374Water (SCWO) Q2 2024 earnings summary

Executive summary

• Advanced AirSCWO technology toward commercialization, with deployments and demonstrations in Orlando for biosolids and PFAS destruction, and expansion of manufacturing and lab capacity.

• New executive leadership, including a Chief Administrative Officer and General Counsel, was appointed to strengthen management and drive commercialization.

• Focused on fulfilling municipal and federal contracts, expanding market opportunities, and building additional AirSCWO units for demonstrations and commercialization.

• Substantial net losses are expected to continue until successful commercialization and market adoption of AirSCWO systems.

Financial highlights

• Q2 2024 revenue was $36,821–$37,000, down 26% year-over-year; six-month revenue was $352,000–$352,099, down 59% from 2023.

• Operating expenses rose to $4.9 million in H1 2024 from $3.5 million in H1 2023, mainly due to higher R&D, G&A, and non-recurring professional fees.

• Net loss for Q2 2024 was $2.93 million, and for H1 2024 was $4.96 million, both up significantly year-over-year.

• Gross margin turned negative in H1 2024 at -$308,742.

• Cash at June 30, 2024 was $5.1 million, down from $10.4 million at year-end 2023.

Outlook and guidance

• Management expects continued substantial losses and negative cash flows until AirSCWO systems are commercialized, with additional debt or equity financing required to fund operations for at least the next twelve months.

• Plans to commercialize AirSCWO within 12–18 months, with additional units under construction and design.

• Ongoing demonstrations in Orlando and Orange County expected to drive demand for larger AS30 and AS100 units, with funding already secured for initial AS30s.

• Exploring additional revenue streams from lab-based treatability studies and destruction-as-a-service partnerships.

• Company estimates global market opportunity for its technology in the hundreds of billions of dollars.