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The following information should be read in conjunction with the unaudited financial information and the notes thereto included in this Quarterly Report on Form 10-Q and the audited financial information and the notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2024, filed with the U.S.
−Removed: Securities and Exchange Commission (SEC) on March 7, 2024, which we refer to as the Annual Report.
+Added: Securities and Exchange Commission (SEC) on February 27, 2025, which we refer to as the Annual Report.
Certain matters discussed in this Quarterly Report on Form 10-Q may be deemed to be forward-looking statements that involve risks and uncertainties.
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In addition, even if our results of operations, financial condition and liquidity, and the development of the industry in which we operate are consistent with the forward-looking statements contained in this Quarterly Report on Form 10-Q, they may not be predictive of results or developments in future periods.
−Removed: The following information and any forward-looking statements should be considered in light of factors discussed elsewhere in this Quarterly Report on Form 10-Q and under “Risk Factors” in Item 1A of the Annual Report.
+Added: The following information and any forward-looking statements should be considered in light of factors discussed elsewhere in this Quarterly Report on Form 10-Q, including Part I Item 1 “Financial Statements,” which includes our financial statements and related notes, and under the sections titled “Risk Factors” in Item 1A of the Annual Report and this Quarterly Report on Form 10-Q.
We caution readers not to place undue reliance on any forward-looking statements made by us, which speak only as of the date they are made.
We disclaim any obligation, except as specifically required by law and the rules of the SEC, to publicly update or revise any such statements to reflect any change in our expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.
−Removed: You should read the following discussion and analysis of financial condition and results of operations together with Part I Item 1 “Financial Statements,” which includes our financial statements and related notes, elsewhere in this Quarterly Report on Form 10-Q.
Investors and others should note that we routinely use the Investors section of our website to announce material information to investors and the marketplace.
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Our core businesses are organized into two reportable segments:
−Removed: Energy Industrial and Thermal Barrier.
+Added: Thermal Barrier and Energy Industrial.
The following describes our key product offerings and new product innovations by reportable segment.
Thermal Barrier
−Removed: We are actively developing a number of promising aerogel products and technologies for the electric vehicle (EV) market.
+Added: We are actively developing a number of promising aerogel products and technologies for the EV market.
We have developed and are commercializing our proprietary line of PyroThin aerogel thermal barriers for use in battery packs in EVs.
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Our thermal barrier technology is designed to offer a unique combination of thermal management, mechanical performance and fire protection properties.
−Removed: These properties enable EV manufacturers to achieve critical battery performance and safety goals.
+Added: These properties enable EV manufacturers to achieve critical battery performance and safety goals by impeding the propagation of thermal runaway in lithium-ion battery systems at the battery cell, module and pack levels across multiple lithium-ion battery system architectures.
+Added: Our ultra-thin, lightweight and flexible thermal barriers are designed to allow battery manufacturers to achieve critical safety goals without sacrificing energy density.
In addition, we are seeking to leverage our patented carbon aerogel technology to develop industry-leading battery materials for use in lithium-ion battery cells.
−Removed: These battery materials have the potential to increase the energy density of the battery cells, thus enabling an increase in the driving range of EVs.
+Added: Our carbon aerogel initiative seeks to increase the performance of lithium-ion battery cells to enable EV manufacturers to reduce charging time and the cost of EVs.
The commercial potential for our PyroThin thermal barriers and our carbon aerogel battery materials in the EV market is significant.
−Removed: Accordingly, we are hiring additional personnel, incurring additional operating expenses, incurring significant capital expenditures to expand aerogel manufacturing capacity, establishing an automated thermal barrier fabrication operation, enhancing research and development resources and expanding our battery material research facilities, among other items.
−Removed: We have entered into production contracts with certain major OEMs, including General Motors LLC (GM), to supply fabricated, multi-part thermal barriers for use in the battery system of its next-generation EVs.
−Removed: Pursuant to the contracts with GM, we are obligated to supply the barriers at fixed annual prices and at volumes to be specified by the customer up to a daily maximum quantity through the term of the agreements, which expire at various times from 2026 through 2034.
−Removed: While GM has agreed to purchase its requirement for the barriers from us at locations to be designated from time to time, it has no obligation to purchase any minimum quantity of barriers under the contracts.
−Removed: In addition, GM may terminate the contracts any time and for any or no reason.
−Removed: All other terms of the contracts are generally consistent with GM’s standard purchase terms, including quality and warranty provisions customary in the automotive industry.
−Removed: We have also entered into production contracts with Toyota, Scania, Audi, a luxury brand of the Volkswagen Group, ACC, a battery cell joint venture between Stellantis N.V, Saft-TotalEnergies and Mercedes-Benz, and a large EU battery manufacturer to supply a next generation vehicle platform of a major EU luxury sports car brand.
+Added: We have entered into multi-year production contracts with a number of automotive EV OEM customers to supply fabricated, multi-part thermal barriers for use in the battery systems of their EV models.
+Added: These customers include General Motors LLC (GM),
+Added: Toyota, Scania, Automotive Cells Company, which is a battery cell joint venture between Stellantis N.V, Saft-TotalEnergies and Mercedes-Benz, Audi, a luxury brand of the Volkswagen Group, Volvo Truck, and a large EU battery manufacturer to supply a next generation vehicle platform of a major EU luxury sports car brand.
+Added: We are currently supplying thermal barrier production parts to both General Motors and Toyota, and thermal barrier prototype parts to a number of global manufacturers of EVs, grid storage and home battery systems.
+Added: During fiscal years 2024, 2023 and 2022, we sold $306.8 million, $110.1 million and $55.6 million, respectively, of our PyroThin thermal barriers.
Energy Industrial
−Removed: We also design, develop and manufacture innovative, high-performance aerogel insulation used primarily in the energy industrial and sustainable insulation materials markets.
+Added: We also design, develop and manufacture innovative, high-performance aerogel insulation used primarily in the energy industrial market.
We believe our aerogel blankets deliver the best thermal performance of any widely used insulation product available on the market today and provide a combination of performance attributes unmatched by traditional insulation materials.
+Added: Our insulation products help end-users to improve resource efficiency, reduce energy consumption, and reduce the carbon footprint of their operations.
+Added: These products enable compact system design, reduce installation time and costs, promote freight and logistics cost savings, reduce system weight, minimize required storage space and enhance job site safety.
+Added: Our insulation products reduce the incidence of corrosion under insulation, which is a significant maintenance cost and safety issue in energy industrial facilities.
Our end-user customers select our products where thermal performance is critical and to save money, improve resource efficiency, enhance sustainability, preserve operating assets and protect workers.
−Removed: Our insulation is used by oil producers and the owners and operators of refineries, petrochemical plants, LNG facilities, power generating assets and other energy industrial companies.
+Added: Our insulation is used by oil producers and the owners and operators of refineries, petrochemical plants, liquefied natural gas (LNG) facilities, power generating assets and other energy industrial sites.
Our Pyrogel ® and Cryogel ® product lines have undergone rigorous technical validation by industry leading end-users and achieved significant market adoption.
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We have operated the East Providence facility since 2008 and have increased our capacity in phases.
−Removed: To meet expected growth in demand for our aerogel products in the EV market, we have been in the process of expanding our aerogel blanket capacity by constructing a second manufacturing plant in Bulloch County, Georgia.
−Removed: However, in order to manage the development of the second plant so that its increased capacity comes online in a manner that aligns with our current expectations as to demand from our EV customers, we are extending the timeframe for construction and commissioning of the second plant until such time as its capacity is supported by increased demand.
−Removed: In the meantime, and until we ramp up construction, we believe that productivity improvements in our existing Rhode Island facility combined with our supplemental supply of our energy industrial products from an external manufacturing facility in China will permit us to achieve our target revenue capacity in 2024 and prior to the completion and start-up of the second plant.
−Removed: At present, we have engaged one third-party external manufacturing facility in China to produce certain of our Energy Industrial products.
−Removed: Pursuant to our supply contract with this contract manufacturer, they are obligated to deliver products to us as we issue purchase orders on an as-needed basis through the term of the agreement.
+Added: During 2024, we converted our East Providence facility to support the growth of the thermal barrier program.
+Added: To meet expected demand for our aerogel products, we plan to make additional productivity improvements in our existing East Providence facility and utilize a flexible supply strategy, including but not limited to use of our external manufacturing capabilities in China, which currently support our Energy Industrial segment and are capable of delivering increased aerogel production capacity.
+Added: We expect that the productivity improvements in our existing East Providence facility as well as the supply from our external manufacturing facility will permit us to achieve our target revenue capacity in 2025.
+Added: Pursuant to our supply contract with this contract manufacturer, they are obligated to deliver products to us as we issue purchase orders on an as-needed basis through the term of the contract.
The contract automatically renews year-to-year unless either party notifies the other of its intention not to renew the contract.
