What changed in this filing

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Item 1. Financial Statements

2025-08-05 compared with 2025-05-12 · 138 added, 70 removed, 407 unchanged (34% of the section changed)

7 unchanged sentences

Short-term investments

12,420 10,184

Accounts receivable, less current expected credit loss of $ 108 and $ 106 , respectively

41 unchanged sentences

Three Months Ended

Six Months Ended

Costs and expenses:

4 unchanged sentences

Interest income

Other (expense) income, net

(Loss) income before income taxes

Other income (expense), net

Loss before income taxes

Income tax expense

Net (loss) income

Net (loss) income per common share:

Basic net (loss) income per common share

Diluted net (loss) income per common share

Net loss per common share:

Basic net loss per common share

Diluted net loss per common share

Weighted-average number of common shares outstanding:

1 unchanged sentence

FUEL TECH, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in thousands)

Three Months Ended

Net (loss) income

Six Months Ended

Other comprehensive income (loss):

Foreign currency translation adjustments

Comprehensive (loss) income

Comprehensive loss

See notes to condensed consolidated financial statements.

2 unchanged sentences

(Unaudited)(in thousands of dollars or shares, as appropriate)

The following summarizes the changes in total stockholders' equity for the three months ended March 31, 2024:

The following summarizes the changes in total stockholders' equity for the three and six months ended June 30, 2024:

Comprehensive

3 unchanged sentences

Balance at March 31, 2024

The following summarizes the changes in total stockholders' equity for the three months ended March 31, 2025:

Foreign currency translation adjustments

Stock compensation expense

Common shares issued upon vesting of restricted stock units

Taxes paid on behalf of equity award participants

Balance at June 30, 2024

The following summarizes the changes in total stockholders' equity for the three and six months ended June 30, 2025:

Comprehensive

5 unchanged sentences

Balance at March 31, 2025

Foreign currency translation adjustments

Stock compensation expense

Common shares issued upon vesting of restricted stock units

Taxes paid on behalf of equity award participants

Balance at June 30, 2025

See notes to condensed consolidated financial statements.

2 unchanged sentences

(in thousands)

Three Months Ended

Six Months Ended

Operating Activities

Net (loss) income

Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Non-cash interest income on held-to-maturity securities

22 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2025

June 30, 2025

(in thousands, except share and per-share data)

16 unchanged sentences

All significant intercompany transactions and balances have been eliminated.

The results of operations for the three months ended March 31, 2025 are not necessarily indicative of the results to be expected for the full year ending December 31, 2025 .

The results of operations for the three and six months ended June 30, 2025 are not necessarily indicative of the results to be expected for the full year ending December 31, 2025 .

For further information, refer to the audited consolidated financial statements and footnotes thereto included in Fuel Tech’s Annual Report on Form 10 -K for the year ended December 31, 2024 as filed with the Securities and Exchange Commission.

5 unchanged sentences

GAAP on accounting for government assistance to for-profit business entities, we account for the ERC by analogy to International Accounting Standard ("IAS") 20, Accounting for Government Grants and Disclosure of Government Assistance.

In accordance with IAS 20, management determined it has reasonable assurance for receipt of the ERC and recorded the ERC benefit of $ 1,677 as other income on the Statement of Operations for the year ended December 31, 2024 and as a component of Accounts Receivable on the Balance Sheet as of March 31, 2025 .

We received payment for $ 1,232 of the outstanding receivable during the three months ended June 30, 2025 .

The remaining ERC benefit receivable of $ 511 , which includes an additional $ 67 of interest receivable recorded during the three months ended June 30, 2025, is presented as a component of Accounts receivable on the Balance Sheet as of June 30, 2025 .

Summary of Significant Accounting Policies

3 unchanged sentences

A portion of the funds invested are restricted as collateral under the Investment Collateral Security agreement (see Note 10 ).

At March 31, 2025 , the amount of funds collateralized under the Investment Collateral Security agreement is $ 3,186 relating to existing standby letters of credit that is comprised of $ 2,608 with varying maturity dates that expire no later than March 31, 2026 and $ 578 with the latest maturity date no later than February 28, 2027.

