Fuel cell and electrolyzer manufacturer Bloom Energy reported revenue of $330.4 million in the third quarter (Q3) of 2024, down 17.46% year-over-year (YoY) from $400.3 million in Q3 2023, missing analyst expectations by $52.79 million.

The company posted an earnings per share (EPS) of $0.06, missing estimates by $0.09. The decrease is attributed to the inherent variability in Bloom’s project-based business model.

The company’s gross profit rose significantly to $78.7 million in Q3 2024, up from a gross loss of $5.2 million in the same quarter last year. This resulted in a substantial YoY increase in gross margin, which reached 23.8% this quarter, a 25.1% improvement from a negative 1.3% gross margin in Q3 2023. On a non-GAAP basis, Bloom’s gross margin stood at 25.2% in Q3, down from 31.6% a year earlier.

Bloom reported an operating loss of $9.7 million in Q3 2024, a marked YoY improvement from an operating loss of $103.7 million. The operating margin improved to -2.9% from -25.9% in the same period last year. Non-GAAP operating profit was $8.1 million, down from $51.8 million.

Bloom posted a net loss attributable to common stockholders of $14.7 million for Q3, from a net loss of $169 million last year.

The company’s adjusted EBITDA was $21.3 million, a decrease from $66.4 million in the corresponding period last year. This decrease reflects the impact of lower revenue in this quarter.

The company’s quarterly revenues are atypical due to dependency on the timing of large project executions, leading to fluctuations in financial performance. The timing of large data center deals is uncertain, and complex negotiations cause delays in finalizing agreements.

Bloom announced an 80 MW fuel cell installation project in collaboration with SK Ecoplant. The project aims to start commercial operations in 2025.

The company also reported additional orders from Quanta.

Bloom reaffirmed its full-year 2024 financial guidance, maintaining its previous projections. The company expects revenue to be between $1.4 billion and $1.6 billion, supported by ongoing project execution and strategic partnerships.

It anticipates a non-GAAP gross margin of approximately 28%, aligning with its focus on margin improvement and cost efficiency. Non-GAAP operating income is projected to fall between $75 million and $100 million.

One of the quarter’s key highlights was the U.S. Department of Energy announcement that Bloom had been selected to negotiate a $50 million grant for a project to enable the continuous production of sulfide-based solid electrolyte materials for advanced all-solid-state batteries (ASSBs).

The company is expanding in the data center market. Its fuel cell systems are purpose-built for AI data centers, offering advantages like high power density and the ability to switch to hydrogen.

During an earnings call, K R Sridhar, Chairman and CEO, said transmission was a critical aspect of the energy business. The company has been partnering with utilities to complement transmission solutions and remove bottlenecks for its customers. “The recent FERC ruling highlights the consensus on the need for large-scale interconnections through new capacity additions. Utilities that adopt this model will likely find it easy to get their projects approved by regulators.”

Power shortages globally are an opportunity for the company as their solutions can help utilities mitigate long transmission cycles. The company expects more diversity in geography, customers, and sectors, making its business less prone to market cycles.

In the coming 12 to 18 months, Bloom plans to establish a pilot line capable of continuously manufacturing sulfide-based cell and electrolyte materials for ASSBs. The company has secured multiple partnerships within Korea’s robust materials and battery ecosystem to support this.

Bloom Energy recorded a revenue of $335.76 million in the second quarter of 2024, an 11.5% YoY growth from $301.09 million due to increased interest in the company’s products and solutions.