuelCell Energy will host a conference call today beginning at 10:00 a.m. ET to discuss fourth quarter and full fiscal year 2024 results as well as key business highlights. Participants can access the live call via webcast on the Company’s website or by telephone as follows:

The live webcast of the call and supporting slide presentation will be available at www.fuelcellenergy.com. To listen to the call, select “Investors” on the home page located under the “Our Company” pull-down menu, proceed to the “Events & Presentations” page and then click on the “Webcast” link listed under the December 19^th earnings call event, or click here.
Alternatively, participants can dial 888-330-3181 and state FuelCell Energy or the conference ID number 1099808.

INEOS is Committed to Investment in Hydrogen Technology as a Core Part of its Future Business