At June 30, 2025 , the amount of funds collateralized under the Investment Collateral Security agreement is $ 4,385 relating to existing standby letters of credit that is comprised of $ 2,933 with varying maturity dates that expire no later than June 30, 2026 and $ 1,452 with a latest maturity date of March 31, 2027.

We consider all highly liquid debt investments with original maturities from the date of purchase of three months or less as cash equivalents.

12 unchanged sentences

Held-to-maturity debt securities:

March 31, 2025

June 30, 2025

December 31, 2024

4 unchanged sentences

$ 20,405 $ 21,076

$ 19,396 $ 21,076

The following table provides the amortized cost and fair value of debt securities by maturities at March 31, 2025 :

The following table provides the amortized cost and fair value of debt securities by maturities at June 30, 2025 :

Amortized Cost

5 unchanged sentences

Inventories consist primarily of equipment constructed for resale and spare parts and are stated at the lower of cost or net realizable value, using the weighted-average cost method.

At March 31, 2025 and December 31, 2024 , inventory included equipment constructed for resale of $ 176 and spare parts, net of reserves, of $ 358 and $ 221 , respectively.

At June 30, 2025 and December 31, 2024 , inventory included equipment constructed for resale of $ 176 and spare parts, net of reserves, of $ 440 and $ 221 , respectively.

Usage is recorded in cost of sales in the period that parts were issued to a project, used to service equipment, or sold to customers.

Equipment constructed for resale that is in process is recorded in Other assets.

In process equipment for inventory recorded as Other assets was $ 46 and $ 44 as of March 31, 2025 and December 31, 2024 , respectively.

In process equipment for inventory recorded as Other assets was $ 44 and $ 44 as of June 30, 2025 and December 31, 2024 , respectively.

In ventories are periodically evaluated to identify obsolete or otherwise impaired parts and are written off when management determines usage is not probable.

14 unchanged sentences

(Write-offs) / Recoveries

At March 31, 2025

At June 30, 2025

Disaggregated Revenue by Product Technology

1 unchanged sentence

Three Months Ended

Six Months Ended

Air Pollution Control

1 unchanged sentence

$ 1,644 $ 2,619 $ 2,216 $ 4,283

425 805 675 1,004

Ancillary revenue

436 525 917 980

Total Air Pollution Control technology revenues

2,505 3,949 3,808 6,267

FUEL CHEM technology solutions

3,053 3,093 8,132 5,732

Total Revenues

3 unchanged sentences

Three Months Ended

Six Months Ended

United States

2 unchanged sentences

Latin America

65 293 413 608

707 1,252 1,184 842

156 436 194 1,702

188 590 348 781

Total Foreign Revenues

1,116 2,571 2,139 3,933

Total Revenues

3 unchanged sentences

Three Months Ended

Six Months Ended

Products transferred at a point in time

1 unchanged sentence

Products and services transferred over time

1,644 2,619 2,216 4,283

Total Revenues

5 unchanged sentences

These assets are reported on the Condensed Consolidated Balance Sheets on a contract-by-contract basis at the end of each reporting period.

At March 31, 2025 , December 31, 2024 , and December 31, 2023 , contract assets for APC technology projects were approximately $ 572 , $ 2,075 , and $ 2,285 , respectively.

At June 30, 2025 , December 31, 2024 , and December 31, 2023 , contract assets for APC technology projects were approximately $ 1,064 , $ 2,075 , and $ 2,285 , respectively.

The Company will periodically bill in advance of costs incurred before revenue is recognized, resulting in contract liabilities.

These liabilities are reported on the Condensed Consolidated Balance Sheets on a contract-by-contract basis at the end of each reporting period.

Contract liabilities were $ 627 , $ 721 , and $ 1,279 at March 31, 2025 , December 31, 2024 , and December 31, 2023 , respectively, and are included in other accrued liabilities on the Condensed Consolidated Balance Sheets.