While we have agreed to purchase our requirement for certain Energy Industrial products from the contract manufacturer, we have no obligation to purchase any minimum quantity under the contract and we may terminate the contract at any time and for any or no reason.
−Removed: Additionally, we have entered into a contract with Prodensa Servicios de Consultora (Prodensa) to establish OPE Manufacturer Mexico S de RL de CV, a maquiladora located in Mexico, (OPE) which manufactures thermal barrier PyroThin products and operates an automated fabrication facility for PyroThin.
+Added: Additionally, we have entered into a contract with Prodensa to establish OPE Manufacturer Mexico S de RL de CV, which assembles thermal barrier PyroThin products and operates an automated fabrication facility for PyroThin.
Pursuant to such contract, we pay Prodensa a management fee and have an option to purchase OPE from Prodensa after a period of 18 months.
−Removed: Recent Developments
−Removed: Underwritten Offering
−Removed: In October 2024, we entered into an underwriting agreement (the Underwriting Agreement) with Goldman Sachs & Co.
−Removed: LLC and Morgan Stanley & Co.
−Removed: LLC (collectively, the Underwriters), pursuant to which we issued and sold an aggregate of 4,887,500 shares of our common stock, which included 637,500 shares pursuant to the Underwriters’ option to purchase additional shares of our common stock, to the Underwriters in a registered underwritten offering (the “Offering”).
−Removed: The price to the public in the Offering was $20.00 per share.
−Removed: The net proceeds to us from the Offering were approximately $93.2 million, after deducting underwriting discounts and commissions and estimated offering expenses payable by us.
−Removed: Department of Energy Loan Programs Office
−Removed: On October 16, 2024, we announced that the U.S.
−Removed: Department of Energy (DOE) Loan Programs Office provided us a conditional commitment for a proposed loan of up to $670.6 million (the Loan) under the Advanced Technology Vehicles Manufacturing (ATVM) loan program within DOE’s Loan Programs Office (LPO) for financing the construction of our planned second aerogel manufacturing facility (the Statesboro Plant) in Statesboro, Georgia.
−Removed: Aspen Aerogels Georgia, LLC, a subsidiary of Aspen Aerogels, Inc, is the intended borrower of the Loan.
−Removed: The Loan would be structured as project financing, providing for repayment commencing upon project commissioning.
−Removed: The interest rate will be the applicable U.S.
−Removed: Treasury Rate at the time of each cash draw.
−Removed: While this conditional commitment indicates the DOE’s intent to finance the project, the DOE and the Company must satisfy certain technical, legal, environmental, and financial conditions before the DOE enters into definitive financing documents and funds the loan.
−Removed: We had previously estimated the cost of the Statesboro Plant to be approximately $710.0 million.
−Removed: Adjusting the estimated cost to account for the right-timing of construction, inflation, and a revised scope that reflects recent process improvements, we have revised our aggregate cost estimate to a range of approximately $800.0 million to $960.0 million.
−Removed: The prospective DOE loan is intended to fully fund our remaining spend on the construction of the plant, following and assuming the expected closing of the Loan.
−Removed: The receipt by us of the conditional commitment from the DOE in respect of the Loan is not an assurance that definitive financing documents will be negotiated and entered into, that the terms and conditions of the Loan will be consistent with the terms contemplated in the conditional commitment, or that all technical, legal, environmental and financial conditions will be achieved and satisfied.
−Removed: The outcome of the process with the DOE relating to the Loan and the Company's ability to draw and utilize such funds towards the construction of the Statesboro Plant is dependent on whether the DOE determines to proceed with the definitive financing documents and under what conditions.
−Removed: There can be no assurance as to the outcome of these decisions and the terms and conditions of the financing documents that may be offered, if any.
−Removed: See the section titled “Risk Factors—Risks Related to Our Business and Strategy—We are dependent upon our ability to close on and fully draw down on our proposed loan facility from the United States Department of Energy, which may restrict our ability to conduct our business.”
−Removed: MidCap Loan Facility
−Removed: On August 19, 2024, we and Aspen Aerogels Rhode Island, LLC, a Rhode Island limited liability company (Aspen RI and, together with the Company, each, a Borrower and collectively, the “Borrowers”) entered into a Credit, Security and Guaranty Agreement (the Credit Agreement and the facilities provided thereunder, collectively, the MidCap Loan Facility), by and among the Borrowers, MidCap Funding IV Trust, as agent (the Agent), MidCap Financial Trust, as term loan servicer, the financial institutions or other entities from time to time party thereto as lenders (the Lenders), and the other parties party thereto as additional guarantors and/or borrowers from time to time.
−Removed: The proceeds of the MidCap Loan Facility were used in connection with the transaction contemplated by the Note Repurchase Agreement (as defined below), the payment of related fees and expenses and for working capital of the Company and its subsidiaries.
−Removed: Loans borrowed under the MidCap Loan Facility mature on August 19, 2029.
−Removed: The MidCap Loan Facility is comprised of (i) a term loan facility in an aggregate principal amount of $125.0 million (the Term Loan Facility) and (ii) an asset-based revolving credit facility in an aggregate principal amount not to exceed the lesser of (A) a $100.0 million commitment amount and (B) the value of the borrowing base (defined as the sum of (x) 85% of certain eligible accounts of the Borrowers and (y) the lesser of 85% of the NOLV or 85% of the cost of certain eligible inventory of the Borrowers) (the Revolving Facility).
−Removed: Loans borrowed under the Term Loan Facility will bear an interest rate equal to Term SOFR (as defined in the Credit Agreement) for a one-month interest period plus 4.50% per year, subject to a Term SOFR floor of 4.50% and a Term SOFR cap of 7.50%.
−Removed: Loans borrowed under the Revolving Facility will bear an interest rate equal to Term SOFR plus 4.60% per year, subject to a Term SOFR floor of 2.50%.
−Removed: The Term Loan Facility is subject to amortization of principal, payable quarterly on the last day of each quarter, commencing September 30, 2024, in an amount as set forth in the Credit Agreement with the remaining aggregate principal amount payable on the maturity date.
−Removed: The Revolving Facility has a required minimum balance set at 30% of the average borrowing
−Removed: base during the immediate preceding month.
−Removed: The Borrowers are required to pay the Lenders under the Revolving Facility an unused line fee of 0.30% of the average unused availability under the Revolving Facility, subject to the aforementioned minimum balance.
−Removed: Repurchase of Convertible Note
−Removed: On August 19, 2024, we entered into a note purchase and sale agreement (the Note Repurchase Agreement) with Wood River Capital, LLC (Wood River), an entity affiliated with Koch Disruptive Technologies, LLC, pursuant to which we repurchased from Wood River $123.9 million in aggregate capitalized principal amount (inclusive of PIK interest paid through June 30, 2024) of Convertible Senior PIK Toggle Notes due 2027, dated February 18, 2022, as amended by Amendment No.
−Removed: 1 to Convertible Senior PIK Toggle Notes due 2027, dated November 28, 2022 (the Convertible Note), such aggregate amount being the entire outstanding amount of the Convertible Note, for a total purchase price of $150.1 million in cash, which amount equals to the Redemption Price (as defined in the Convertible Note).
−Removed: Pursuant to the Note Repurchase Agreement, all rights and obligations, covenants and agreements under the Convertible Note and the underlying note purchase agreement were satisfied and discharged.
+Added: As of March 31, 2025, we have notified Prodensa of our intent to purchase OPE.
+Added: We expect to meet our long-term Thermal Barrier program demand by maximizing capacity at our East Providence facility and utilizing a flexible supply strategy, including, but not limited to, using our external manufacturing capabilities, which currently support our Energy Industrial segment and are capable of delivering increased aerogel production capacity.
+Added: Accordingly, we have ceased construction at the previously planned Statesboro Plant.
+Added: We will be demobilizing the plant and are in the process of assessing options
+Added: to derive value from the assets, including potentially relocating certain equipment to improve and expand our existing manufacturing facility in East Providence.
Financial Summary
−Removed: Our revenue for the nine months ended September 30, 2024 was $329.6 million, which represented an increase of $175.1 million, or 113%, from $154.5 million for the nine months ended September 30, 2023.
−Removed: Net income for the nine months ended September 30, 2024 was $2.0 million and net loss per share was $0.03.
−Removed: Net loss for the nine months ended September 30, 2023 was $45.3 million and net loss per share was $0.65.
+Added: Our revenue for the three months ended March 31, 2025 was $78.7 million, which represented a decrease of $15.8 million, or 17%, from $94.5 million for the three months ended March 31, 2024.
+Added: Net loss for the three months ended March 31, 2025 was $301.2 million and net loss per share was $3.67.
+Added: Net loss for the three months ended March 31, 2024 was $1.8 million and net loss per share was $0.02.
