Fluence (FLC) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue was $30.3M, down 28% year-over-year due to Ivory Coast project delays and China market weakness; core business revenue grew 11% excluding Ivory Coast impact.

• SPS and recurring revenue reached $29.1M YTD Q3 2024, up 13% year-over-year, now representing a larger share of total revenue.

• Gross margin improved to 31.8% YTD Q3 2024, up 5.5 percentage points from the prior year.

• Backlog at Q3 2024 was $101.8M, with $70.2M expected to be recognized in the next 12 months (+39% from Q4 2023).

• Leadership team with over 100 years' industry experience joined in the last 2-3 years, driving a strategic turnaround and operational realignment.

Financial highlights

• YTD Q3 2024 revenue from Ivory Coast was $1.0M, down from $15.9M in YTD Q3 2023.

• EBITDA loss YTD 2024 was $5.1M, with full-year guidance revised to a loss of $3.5–$4.5M.

• SG&A and R&D costs reduced by $3.1M (20%) YTD Q3 2024; expected to finish 2024 about $6M lower than 2022.

• Cash at quarter-end was $4.9M, with $7.5M in deposits as of September 30, 2024.

• Operating cash flow was negative in Q3 2024, mainly due to project delays and debt repayment.

Outlook and guidance

• FY2024 revenue guidance revised to $50–$60M, with significant Q4 revenue and cash flow expected as the Ivory Coast Addendum progresses.

• FY2024 EBITDA loss expected at $3.5–$4.5M, revised from previous guidance of breakeven.

• H2 2024 operating cash flow forecasted to be positive, especially in Q4.

• Projecting $50–$60M in new order bookings in H2 2024.

• Management confident in a strong and profitable 2025.