Changes in the contract asset and liability balances during the three -month period ended March 31, 2025 were not materially impacted by any other items other than amounts billed and revenue recognized as described previously.

Revenue recognized that was included in the contract liability balance at the beginning of the period was $ 372 and $ 1,121 for the three months ended March 31, 2025 and 2024 , respectively, which represented revenue from progress towards completion of our APC technology contracts.

As of March 31, 2025 and December 31, 2024 , we had no construction contracts in progress that were identified as a loss contract.

Contract liabilities were $ 1,683 , $ 721 , and $ 1,279 at June 30, 2025 , December 31, 2024 , and December 31, 2023 , respectively, and are included in other accrued liabilities on the Condensed Consolidated Balance Sheets.

Changes in the contract asset and liability balances during the six -month period ended June 30, 2025 were not materially impacted by any other items other than amounts billed and revenue recognized as described previously.

Revenue recognized that was included in the contract liability balance at the beginning of the period was $ 171 and $ 543 for the three and six months ended June 30, 2025 , respectively, and $ 438 and $ 1,221 for the three and six months ended June 30, 2024 , respectively, which represented revenue from progress towards completion of our APC technology contracts.

As of June 30, 2025 and December 31, 2024 , we had no construction contracts in progress that were identified as a loss contract.

Remaining Performance Obligations

Remaining performance obligations represents the transaction price of APC technology booked orders for which work has not been performed.

As of March 31, 2025 , the aggregate amount of the transaction price allocated to remaining performance obligations was $ 10,328 .

As of June 30, 2025 , the aggregate amount of the transaction price allocated to remaining performance obligations was $ 7,811 .

The Company expects to recognize revenue on approximately $ 5,045 of the remaining performance obligations over the next 12 months with the remaining recognized thereafter.

1 unchanged sentence

The components of accounts receivable are as follows:

March 31, 2025

June 30, 2025

December 31, 2024

11 unchanged sentences

This action was part of Fuel Tech’s ongoing operational improvement initiatives designed to prioritize resource allocation, reduce costs, and drive profitability for the Company on a global basis.

The transition associated with the suspension of the APC business which has taken place through March 31, 2025 includes staff rationalization and reduction, supplier and partner engagement, and the monetization of certain assets.

The transition associated with the suspension of the APC business which has taken place through June 30, 2025 includes staff rationalization and reduction, supplier and partner engagement, and the monetization of certain assets.

The remaining transition activities include the execution of the activities to satisfy the requirements for the remaining APC projects in China (with a backlog totaling approximately $ 3 ) and those related to subsidiary closure.

The following table presents our revenues and net loss for the three months ended March 31, 2025 and 2024 in China as follows:

The following table presents our revenues and net loss for the three and six months ended June 30, 2025 and 2024 in China as follows:

Three Months Ended

Six Months Ended

Total revenues

$ — $ — $ — $ —

The following table presents net assets in China as of March 31, 2025 and December 31, 2024 :

March 31, 2025

( 12 ) ( 15 ) ( 30 ) ( 28 )

The following table presents net assets in China as of June 30, 2025 and December 31, 2024 :

June 30, 2025

December 31, 2024

6 unchanged sentences

Three Months Ended

Six Months Ended

Foreign currency translation

Balance at beginning of period

$ ( 1,915 ) $ ( 1,748 )

Other comprehensive income (loss):

1 unchanged sentence

Total accumulated other comprehensive loss

$ ( 1,780 ) $ ( 1,891 )

In all periods presented, there were no tax impacts related to rate changes and no amounts were reclassified to earnings.

Treasury Stock

Common stock held in treasury totaled 1,083,399 and 1,059,056 with a cost of $ 2,370 and $ 2,346 at March 31, 2025 and December 31, 2024 , respectively.

Common stock held in treasury totaled 1,206,741 and 1,059,056 with a cost of $ 2,568 and $ 2,346 at June 30, 2025 and December 31, 2024 , respectively.

These shares were withheld from employees to settle personal tax withholding obligations that arose as a result of restricted stock units that vested.