Key Metrics and Non-GAAP Financial Measures
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We define Adjusted EBITDA as net income (loss) before interest expense, taxes, depreciation, amortization, stock-based compensation expense and other items, from time to time, which we do not believe are indicative of our core operating performance.
−Removed: Adjusted EBITDA is a supplemental measure of our performance that is not presented in accordance with accounting principles generally accepted in the United States of America (U.S.
+Added: Adjusted EBITDA is a supplemental measure of our performance that is not presented in accordance with U.S.
Adjusted EBITDA should not be considered as an alternative to net income (loss) or any other measure of financial performance calculated and presented in accordance with U.S.
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Three Months Ended
−Removed: Nine Months Ended
−Removed: September 30,
−Removed: September 30,
(In thousands)
−Removed: Net income (loss)
Depreciation and amortization
Stock-based compensation (1)
−Removed: Other expense (income)
−Removed: Loss on extinguishment of debt
+Added: Other expense
Income tax expense
+Added: Restructuring and demobilization costs
+Added: Impairment of property, plant and equipment
Adjusted EBITDA
−Removed: (1) Represents non-cash stock-based compensation related to vesting and modifications of stock option grants, vesting of restricted stock units and vesting of restricted common stock.
+Added: (1) Represents non-cash stock-based compensation related to vesting and modifications of stock option grants, vesting of restricted stock units and vesting of restricted common stock, and cash settled stock-based compensation settled.
Our financial performance, including such measures as net income (loss), earnings per share and Adjusted EBITDA, are affected by a number of factors including volume and mix of aerogel products sold, average selling prices, our material costs and manufacturing expenses, the costs associated with capacity expansions and start-up of additional production capacity, and the amount and timing of operating expenses.
Accordingly, we expect that our net income (loss), earnings per share and Adjusted EBITDA will vary from period to period.
−Removed: We expect to maintain strong revenue growth during 2024 driven by accelerating demand in the EV market and continued market share gains in the sustainable insulation materials market.
−Removed: Our expectation to maintain strong revenue growth is based, in part, on our OEM customers’ production volume forecasts and targets as well as our expectation to successfully scale our manufacturing capabilities and address any potential supply chain issues to meet this expected demand.
−Removed: As a result, we expect to experience a decrease in both net loss and negative Adjusted EBITDA during 2024, compared to 2023.
+Added: Our expectation for thermal barrier revenue is based, in part, on our OEM customers’ production volume forecasts and targets.
+Added: Our OEM customers operate in a cyclical industry that is sensitive to shifting consumer trends, political and regulatory uncertainty and economic conditions in the markets they operate.
+Added: EV adoption rates in some of our customers’ markets are expected to be at a slower rate than originally expected and EV investment continues to be re-timed as demand expectations in North America and Europe are reset.
+Added: However, some of our OEM customers have been gaining market share from a low base volume and expect to continue to gain market share in 2025.
+Added: Furthermore, changes in government and economic policies, incentives, and tariffs may impact our customers and our production, sales, cost structure and the competitive landscape.
+Added: Additionally, our OEM customers continue to innovate which could result in engineering changes to the parts we supply primarily to reduce costs for our OEMs.
+Added: Cost-cutting initiatives adopted by our customers may result in increased downward pressure on pricing.
+Added: Our customer supply agreements generally require step-downs in component pricing over the periods of production and OEMs have historically possessed significant leverage over their outside suppliers.
+Added: Accordingly, we expect thermal barrier revenues to decline in 2025.
+Added: However, we are expecting an increase in energy industrial revenues.
+Added: We are projecting growth in energy industrial revenue due to expected volume growth in our core petrochemical and refinery markets, an anticipated increase in project-based demand and continued penetration of new markets.
+Added: We will continue to adjust to these developments, and we believe our ongoing cost reduction, including by reducing headcount, and improved production innovation and efficiency, will continue to benefit us.
+Added: As a result, we expect to experience a decline in net income and Adjusted EBITDA during 2025.
+Added: We also expect to incur reduced capital expenditures during 2025.
Components of Our Results of Operations
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We record deferred revenue for sales when (i) we have delivered products, but other revenue recognition criteria have not been satisfied, or (ii) payments have been received in advance of the completion of required performance obligations.
−Removed: We project revenue growth during 2024 due to accelerating demand in the EV market and continued market share gains in the sustainable insulation materials market.
Cost of Revenue
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In addition, global supply chain disturbances, increased reliance on foreign materials procurement, industrial gas supply constraints, increases in the cost of our raw materials, engineering changes, higher prototype sales and other factors may significantly impact our material costs and have a material impact on our operations.
−Removed: We expect that material costs will increase in absolute dollars during 2024 due to projected growth in product shipments and contracts but remain stable as a percentage of revenue due to improved manufacturing, and fabrication yields and a favorable mix of products sold.
Manufacturing expense is also a significant component of cost of revenue.
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Manufacturing expense also includes stock-based compensation of manufacturing employees and shipping costs.
−Removed: We expect that manufacturing expense will increase in absolute dollars and decrease as a percentage of revenue during 2024 due to increased staffing costs and spending levels in support of our thermal barrier business, including the operation of an automated fabrication facility in Monterrey, Mexico.
−Removed: We are also continuing to monitor the impact on our material costs, manufacturing expense, and cost of product revenue from engaging one or more external manufacturing facilities in China to supply our aerogel products for the energy industrial market beginning in 2024.
−Removed: We expect that our energy industrial product material costs will increase in absolute dollars and as a percentage of revenue, and manufacturing expense and cost of revenue will decrease as a percentage of revenue due to projected volume growth, which will be manufactured through the external manufacturing facility.
−Removed: During 2024, we expect that cost of product revenue will increase in absolute dollars due to projected volume growth and a planned increase in staffing and spending levels, but decrease as a percentage of product revenue due to projected increases in average selling prices, improved manufacturing and fabrication yields and a favorable mix of products sold.
+Added: We are also continuing to monitor the impact on our material costs, manufacturing expense, and cost of product revenue from engaging one or more external manufacturing facilities in China to supply our aerogel products, which began in 2024.
Our gross profit as a percentage of revenue is affected by a number of factors, including the volume of products produced and sold, the mix of products sold, average selling prices, our material and manufacturing costs, realized capacity utilization and the costs associated with expansions and start-up of production capacity.
Accordingly, we expect our gross profit to vary significantly in absolute dollars and as a percentage of revenue from period to period.
−Removed: During 2024, we expect gross profit to increase in both absolute dollars and as a percentage of total revenue due to the combination of a projected increase in total revenue combined with projected reduction in material costs and manufacturing expense as a percentage of total revenue.
−Removed: In the longer term, we expect gross profit to improve in absolute dollars and as a percentage of revenue due to expected increases in total revenue, production volumes and manufacturing productivity.
−Removed: In addition, we expect the gross profit improvement derived from the increases in revenue, volume and productivity will be supported by the continued implementation of lower cost product formulations and realization of material purchasing efficiencies.
Operating Expenses
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Operating expenses include personnel costs, legal fees, professional fees, service fees, insurance premiums, travel expense, facilities related costs and other costs, expenses and fees.
−Removed: The largest component of our operating expenses is personnel costs, consisting of
−Removed: salaries, benefits, incentive compensation and stock-based compensation.
+Added: The largest component of our operating expenses is personnel costs, consisting of salaries, benefits, incentive compensation and stock-based compensation.
In any particular period, the timing and extent of personnel additions or reductions, legal activities, including patent enforcement actions, marketing programs, research efforts and a range of similar activities or actions could materially affect our operating expenses, both in absolute dollars and as a percentage of revenue.
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We also expect to continue to invest in research and engineering personnel and the infrastructure required in support of their efforts.
−Removed: We expect our research and development expenses will increase in absolute dollars and decrease as a percentage of revenue in 2024 and the longer term.
Sales and Marketing Expenses
Sales and marketing expenses consist primarily of personnel costs, incentive compensation, marketing programs, costs of new product and process introductions, travel and related costs, consulting expenses and facilities related costs.
−Removed: We expect our sales and marketing expenses will increase in absolute dollars but decrease as a percentage of revenue in 2024 and in the longer term.
General and Administrative Expenses
General and administrative expenses consist primarily of personnel costs, legal expenses, consulting and professional services, audit fees, compliance with securities, corporate governance and related laws and regulations, investor relations and insurance premiums, including director and officer insurance.
−Removed: We expect our general and administrative expenses to increase as we add general and administrative personnel to support the anticipated growth of our business.
−Removed: We also expect that the patent enforcement actions, described in more detail under “Legal Proceedings” in Part I, Item 3 of our Annual Report and “Legal Proceedings” in Part II, Item 1 of this Quarterly Report on Form 10-Q, if protracted, could result in significant legal expense over the medium to long-term.
−Removed: We expect that our general and administrative expenses will increase in absolute dollars and decrease as a percentage of revenue.
+Added: We expect that the patent enforcement actions, described in more detail under “Legal Proceedings” in Part I, Item 3 of our Annual Report and “Legal Proceedings” in Part II, Item 1 of this Quarterly Report on Form 10-Q, if protracted, could result in significant legal expense over the medium to long-term.
+Added: Restructuring and demobilization costs
+Added: Restructuring and demobilization costs consists of severance and other personnel costs, facility closures and other costs associated with the demobilization of our previously planned Statesboro Plant.
+Added: Impairment of property, plant and equipment
+Added: In 2025, impairment of property, plant and equipment consists of impairment incurred on our previously planned Statesboro Plant.
+Added: During the fiscal year ended December 31, 2024, the impairment of equipment under development was the result of a charge for impairment of assets due to obsolescence following development of new and more efficient equipment.
Interest Expense, Convertible Note - Related Party
−Removed: Interest expense, convertible note - related party is net of the capitalized interest related to the $100.0 million in aggregate principal amount of our Convertible Senior PIK Toggle Notes due 2027, which we sold and issued to Wood River.
+Added: Interest expense, convertible note - related party is net of the capitalized interest related to the 2022 Convertible Note which we sold and issued to Wood River.
+Added: The Company repurchased the 2022 Convertible Note on August 19, 2024.
Interest Income (Expense)
1 unchanged sentence
Provision for Income Taxes
−Removed: We have incurred annual net losses since inception and have not recorded benefit provisions for U.S.
−Removed: federal income taxes or state income taxes since the tax benefits of our net losses have been offset by valuation allowances due to the uncertainty associated with the utilization of net operating loss carryforwards.
−Removed: We record tax expenses in connection with our Mexican maquiladora operations.
+Added: We have incurred net losses since inception with the exception of the year ended December 31, 2024, and have not recorded benefit provisions for U.S.
+Added: federal income taxes since the tax benefits of our net losses have been offset by valuation allowances due to the uncertainty associated with the utilization of net operating loss carryforwards.
+Added: We record tax expenses in connection with provisions for state income taxes and our Mexican maquiladora operations.
Results of Operations
−Removed: Three months ended September 30, 2024 compared to the three months ended September 30, 2023
+Added: Three months ended March 31, 2025 compared to the three months ended March 31, 2024
The following tables set forth a comparison of the components of our results of operations for the periods presented:
−Removed: Three Months Ended September 30,
+Added: Three Months Ended March 31,
($ in thousands)
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Total revenue
−Removed: Total revenue increased $56.5 million, or 93%, to $117.3 million for the three months ended September 30, 2024 from $60.8 million in the comparable period in 2023.
−Removed: The increase in total revenue was the result of an increase in thermal barrier revenue, offset by a decrease in energy industrial revenue.
−Removed: Energy industrial revenue decreased by $1.2 million, or 4%, to $26.7 million for the three months ended September 30, 2024 from $27.9 million in the comparable period in 2023.
−Removed: This decrease was driven by a decrease in project-based demand in the subsea market and the global petrochemical and refinery markets of Asia, offset in part by an increase in the global petrochemical and refinery markets of Latin America, Europe, and North America.
−Removed: Energy industrial revenue for the three months ended September 30, 2024 included $5.6 million to a North American distributor, in comparison to $8.0 million for the comparable period of 2023.
−Removed: The average selling price per square foot of our energy industrial products increased by 6% for the three months ended September 30, 2024, compared to the three months ended September 30, 2023.
+Added: Total revenue decreased $15.8 million, or 17%, to $78.7 million for the three months ended March 31, 2025 from $94.5 million in the comparable period in 2024.
+Added: The decrease in total revenue was the result of a decrease in thermal barrier revenue, offset by an increase in energy industrial revenue.
+Added: Energy industrial revenue increased by $0.7 million, or 3%, to $29.8 million for the three months ended March 31, 2025 from $29.1 million in the comparable period in 2024.
+Added: This increase was driven by an increase in the global petrochemical and refinery markets of North America, Asia, Europe, and Latin America, offset in part by a decrease in project-based demand in the subsea market.
+Added: Energy industrial revenue for the three months ended March 31, 2025 included $10.7 million to a North American distributor, in comparison to $7.5 million for the comparable period of 2024.
+Added: The average selling price per square foot of our energy industrial products increased by less than 1% for the three months ended March 31, 2025, compared to the three months ended March 31, 2024.
The increase in average selling price reflected the impact of price increases enacted in 2025 and a change in the mix of products sold, as we strive to maximize capacity in our aerogel manufacturing facility.
−Removed: This increase in average selling price had the effect of increasing product revenue by $1.4 million for the three months ended September 30, 2024 from the comparable period in 2023.
−Removed: In volume terms, energy industrial product shipments decreased by 9% as measured by square feet of our energy industrial products shipped for the three months ended September 30, 2024, compared to the three months ended September 30, 2023.
−Removed: The decrease in volume had the effect of increasing product revenue by $2.5 million for the three months ended September 30, 2024 from the comparable period in 2023.
−Removed: Thermal barrier revenue was $90.5 million for the three months ended September 30, 2024 as compared to $32.8 million for the three months ended September 30, 2023.
−Removed: During the three months ended September 30, 2024 and 2023, thermal barrier revenue included $86.4 million and $29.5 million, respectively, to a major U.S.
+Added: This increase in average selling price had the effect of increasing product revenue by $0.1 million for the three months ended March 31, 2025 from the comparable period in 2024.
+Added: In volume terms, energy industrial product shipments increased by 2% as measured by square feet of our energy industrial products shipped for the three months ended March 31, 2025, compared to the three months ended March 31, 2024.
+Added: The increase in volume had the effect of increasing product revenue by $0.6 million for the three months ended March 31, 2025 from the comparable period in 2024.
+Added: Thermal barrier revenue decreased by $16.5 million, or 25%, to $48.9 million for the three months ended March 31, 2025 from $65.4 million in the comparable period in 2024.
+Added: During the three months ended March 31, 2025 and 2024, thermal barrier revenue included $47.4 million and $60.6 million, respectively, to a major U.S.
automotive OEM.
+Added: The decrease in thermal barrier revenue was driven by reduction in the volume of parts ordered by our OEM customer and lower contractual component price during the quarter compared to the same period in the prior year.
Cost of Revenue
−Removed: Three Months Ended September 30,
+Added: Three Months Ended March 31,
($ in thousands)
3 unchanged sentences
Total cost of revenue
−Removed: Total cost of revenue increased $21.3 million, or 45%, to $68.2 million for the three months ended September 30, 2024 from $46.9 in the comparable period in 2023.
−Removed: The increase in total cost of revenue was the result of an increase in thermal barrier cost of revenue, offset by a decrease in energy industrial cost of revenue.
−Removed: Energy industrial cost of revenue decreased $6.0 million, or 27%, to $16.0 million for the three months ended September 30, 2024 from $22.0 million in the comparable period in 2023, primarily due to a decrease in the volume of products shipped.
−Removed: The $6.0 million decrease was the result of a $5.0 million decrease in manufacturing and other operating costs due to lower volume of Energy industrial products manufactured at our plant as we move manufacturing to the external manufacturing facility, and a $1.0 million decrease in material costs.
−Removed: Thermal barrier cost of revenue increased $27.3 million to $52.2 million for the three months ended September 30, 2024 as compared to $24.9 million for the three months ended September 30, 2023.
−Removed: The $27.3 million increase was the result of a $21.4 million increase in material costs and a $5.9 million increase in manufacturing costs, primarily driven by an increase in volume.
−Removed: Thermal barrier cost of revenue includes a credit of $2.2 million for reimbursement of costs related to the impact from an engineering change notified by a customer to a part that we manufacture for that customer.
−Removed: Three Months Ended September 30,
+Added: Total cost of revenue decreased $3.5 million, or 6%, to $55.9 million for the three months ended March 31, 2025 from $59.4 in the comparable period in 2024.
+Added: The decrease in total cost of revenue was the result of a decrease in thermal barrier cost of revenue, offset by an increase in energy industrial cost of revenue.
+Added: Energy industrial cost of revenue increased $0.6 million, or 3%, to $18.1 million for the three months ended March 31, 2025 from $17.5 million in the comparable period in 2024, primarily due to an increase in the volume of products shipped.
+Added: The $0.6 million increase was the result of a $5.3 million increase in material costs offset by a $4.7 million decrease in manufacturing and other operating costs due to lower volume of energy industrial products manufactured at our plant as we move manufacturing to the external manufacturing facility.
+Added: Thermal barrier cost of revenue decreased $4.1 million, or 10%, to $37.7 million for the three months ended March 31, 2025 from $41.8 million in the comparable period in 2024.
+Added: The $4.1 million decrease was the result of a $6.0 million decrease in material costs offset by a $1.9 million increase in manufacturing costs.