3 unchanged sentences

Out-of-money stock options and warrants are excluded from diluted earnings per share because they are unlikely to be exercised and would be anti- dilutive if they were exercised.

For the three months ended March 31, 2025 , basic earnings per share is equal to diluted earnings per share because all outstanding stock awards, warrants, and convertible loan notes are considered anti-dilutive during periods of net loss.

For the three months ended March 31, 2024 , basic earnings per share has been adjusted to include dilutive options and RSUs.

The following table sets forth the weighted-average shares used in calculating the earnings per share for the three months ended March 31, 2025 and 2024 :

For the three and six months ended June 30, 2025 and 2024 , basic earnings per share is equal to diluted earnings per share because all outstanding stock awards, warrants, and convertible loan notes are considered anti-dilutive during periods of net loss.

The following table sets forth the weighted-average shares used in calculating the earnings per share for the three and six months ended June 30, 2025 and 2024 :

Three Months Ended

Six Months Ended

Basic weighted-average shares

3 unchanged sentences

30,868,000 30,482,000 30,796,000 30,434,000

For the three months ended March 31, 2025 and 2024 , Fuel Tech had weighted-average outstanding equity awards of 135,900 and 263,800 , respectively, and warrants of 2,850,000 in both periods, which were antidilutive or represent out-of-the-money options for the purpose of the calculation of diluted earnings per share.

For the three months ended March 31, 2025 , Fuel Tech had 322,700 incremental equity awards that were excluded from the computation of diluted earnings per share as the inclusion of such would have been anti-dilutive due to a net loss in the period.

For the three and six months ended June 30, 2025 , Fuel Tech had weighted-average outstanding equity awards of 36,800 and 71,300 , respectively, and warrants of 2,850,000 in both periods, which were antidilutive or represent out-of-the-money options for the purpose of the calculation of diluted earnings per share.

For the three and six months ended June 30, 2025 , Fuel Tech had incremental equity awards of 316,100 and 467,100 , respectively, that were excluded from the computation of diluted earnings per share as the inclusion of such would have been anti-dilutive due to a net loss in the period.

These equity awards could potentially dilute basic earnings per share in future years.

For the three and six months ended June 30, 2024 , Fuel Tech had weighted-average outstanding equity awards of 198,400 and 284,100 , respectively, and warrants of 2,850,000 in both periods, which were antidilutive or represent out-of-the-money options for the purpose of the calculation of diluted earnings per share.

For the three and six months ended June 30, 2024 , Fuel Tech had incremental equity awards of 802,000 and 933,400 , respectively, that were excluded from the computation of diluted earnings per share as the inclusion of such would have been anti-dilutive due to a net loss in the period.

These equity awards could potentially dilute basic earnings per share in future years.

Stock-Based Compensation

5 unchanged sentences

There are a maximum of 2,883,057 shares that may be issued or reserved for awards to participants under the Incentive Plans.

As of March 31, 2025 , Fuel Tech had 2,485,543 shares available for issuance under the Incentive Plans.

We did not record any excess tax benefits within income tax expense for the three months ended March 31, 2025 and 2024 .

Given the Company has a full valuation allowance on its deferred tax assets, there were no excess tax benefits to record for the three months ended March 31, 2025 and 2024 .

As of June 30, 2025 , Fuel Tech had 2,668,885 shares available for issuance under the Incentive Plans.

We did not record any excess tax benefits within income tax expense for the three and six months ended June 30, 2025 and 2024 .

Given the Company has a full valuation allowance on its deferred tax assets, there were no excess tax benefits to record for the three and six months ended June 30, 2025 and 2024 .

In addition, we account for forfeitures of awards based on an estimate of the number of awards expected to be forfeited and adjust the estimate when it is no longer probable that the employee will fulfill the service condition.

Stock-based compensation is included in selling, general, and administrative costs in our Condensed Consolidated Statements of Operations.