+Added: Three Months Ended March 31,
($ in thousands)
3 unchanged sentences
Total gross profit
−Removed: Gross profit increased by $35.2 million, or 255%, to $49.0 million for the three months ended September 30, 2024 from $13.8 million in the comparable period in 2023.
−Removed: The increase in gross profit was the result of the $56.5 million increase in total revenue, offset by the $21.3 million increase in total cost of revenue.
+Added: Gross profit decreased by $12.3 million, or 35%, to $22.8 million for the three months ended March 31, 2025 from $35.1 million in the comparable period in 2024.
+Added: The decrease in gross profit was the result of the $15.8 million decrease in total revenue, partially offset by the $3.5 million decrease in total cost of revenue.
Research and Development Expenses
−Removed: Three Months Ended September 30,
+Added: Three Months Ended March 31,
($ in thousands)
Research and development expenses
−Removed: Research and development expenses increased by $0.4 million, or 9%, to $4.6 million for the three months ended September 30, 2024 from $4.2 million in the comparable period in 2023.
−Removed: The $0.4 million increase reflects increases in compensation and related costs of $0.2 million, operating supplies and testing of $0.1 million and other expenses of $0.1 million.
−Removed: Research and development expenses as a percentage of total revenue decreased to 4% of total revenue for the three months ended September 30, 2024 from 7% in the comparable period in 2023.
+Added: Research and development expenses decreased by $0.2 million, or 3%, to $4.3 million for the three months ended March 31, 2025 from $4.5 million in the comparable period in 2024.
+Added: The $0.2 million decrease reflects decreases in compensation and related costs of $0.2 million.
+Added: Research and development expenses as a percentage of total revenue increased to 6% of total revenue for the three months ended March 31, 2025 from 5% in the comparable period in 2024.
Sales and Marketing Expenses
−Removed: Three Months Ended September 30,
+Added: Three Months Ended March 31,
($ in thousands)
Sales and marketing expenses
−Removed: Sales and marketing expenses increased by $0.9 million, or 11%, to $9.3 million for the three months ended September 30, 2024 from $8.4 million in the comparable period in 2023.
−Removed: The $0.9 million increase was principally the result of increases in compensation and related costs of $0.4 million, professional fees of $0.3 million, and utilities expenses of $0.2 million.
−Removed: Sales and marketing expenses as a percentage of total revenue decreased to 8% of total revenue for the three months ended September 30, 2024 from 14% in the comparable period in 2023.
+Added: Sales and marketing expenses increased by less than $0.1 million, or 1%, to $8.4 million for the three months ended March 31, 2025 from $8.3 million in the comparable period in 2024.
+Added: Sales and marketing expenses as a percentage of total revenue increased to 11% of total revenue for the three months ended March 31, 2025 from 9% in the comparable period in 2024.
General and Administrative Expenses
−Removed: Three Months Ended September 30,
+Added: Three Months Ended March 31,
($ in thousands)
General and administrative expenses
−Removed: General and administrative expenses increased by $1.9 million, or 12%, to $17.7 million for the three months ended September 30, 2024 from $15.8 million in the comparable period in 2023.
−Removed: The $1.9 million increase was the result of increases in insurance costs of $0.8 million, utilities expenditures of $0.7 million, foreign currency transaction losses of $0.6 million, and professional fees of $0.3 million, offset in part by a decrease in compensation and related costs of $0.3 million and other expenses of $0.2 million.
−Removed: General and administrative expenses as a percentage of total revenue decreased to 15% for the three months ended September 30, 2024 from 26% in the comparable period in 2023.
+Added: General and administrative expenses decreased by $4.2 million, or 24%, to $13.0 million for the three months ended March 31, 2025 from $17.2 million in the comparable period in 2024.
+Added: The $4.2 million decrease was the result of decreases in compensation and related costs of $4.3 million, foreign currency transaction losses of $1.1 million and depreciation and facility related expenses of $0.4 million, partially offset by an increase in insurance costs of $0.8 million, utilities expenditures of $0.7 million and other expenses of $0.1 million.
+Added: Compensation and related costs for the three months ended March 31, 2024 included $2.0 million of charge from the cancellation of the unearned performance-based restricted shares.
+Added: General and administrative expenses as a percentage of total revenue decreased to 17% for the three months ended March 31, 2025 from 18% in the comparable period in 2024.
+Added: Restructuring and demobilization costs
+Added: In February 2025, we announced and began implementing a restructuring plan to realign our operational focus to improve costs and align capital expenditure to anticipated long term demand.
+Added: The plan included reducing our headcount and ceasing construction of our previously planned Statesboro Plant.
+Added: In connection with the demobilization, we are no longer pursuing our application for a loan from the Department of Energy’s Loan Programs Office and have withdrawn from the loan application process.
+Added: Restructuring and demobilization costs include severance and other personnel costs of $2.9 million, facility closures and other costs associated with demobilization of $0.8 million and write off of deferred financing costs of $6.2 million incurred in connection with pursuing financing for the construction of the plant.
+Added: We did not incur restructuring and demobilization costs for the three months ended March 31, 2024.
+Added: Impairment of property, plant and equipment
+Added: Impairment of property, plant and equipment costs increased $283.9 million for the three months ended March 31, 2025 from the comparable period in 2024, due to impairment incurred of $286.6 million on our previously planned Statesboro Plant.
+Added: Impairment of $2.7 million for the three months ended March 31, 2024 was the result of a charge for impairment of equipment under development due to obsolescence following development of new and more efficient equipment.
Other Income (Expense), net
−Removed: Three Months Ended September 30,
+Added: Three Months Ended March 31,
($ in thousands)
1 unchanged sentence
Interest expense, related party
−Removed: Interest income (expense), net
−Removed: Loss on extinguishment of debt
−Removed: Income from Employee Retention Credits
+Added: Interest expense, net
Total other income (expense), net
−Removed: Other income (expense), net decreased by $31.7 million to $30.1 million of other expense for the three months ended September 30, 2024 from $1.6 million of other income (expense), net in the comparable period in 2023.
−Removed: The $31.7 million decrease was the result of a $27.5 million loss on extinguishment of debt, a $0.9 million net impact of capitalized interest relating to our Convertible Note in the comparable period in 2023, a $2.2 million income from Employee Retention Credits in the comparable period in 2023 not repeated in 2024, and a $1.1 million increase of interest expense.
−Removed: Income Tax Expense
−Removed: Three Months Ended September 30,
−Removed: ($ in thousands)
−Removed: Income tax expense
−Removed: The $0.3 million of income tax expense for the three months ended September 30, 2024 is related to our maquiladora operations in Mexico.
−Removed: We did not incur income tax expense for the comparable period in 2023.
−Removed: Results of Operations
−Removed: Nine months ended September 30, 2024 compared to the nine months ended September 30, 2023
−Removed: The following tables set forth a comparison of the components of our results of operations for the periods presented:
−Removed: Nine Months Ended September 30,
−Removed: Percentage of
−Removed: Percentage of
−Removed: ($ in thousands)
−Removed: Energy industrial
−Removed: Thermal barrier
−Removed: Total revenue
−Removed: Total revenue increased $175.1 million, or 113%, to $329.6 million for the nine months ended September 30, 2024 from $154.5 million in the comparable period in 2023.
−Removed: The increase in total revenue was the result of an increase in thermal barrier revenue, offset by a decrease energy industrial revenue.
−Removed: Energy industrial revenue decreased by $4.5 million, or 5%, to $92.8 million for the nine months ended September 30, 2024 from $97.3 million in the comparable period in 2023.
−Removed: This decrease was driven by a decrease in revenue to the global petrochemical and refinery markets of Asia and project-based demand in the subsea market, offset in part by an a more favorable mix of product shipments in the global petrochemical and refinery markets in North America, Latin America and Europe.
−Removed: Energy industrial revenue for the nine months ended September 30, 2024 included $19.1 million to a North American distributor, in comparison to $27.6 million for the comparable period of 2023.
−Removed: The average selling price per square foot of our energy industrial products increased by 12% for nine months ended September 30, 2024, compared to the nine months ended September 30, 2023.
−Removed: The increase in average selling price reflected the impact of price increases enacted in 2023 and a change in the mix of products sold, as we strive to maximize capacity in our aerogel manufacturing facility.
−Removed: This increase in average selling price had the effect of increasing product revenue by $9.9 million for the nine months ended September 30, 2024 from the comparable period in 2023.
−Removed: In volume terms, energy industrial product shipments decreased by 15% as measured by square feet of our energy industrial products shipped for the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023.
−Removed: The decrease in volume had the effect of decreasing product revenue by $14.5 million for the nine months ended September 30, 2024 from the comparable period in 2023.
−Removed: Thermal barrier revenue was $236.8 million for the nine months ended September 30, 2024 as compared to $57.2 million for the nine months ended September 30, 2023.
−Removed: During the nine months ended September 30, 2024 and 2023, thermal barrier revenue included $223.8 million and $49.0 million, respectively, to a major U.S.
−Removed: automotive OEM.
−Removed: Cost of Revenue
−Removed: Nine Months Ended September 30,
−Removed: ($ in thousands)
−Removed: Cost of revenue:
−Removed: Energy industrial
−Removed: Thermal barrier
−Removed: Total cost of revenue
−Removed: Total cost of revenue increased $66.6 million, or 52%, to $193.8 million for the nine months ended September 30, 2024 from $127.2 million in the comparable period in 2023.
−Removed: The increase in total cost of revenue was the result of an increase in thermal barrier cost of revenue, offset by a decrease in energy industrial cost of revenue.
−Removed: Energy industrial cost of revenue decreased $18.1 million, or 25%, to $55.0 million for the nine months ended September 30, 2024 from $73.1 million in the comparable period in 2023, primarily due to a decrease in the volume of products shipped and shift in manufacturing to the external manufacturing facility.
−Removed: The $18.1 million decrease was the result of a $2.0 million decrease in material costs and a $16.1 million decrease in manufacturing and other operating costs from the comparable period in 2023.
−Removed: Thermal barrier cost of revenue increased $84.7 million to $138.8 million for the nine months ended September 30, 2024 as compared to $54.1 million in the comparable period in 2023.
−Removed: The $84.7 million increase was the result of a $63.2 million increase in material costs and a $21.5 million increase in manufacturing costs, primarily driven by an increase in volume.
−Removed: Nine Months Ended September 30,
−Removed: ($ in thousands)
−Removed: Gross profit:
−Removed: Energy industrial
−Removed: Thermal barrier
−Removed: Total gross profit (loss)
−Removed: Gross profit increased by $108.5 million, or 397%, to $135.8 million for the nine months ended September 30, 2024 from $27.3 million of gross profit in the comparable period in 2023.
−Removed: The increase in gross profit was the result of the $175.1 million increase in total revenue, offset by the $66.6 million increase in total cost of revenue.
−Removed: Research and Development Expenses
−Removed: Nine Months Ended September 30,
−Removed: ($ in thousands)
−Removed: Research and development expenses
−Removed: Research and development expenses increased by $1.3 million, or 11%, to $13.6 million for the nine months ended September 30, 2024 from $12.3 million in the comparable period in 2023.
−Removed: The $1.3 million increase reflects increases in compensation and related costs of $0.8 million, depreciation and facility related expenses of $0.3 million, and other expenses of $0.2 million.
−Removed: Research and development expenses as a percentage of total revenue decreased to 4% of total revenue for the nine months ended September 30, 2024 from 8% in the comparable period in 2023.
−Removed: Sales and Marketing Expenses
−Removed: Nine Months Ended September 30,
−Removed: ($ in thousands)
−Removed: Sales and marketing expenses
−Removed: Sales and marketing expenses increased by $2.9 million, or 12%, to $27.1 million for the nine months ended September 30, 2024 from $24.2 million in the comparable period in 2023.
−Removed: The $2.9 million increase was principally the result of increases in compensation and related costs of $1.7 million, depreciation and facility related expenses of $0.9 million, and utilities expenses of $0.3 million.
−Removed: Sales and marketing expenses as a percentage of total revenue decreased to 8% of total revenue for the nine months ended September 30, 2024 from 16% in the comparable period in 2023.
−Removed: General and Administrative Expenses
−Removed: Nine Months Ended September 30,
−Removed: ($ in thousands)
−Removed: General and administrative expenses
−Removed: General and administrative expenses increased by $11.1 million, or 27%, to $52.5 million for the nine months ended September 30, 2024 from $41.4 million in the comparable period in 2023.
−Removed: The $11.1 million increase was the result of additional staffing costs combined with increases in compensation and related costs of $4.5 million, foreign currency transaction losses of $2.0 million, insurance costs of $2.0 million, utilities expenditures of $1.7 million, and legal costs of $0.9 million.
−Removed: Compensation and related costs include $2.0 million of charge from the cancellation of the unearned performance-based restricted shares.
−Removed: General and administrative expenses as a percentage of total revenue decreased to 16% for the nine months ended September 30, 2024 from 27% in the comparable period in 2023.
−Removed: Impairment of Equipment Under Development
−Removed: The $2.7 million impairment of equipment under development was the result of a charge for impairment of assets due to obsolescence following development of new and more efficient equipment.
−Removed: Other Income (Expense), net
−Removed: Nine Months Ended September 30,
−Removed: ($ in thousands)
−Removed: Interest income (expense):
−Removed: Interest (expense), related party
−Removed: Interest income (expense), net
−Removed: Loss on extinguishment of debt
−Removed: Income from Employee Retention Credits
−Removed: Total interest income (expense), net
−Removed: Other income (expense), net decreased by $41.2 million to $35.9 million of other expense for the nine months ended September 30, 2024 from $5.3 million of other income (expense), net in the comparable period in 2023.
−Removed: The $41.2 million decrease was the result of a $27.5 million loss on extinguishment of debt, $6.1 million net impact of capitalized interest relating to our Convertible Note in the comparable period in 2023, $1.8 million of deferred financing costs related to the GM Loan Agreement for which the draw down date has expired, a $2.2 million income from Employee Retention Credits in the comparable period in 2023 not repeated in 2024, a $1.9 million decrease of interest income, and a $1.7 million increase of interest expense.
+Added: The $3.0 million decrease of interest expense, related party for the three months ended March 31, 2025 is the result of the repurchase of the convertible note in August 2024.
+Added: The $1.5 million increase in interest expense, net for the three months ended March 31, 2025 is the result of a $4.4 million increase in interest expense from the MidCap Loan Facility and sale and leaseback transactions, offset by $1.7 million of deferred financing costs written off related to the loan agreement with GM during the three months ended March 31, 2024 which did not repeat during the comparable period and an increase in interest income of $1.2 million.
+Added: The other income increase of $1.1 million for the three months ended March 31, 2025 is the result of a legal settlement payment to us.
Income Tax Expense
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
($ in thousands)
Income tax expense
−Removed: The $1.9 million of income tax expense for the nine months ended September 30, 2024 is related to our maquiladora operations in Mexico.
−Removed: We did not incur income tax expense for the comparable period in 2023.
+Added: The $1.1 million of income tax expense for the three months ended March 31, 2025 is related to our maquiladora operations in Mexico, in addition to a provision for state income taxes of less than $0.1 million.
+Added: We incurred $0.8 million of income tax expense related to our maquiladora operations in Mexico for the comparable period in 2024.
Liquidity and Capital Resources
2 unchanged sentences
Our long-term financial projections anticipate revenue growth, increasing levels of gross profit, and improved cash flows from operations.
−Removed: To meet expected growth in demand for our aerogel products in the EV market, we have been in the process of expanding our aerogel blanket capacity by constructing a second manufacturing plant in Bulloch County, Georgia.
−Removed: However, in order to manage the development of the second plant so that its increased capacity comes online in a manner that aligns with our current expectations of demand from our EV customers, we are extending the timeframe for construction and commissioning of the second plant until such time as its capacity is supported by increased demand.
−Removed: In the meantime, and until we ramp up construction, we expect to be able to substantially reduce our planned capital expenditures for 2024.
−Removed: At the same time, we believe that productivity improvements in our existing Rhode Island facility combined with the supplemental supply of our energy industrial products from one or more external manufacturing facilities in China will permit us to achieve a target revenue capacity of approximately $650 million in 2024 and prior to the completion and start-up of the second plant.
−Removed: Nonetheless, there can be no assurance as to when we will ramp up construction on the second plant.
−Removed: There can also be no assurance that our contract manufacturing strategy of meeting the demand of our energy industrial customers with supply from one or more external manufacturing facilities in China will provide us with adequate manufacturing capacity or supply for that expected demand.
−Removed: Furthermore, when we ramp up construction on the second plant, further cost inflation and/or supply chain disruptions, as well as potential changes in the scope of the facilities, could lead to increases to our prior estimated costs for completion of the second plant.
−Removed: We are also increasing our investment in the research and development of next-generation aerogel products and technologies.
−Removed: During 2024, we have and will continue to develop aerogel products and technologies for the EV market.
−Removed: We believe the commercial potential for our technology in the EV market is significant.
−Removed: To meet the anticipated revenue growth and take advantage of this market opportunity, we are adding personnel and incurring additional operating expenses, among other items.
−Removed: In January and September 2024, we entered into sale and leaseback arrangements, pursuant to which we sold certain equipment to an equipment leasing company for two separate one-time cash payments of $5.0 million and $10.0 million and leased back such equipment from the leasing company.
−Removed: The associated monthly lease rents will be paid over the term of three years.
−Removed: In October 2024, we entered into an underwriting agreement (the Underwriting Agreement) with Goldman Sachs & Co.
−Removed: LLC and Morgan Stanley & Co.