The components of stock-based compensation for the three months ended March 31, 2025 and 2024 were as follows:

The components of stock-based compensation for the three and six months ended June 30, 2025 and 2024 were as follows:

Three Months Ended

Six Months Ended

Stock options and restricted stock units, net of forfeitures

$ 102 $ 124 $ 212 $ 228

After-tax effect of stock-based compensation

$ 102 $ 124 $ 212 $ 228

Stock Options

9 unchanged sentences

and ( 3 ) expected life of the option – an estimate based on historical experience including the effect of employee terminations.

Stock option activity for Fuel Tech’s Incentive Plans for the three months ended March 31, 2025 was as follows:

Stock option activity for Fuel Tech’s Incentive Plans for the six months ended June 30, 2025 was as follows:

Weighted- Average

3 unchanged sentences

Expired or forfeited

Outstanding on March 31, 2025

( 105,000 ) 2.44

Exercisable on March 31, 2025

Outstanding on June 30, 2025

71,000 $ 1.20 0.84 $ 2

As of March 31, 2025 , there was no unrecognized compensation cost related to non-vested stock options granted under the Incentive Plans.

Exercisable on June 30, 2025

71,000 $ 1.20 0.84 $ 2

As of June 30, 2025 , there was no unrecognized compensation cost related to non-vested stock options granted under the Incentive Plans.

Restricted Stock Units

10 unchanged sentences

All RSUs are valued at the date of grant based on the closing price of the Company’s common stock on the grant date.

At March 31, 2025 , there is $ 1,149 of unrecognized compensation cost related to all non-vested share-based compensation arrangements granted under the Incentive Plan.

At June 30, 2025 , there is $ 1,121 of unrecognized compensation cost related to all non-vested share-based compensation arrangements granted under the Incentive Plan.

That cost is expected to be recognized over the remaining requisite service period of 2.08 yea rs.

A summary of restricted stock unit activity for the three months ended March 31, 2025 is as follows:

A summary of restricted stock unit activity for the six months ended June 30, 2025 is as follows:

Weighted Average

3 unchanged sentences

( 425,100 ) 1.27

Unvested restricted stock units at March 31, 2025

Unvested restricted stock units at June 30, 2025

1,109,222 $ 1.06

The fair value of restricted stock that vested during the three -month period ended March 31, 2025 was $ 101 .

The fair value of restricted stock that vested during the six -month period ended June 30, 2025 was $ 654 .

Deferred Directors Fees

2 unchanged sentences

In accordance with Accounting Standards Codification (ASC) 718, Fuel Tech accounts for these awards as equity awards as opposed to liability awards.

During the three -month periods ended March 31, 2025 and 2024 , Fuel Tech recorded no stock-based compensation expense under the Deferred Plan.

The following table summarizes information about warrants outstanding and exercisable at March 31, 2025 :

Exercise Price Number Outstanding/Exercisable Weighted Average Remaining Life in Years Weighted Average Exercise Price

$ 5.10 2,500,000 1.37 $ 5.10

$ 6.45 350,000 1.37 $ 6.45

During the six -month periods ended June 30, 2025 and 2024 , Fuel Tech recorded no stock-based compensation expense under the Deferred Plan.

The following table summarizes information about warrants outstanding and exercisable at June 30, 2025 :

Exercise Price

Number Outstanding/Exercisable

Weighted Average Remaining Life in Years

Weighted Average Exercise Price

Debt Financing

2 unchanged sentences

There are no financial covenants set forth in the Investment Collateral Security agreement.

At March 31, 2025 , the Company had outstanding standby letters of credit totaling approximately $ 2,124 under the Investment Collateral Security agreement.

At March 31, 2025 , the investments held as collateral totaled $ 3,186 .

At June 30, 2025 , the Company had outstanding standby letters of credit totaling approximately $ 2,923 under the Investment Collateral Security agreement.

At June 30, 2025 , the investments held as collateral totaled $ 4,385 .

Fuel Tech is committed to reimbursing the issuing bank for any payments made by the bank under these instruments.