−Removed: LLC (collectively, the Underwriters), pursuant to which we issued and sold an aggregate of 4,887,500 shares of our common stock, which included 637,500 shares pursuant to the Underwriters’ option to purchase additional shares of our common stock, to the Underwriters in a registered underwritten offering (the “Offering”).
−Removed: The price to the public in the Offering was $20.00 per share.
−Removed: The net proceeds to us from the Offering were approximately $93.2 million, after deducting underwriting discounts and commissions and estimated offering expenses payable by us.
−Removed: On August 19, 2024, we entered into a Credit, Security and Guaranty Agreement with MidCap Financial for a term loan facility in an aggregate principal amount of $125.0 million and an asset-based revolving credit facility in an aggregate principal amount not to exceed the lesser of $100.0 million or the borrowing base.
−Removed: At closing we drew $125.0 million from the Term Loan Facility and $43.0 million from the revolving loan facility.
−Removed: The proceeds of the borrowings, net of fees and costs, were used for repurchasing of the Convertible Notes for $150.0 million and for general corporate purposes.
−Removed: We believe that our September 30, 2024 cash and cash equivalents balance of $113.5 million, together with the funds available under the MidCap Loan Facility, will be sufficient to support current operating requirements, current research and development activities and the initial capital expenditures required to support the evolving commercial opportunities in the EV market and other strategic business opportunities.
−Removed: We plan to supplement our cash balance and available credit with equity financings, debt financings, equipment leasing, customer prepayments or government grant and loan programs to provide the additional capital necessary to purchase the capital equipment, construct the new facilities and complete the aerogel capacity expansions required to support our evolving commercial opportunities and strategic business initiatives.
−Removed: We believe that consummation of equity financing could potentially result in an ownership change under Section 382 of the U.S.
−Removed: Internal Revenue Code of 1986, as amended.
+Added: To meet expected demand for our aerogel products, we plan to make additional productivity improvements in our existing East Providence facility and utilize a flexible supply strategy, including but not limited to use of our external manufacturing capabilities in China, which currently support our Energy Industrial segment and are capable of delivering increased aerogel production capacity.
+Added: We expect that the productivity improvements in our existing East Providence facility as well as the supply from our external manufacturing facility will permit us to achieve our target revenue capacity in 2025 and in the long-term.
+Added: Accordingly, we have ceased construction at our previously planned Statesboro Plant.
+Added: We will be demobilizing the plant and are in the process of assessing options to derive value from the assets, including potentially relocating certain equipment to improve and expand our existing manufacturing facility in East Providence.
+Added: On August 19, 2024, we entered into the Credit Agreement with the Agent and the Lenders.
+Added: The MidCap Loan Facility under the Credit Agreement is comprised of (i) the Term Loan Facility in an aggregate principal amount of $125.0 million and (ii) the Revolving Facility in an aggregate principal amount not to exceed the lesser of $100.0 million and the value of the Borrowing Base.
+Added: At closing of the Credit Agreement, the Company drew $125.0 million from the Term Loan Facility and $43.0 million from the Revolving Facility.
+Added: The proceeds of the borrowings at closing, net of fees and costs, were used for repurchasing the 2022 Convertible
+Added: Notes for $150.0 million and for general corporate purposes.
+Added: On May 6, 2025, the Credit Agreement was amended adding Aspen Georgia as a Borrower and amending the MidCap Loan Facility.
+Added: See Part II – Other Information – Item 5 – Other Information for further details.
+Added: In January 2024 and September 2024, we entered into sale and leaseback arrangements, pursuant to which we sold certain equipment to an equipment leasing company for one-time cash payments of $5.0 million and $10.0 million, respectively, and leased back such equipment from the leasing company.
+Added: The associated monthly lease rents will be paid over the lease term of three years.
+Added: We believe that our March 31, 2025 cash and cash equivalents balance of $192.0 million, together with the funds available under the MidCap Loan Facility, will be sufficient to support current operating requirements, current research and development activities and the capital expenditures required to support the evolving commercial opportunities in the EV market and other strategic business opportunities.
+Added: However, we may supplement our cash balance and available credit with equity financings, debt financings, equipment leasing, sale-leaseback transactions, customer prepayments or government grant and loan programs to provide the additional capital necessary to purchase the capital equipment, construct the new facilities and complete the aerogel capacity expansions required to support our evolving commercial opportunities and strategic business initiatives.
+Added: We believe that consummation of equity financings could potentially result in an ownership change under Section 382 of the Internal Revenue Code.
Such an ownership change would lead to the use of our net operating loss carryforwards being restricted.
1 unchanged sentence
Primary Sources of Liquidity
−Removed: Our principal sources of liquidity are currently our cash and cash equivalents.
+Added: Our principal sources of liquidity are currently our cash and cash equivalents, availability under the Revolving Facility, and cash generated by ongoing operations.
Cash and cash equivalents consist primarily of cash, money market accounts, and sweep accounts on deposit with banks.
−Removed: As of September 30, 2024, we had $113.5 million of unrestricted cash and cash equivalents.
+Added: As of March 31, 2025, we had $192.0 million of unrestricted cash and cash equivalents.
Analysis of Cash Flow
−Removed: Net Cash Used in Operating Activities
−Removed: During the nine months ended September 30, 2024, we provided $9.9 million in net cash in operating activities, as compared to the use of $39.8 million in net cash during the comparable period in 2023, a decrease in the use of cash of $49.7 million.
−Removed: This decrease in use of cash was the result of net income adjusted for non-cash items of $97.8 million offset by net cash used by changes in operating assets and liabilities of $48.1 million.
−Removed: During the nine months ended September 30, 2023, we used $39.8 million in net cash in operating activities, as compared to the use of $70.3 million in net cash during the comparable period in 2022, a decrease in the use of cash of $30.5 million.
−Removed: This decrease in use of cash was the result of lower net loss adjusted for non-cash items of $31.4 million offset by net cash used by changes in operating assets and liabilities of $0.9 million.
+Added: Three Months Ended
+Added: (In thousands)
+Added: Net cash provided by (used in):
+Added: Operating activities
+Added: Investing activities
+Added: Financing activities
+Added: Net decrease in cash
+Added: Cash, cash equivalents and restricted cash at beginning of period
+Added: Cash, cash equivalents and restricted cash at end of period
+Added: Net Cash Provided by (Used in) Operating Activities
+Added: During the three months ended March 31, 2025, we generated $5.6 million in net cash in operating activities, as compared to the use of $17.7 million in net cash during the comparable period in 2024, an increase in cash provided by operations of $23.3 million.
+Added: This increase in cash provided by operations was the result of an increase in net cash generated by changes in operating assets and liabilities of $48.9 million, offset by a decrease in net loss adjusted for non-cash items of $25.6 million.
Net Cash Used in Investing Activities
−Removed: Net cash used in investing activities is for capital expenditures for machinery and equipment principally to improve the throughput, efficiency and capacity of our East Providence facility, expansion of our automated fabrication facility in Mexico and engineering designs and construction costs for the planned aerogel manufacturing facility in Bulloch County, Georgia.
−Removed: Net cash used in investing activities for the nine months ended September 30, 2024 and 2023 was $71.5 million and $147.7 million, respectively.
−Removed: Net Cash Provided by Financing Activities
−Removed: Net cash provided by financing activities for the nine months ended September 30, 2024 totaled $35.6 million and consisted of $15.0 million in proceeds from a sales leaseback, $10.4 million in proceeds from employee stock option exercises, $119.7 in proceeds from the term loan, net of issues costs, and $42.7 in proceeds from the revolver, net of issuance costs, offset by $150.0 million in cash used for the repayment of the convertible note, $1.3 million in cash used for payments made for employee tax withholdings associated with the vesting of restricted stock units, $0.8 million in repayments of a sales leaseback, and less than $0.1 million in cash used for fees and issuance costs.
−Removed: Net cash used in financing activities for the nine months ended September 30, 2023 totaled $0.1 million and consisted of $0.4 million in cash used for payments made for employee tax withholdings associated with the vesting of restricted stock units and $0.1 million issuance costs from private placement of common stock, offset, in part, by $0.4 million in proceeds from employee stock option exercises.
+Added: Net cash used in investing activities is for capital expenditures for machinery and equipment principally to improve the throughput, efficiency and capacity of our East Providence facility, our automated fabrication facility in Mexico and construction costs for the previously planned Statesboro Plant.
+Added: Net cash used in investing activities for the three months ended March 31, 2025 and 2024 was $13.0 million and $25.9 million, respectively.
+Added: Net Cash Provided by (Used in) Financing Activities
+Added: Net cash used in financing activities for the three months ended March 31, 2025 totaled $21.5 million and consisted of $13.2 million in cash used for the repayment of the revolver, $6.5 for the repayment of the Term Loan Facility, $1.2 in repayments of the finance obligation under the sale and leaseback transaction, $0.6 million for payments made for employee tax withholdings associated with the vesting of RSUs, and less than $0.1 million in cash used for fees and issuance costs.
+Added: Net cash provided by financing activities for the three months ended March 31, 2024 totaled $5.3 million and consisted of $5.0 million in proceeds from a sale and leaseback transaction and $1.4 million in proceeds from employee stock option exercises, offset by $1.1 million in cash used for payments made for employee tax withholdings associated with the vesting of restricted stock units.
Contractual Obligations and Commitments
1 unchanged sentence
Recent Accounting Pronouncements
−Removed: Information regarding new accounting pronouncements is included in note 2 to our unaudited consolidated financial statements contained in Item 1 of this Quarterly Report on Form 10-Q.
+Added: Information regarding new accounting pronouncements is included in "Note 2.
+Added: Significant Accounting Policies." to our unaudited consolidated financial statements contained in Item 1 of this Quarterly Report on Form 10-Q.
Critical Accounting Policies and Estimates
4 unchanged sentences
Our actual results may differ from these estimates under different assumptions and conditions.
−Removed: See our Annual Report and note 2 to our consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for information about these critical accounting policies, as well as a description of our other significant accounting policies.
+Added: See our Annual Report and "Note 2.
+Added: Significant Accounting Policies." to our consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for information about these critical accounting policies, as well as a description of our other significant accounting policies.
Certain Factors That May Affect Future Results of Operations
3 unchanged sentences
Forward-looking statements include, but are not limited to, statements about:
−Removed: the expected future growth of the market for our aerogel products and our continued gain in market share, in particular in the electric vehicle market, the energy infrastructure insulation market, the lithium-ion battery thermal barrier markets, and other markets we target;
+Added: our expectations about the market for our aerogel products, in particular in the electric vehicle market, the energy infrastructure insulation market, the lithium-ion battery thermal barrier markets, and other markets we target;
our beliefs in the appropriateness of our assumptions, the accuracy of our estimates regarding expenses, loss contingencies, future revenues, revenue capacity, future profits, uses of cash, available credit, capital requirements, and the need for additional financing to operate our business and for capital expenditures and to fund our planned strategic business initiatives;
−Removed: the performance of our aerogel blankets;
+Added: the performance of our aerogel products;
our expectation that we will be successful in obtaining, enforcing and defending our patents against competitors and that such patents are valid and enforceable;
−Removed: our expectations regarding the investment and revenue creation from the Statesboro Plant and creation of jobs from the construction and operation of the Statesboro Plant;
−Removed: our efforts to manage the extended construction and commission timeframe of the planned Statesboro Plant to align with our expectations of demand from EV customers;
+Added: our expectations regarding decommissioning of the Statesboro Plant;
our estimates of annual production capacity;
5 unchanged sentences
the current or future trends in the energy, energy infrastructure, chemical and refinery, LNG, sustainable building materials, electric vehicle thermal barrier, electric vehicle battery materials or other markets and the impact of these trends on our business;
−Removed: our investments in the electric vehicle market and Aerogel Technology Platform;
+Added: our investments in the electric vehicle market;
our beliefs about the financial metrics that are indicative of our core performance;
1 unchanged sentence
our expectations about future revenues, expenses, gross profit, net income (loss), income (loss) per share and Adjusted EBITDA, sources and uses of cash, capital requirements and the sufficiency of our existing cash balance and available credit;
−Removed: our beliefs about the outcome, effects or estimated costs of current or potential litigation or their respective timing, including expected legal expense in connection with our patent enforcement actions;
−Removed: our expectations about future material costs and manufacturing expenses as a percentage of revenue, including the impact of engaging one or more external manufacturing facilities in China for supply of our energy industrial products;
+Added: our beliefs about the outcome, effects or estimated costs of current or potential litigation or their respective timing, including expected legal expense in
+Added: connection with our patent enforcement actions;
+Added: our expectations about future material costs and manufacturing expenses as a percentage of revenue;
our expectation about the ability of the Chinese external manufacturing facilities that we engage to consistently supply the aerogel product that we order in a timely manner;
+Added: our expectation to meet long-term aerogel demand by maximizing capacity at our East Providence facility and utilizing a flexible supply strategy, including, but not limited to, using external manufacturing capabilities;
+Added: the potential effects of tariffs on our business and results of operations;
our expectations of future gross profit and the effect of manufacturing expenses, manufacturing capacity and productivity on gross profit;
2 unchanged sentences
our expectations of revenue growth, increased gross profit, and improving cash flows over the long term;
−Removed: our intentions about managing capital
−Removed: expenditures and working capital balances;
−Removed: our expectation with respect to the receipt and funding of the Loan, including satisfaction of certain technical, legal, environmental, and financial conditions before the DOE enters into definitive financing documents and funds the Loan;
−Removed: our expectation with respect to the ability of the DOE loan to fully fund the remaining CAPEX needed to complete the Statesboro Plant;
−Removed: our expectations and beliefs regarding the use of proceeds from the Loan facility, the flexibility and efficiency of the facility;
+Added: our intentions about managing capital expenditures and working capital balances;
+Added: our expectations and beliefs regarding the flexibility and efficiency of the MidCap facility;
and our expectations about potential sources of future financing.
14 unchanged sentences
We are exposed to changes in interest rates in the normal course of our business.
−Removed: As of September 30, 2024, we had unrestricted cash and cash equivalents of $113.5 million.
+Added: As of March 31, 2025, we had unrestricted cash and cash equivalents of $192.0 million.
These amounts were held for working capital and capital expansion purposes and were invested primarily in deposit accounts, money market accounts, and high-quality debt securities issued by the U.S.
−Removed: government via cash sweep accounts primarily at major financial institutions in North America.
+Added: government via cash sweep accounts at major financial institutions in North America.
Due to the short-term nature of these investments, we believe that our exposure to changes in the fair value of our cash as a result of changes in interest rates is not material.
−Removed: As of September 30, 2024, we had a term loan outstanding with principal balance of $127.5 million.
−Removed: Our term loan bears interest at the Secured Overnight Financing Rate (SOFR) plus 4.50% per annum.
−Removed: Under the terms of the investment, SOFR has a floor of 4.50% and a cap of 7.50%.
−Removed: Interest is paid quarterly.
−Removed: As of September 30, 2024, we had a revolving facility outstanding with principal balance of $43.0 million.
−Removed: Our revolving facility bears interest at the SOFR plus 4.60% per annum.
−Removed: Under the terms of the investment, SOFR has a floor of 2.50%.
+Added: As of March 31, 2025, the Term Loan Facility had a principal balance of $112.0 million.
+Added: Under the terms of the Credit Agreement, the Term Loan Facility bears an interest rate equal to Term SOFR for a one-month interest period plus 4.50% per year, subject to a Term SOFR floor of 4.50% and a Term SOFR cap of 7.50%.
Interest is paid monthly.
−Removed: The amount available to us under the revolving credit facility was $25.7 million.
−Removed: As of September 30, 2024, we had $0.4 million of restricted cash to support our outstanding letters of credit to secure obligations under certain commercial contracts and other obligations.
−Removed: We terminated our revolving credit facility agreement on November 28, 2022.
+Added: As of March 31, 2025, the Revolving Facility had a principal balance of $29.8 million.
+Added: Our Revolving Facility bears interest at the Term SOFR plus 4.60% per annum.
+Added: Under the terms of the Credit Agreement, the Revolving Facility is subject to a Term SOFR floor of 2.50%.
+Added: Interest is paid monthly.
+Added: Therefore, fluctuations in interest rates will impact our consolidated financial statements.
+Added: A rising interest rate environment will increase the amount of interest paid on these loans.
+Added: A hypothetical 100 basis point increase or decrease in interest rates would not have a material effect on the results of our operations.
+Added: As of March 31, 2025, we had $0.4 million of restricted cash to support our outstanding letters of credit to secure obligations under certain commercial contracts and other obligations.
Inflation Risk
3 unchanged sentences
We are subject to inherent risks attributed to operating in a global economy.
−Removed: We do not consider the exposure to foreign currency risk from our international operations to be material.
A majority of our revenue, receivables, purchases and debts are denominated in U.S.
Certain transactions of the Company and its subsidiaries are denominated in currencies other than the functional currency.
−Removed: Foreign currency transaction losses were $2.3 million and $0.3 million for the nine months ended September 30, 2024, and 2023, respectively, and were recorded within operating expenses on the consolidated statements of operations.
+Added: During the three months ended March 31, 2025 and 2024, our largest exposures to foreign exchange rates consisted primarily of the Mexican Peso against the U.S.
+Added: Foreign currency transaction losses were $0.4 million for the three months ended March 31, 2025 and foreign currency transaction gains were $0.7 million for the three months ended March 31, 2024.
+Added: The foreign currency transactions were recorded within operating expenses on the consolidated statements of operations.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.