19 unchanged sentences

Air Pollution

Three months ended March 31, 2025

Three months ended June 30, 2025

Control Segment

11 unchanged sentences

Air Pollution

Three months ended March 31, 2024

Three months ended June 30, 2024

Control Segment

10 unchanged sentences

$ 1,544 $ 1,408 $ ( 3,667 ) $ ( 715 )

Air Pollution

Six months ended June 30, 2025

Control Segment

Revenues from external customers

$ 3,808 $ 8,132 $ — $ 11,940

Cost of sales

( 2,284 ) ( 4,168 ) — ( 6,452 )

1,524 3,964 — 5,488

Selling, general and administrative

— — ( 6,688 ) ( 6,688 )

Research and development

— — ( 1,060 ) ( 1,060 )

Operating income (loss) from operations

$ 1,524 $ 3,964 $ ( 7,748 ) $ ( 2,260 )

Air Pollution

Six months ended June 30, 2024

Control Segment

Revenues from external customers

$ 6,267 $ 5,732 $ — $ 11,999

Cost of sales

( 3,833 ) ( 3,185 ) — ( 7,018 )

2,434 2,547 — 4,981

Selling, general and administrative

— — ( 6,590 ) ( 6,590 )

Research and development

— — ( 798 ) ( 798 )

Operating income (loss) from operations

$ 2,434 $ 2,547 $ ( 7,388 ) $ ( 2,407 )

Geographic Segment Financial Data

3 unchanged sentences

Three Months Ended

Six Months Ended

United States

1 unchanged sentence

1,116 2,571 2,139 3,933

$ 5,558 $ 7,042 $ 11,940 $ 11,999

United States

3 unchanged sentences

The components of other accrued liabilities are as follows:

March 31, 2025

June 30, 2025

December 31, 2024

Contract liabilities (Note 3)

$ 1,683 $ 721

Deferred revenue

15 unchanged sentences

This approach provides an aggregate warranty accrual that is historically aligned with actual warranty claims experienced.

There was no change in the warranty liability balance included in the other accrued liabilities line of the Condensed Consolidated Balance Sheets during the three months ended March 31, 2025 and 2024 .

The warranty liability balance was $ 159 at March 31, 2025 and December 31, 2024 .

The Company’s effective tax rate is approximately 0.0 % and 3.8 % for the three -month periods ended March 31, 2025 and 2024 , respectively.

The Company's effective tax rate differs from the statutory federal tax rate of 21 % for the three -month periods ended March 31, 2025 and 2024 primarily due to a full valuation allowance recorded on our United States, China and Italy deferred tax assets since we cannot anticipate when or if we will have sufficient taxable income to utilize the deferred tax assets in the future.

There was no change in the warranty liability balance included in the other accrued liabilities line of the Condensed Consolidated Balance Sheets during the six months ended June 30, 2025 and 2024 .

The warranty liability balance was $ 159 at June 30, 2025 and December 31, 2024 .

The Company’s effective tax rate is approximately 0.3 % and 13.8 % for the six -month periods ended June 30, 2025 and 2024 , respectively.

The Company's effective tax rate differs from the statutory federal tax rate of 21 % for the six -month periods ended June 30, 2025 and 2024 primarily due to a full valuation allowance recorded on our United States, China and Italy deferred tax assets since we cannot anticipate when or if we will have sufficient taxable income to utilize the deferred tax assets in the future.

Further, our effective tax rate differs from the statutory federal tax rate due to state taxes, differences between U.S.

and foreign tax rates, foreign losses incurred with no related tax benefit, non-deductible commissions, and non-deductible meals and entertainment expenses for the three -month periods ended March 31, 2025 and 2024 .

and foreign tax rates, foreign losses incurred with no related tax benefit, non-deductible commissions, and non-deductible meals and entertainment expenses for the six -month periods ended June 30, 2025 and 2024 .

On July 4, 2025, the One Big Beautiful Bill Act was signed into law.

This act includes changes to the U.S.

corporate income tax system.

The Company is currently evaluating the full effect of the legislation, but does not expect it to have a material impact on our Consolidated Financial Statements.

FUEL TECH, INC.

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.

What changed 10-Q

Item 1. Financial Statements