Eos Energy Enterprises — Third Quarter 2026 Earnings Summary

Financial Performance:

• Revenue totaled $82.7 million for the quarter, a 171% increase year-over-year and 20% increase sequentially.
• Gross margin improved to negative 53%, an increase of 58 percentage points year-over-year and 18 percentage points sequentially; gross loss was $44.2 million compared to $33.9 million in the prior year period.
• Adjusted gross margin improved to negative 44%, with adjusted gross loss improving $6.1 million sequentially to $36.8 million.
• Adjusted EBITDA margin was negative 77%, improving 96 percentage points year-over-year and 27 percentage points sequentially; adjusted EBITDA loss was $63.8 million, down from $71.4 million in the prior quarter.
• Net income attributable to shareholders was $125.0 million, primarily driven by non-cash mark-to-market gains on warrants and debt.
• Total cash and restricted cash stood at $344.1 million as of September 30, 2026.
• Backlog was $765 million (representing 3.2 GWh), up 19% year-over-year but down 5% from the prior quarter.
• Nine-month revenue was $208.5 million, compared to $56.2 million in the same period of 2025.
• Nine-month adjusted EBITDA loss was $203.2 million, compared to $147.6 million in the prior year period.

Guidance and Future Outlook:

• Reaffirmed full-year 2026 revenue outlook in the lower half of the $300 million to $350 million range.
• Manufacturing consolidation into the Thorn Hill facility began in late October, expected to temporarily impact fourth-quarter capacity and shipment timing.
• Line 1 disassembly at Turtle Creek began in late October, with full line production expected to resume near the end of Q1 2027 with upgraded capabilities.
• Upon completion of consolidation, Thorn Hill is expected to have approximately 4 GWh of annual nameplate capacity across two production lines.
• The strategic move is expected to accelerate the realization of a lower-cost, single-site manufacturing footprint and associated operating efficiencies in 2027.

Business Segments and Product Lines:

• Delivered record revenue through shipments to 10 projects.
• Cube shipments increased 216% year-over-year and 23% sequentially.
• Cumulative energy discharged from Eos technology reached 6.9 GWh, up nearly 400 MWh sequentially.
• Line 2 reached first-pass yield parity with Line 1 within three months of operation and contributed 17% of total battery output, up from approximately 1% in the second quarter.
• Line 2 delivered approximately 20% higher battery output per shift than Line 1.
• Announced a project with MN8 Energy to deliver 10 MW/100 MWh of Z3™ zinc-based LDES in West Virginia, serving Google's data centers.
• Booked six orders from four new customers and two existing customers during the quarter.
• Commercial opportunity pipeline totaled $24.9 billion.

Market and Competitive Landscape:

• Demand continued across commercial and industrial (C&I) and data center markets.
• The company positions its Znyth™ technology as a safe, non-flammable, secure, stable, and scalable alternative to conventional technology for long-duration energy storage.
• The company is the leading innovator in designing, manufacturing, and providing zinc-based LDES systems sourced and manufactured in the United States.

Risks and Challenges:

• Manufacturing consolidation and the transition to Thorn Hill are expected to temporarily impact production capacity and the timing of certain shipments.
• Risks include the ability to forecast trends accurately, generate cash, service indebtedness, and raise future financing.
• Potential risks involve the successful execution of manufacturing consolidation, Line 1 disassembly, relocation, recommissioning, and ramp-up.
• Risks include the ability of customers to secure project financing and the availability of final tax credits under the Inflation Reduction Act.
• Risks associated with the Department of Energy Loan Facility timing and availability, as well as potential default or dilution risks related to the credit agreement with Cerberus.
• Risks related to supply chain disruptions, geopolitical conflict, and evolving energy policies.

Management Commentary and Tone:

• CEO Joe Mastrangelo stated the third quarter showed operating model improvement, delivering the highest quarterly revenue and improving gross margin by 18 points sequentially.
• Management noted that Line 2 achieved first-pass yield parity with Line 1 four times faster than previous benchmarks.
• The CEO indicated that while the transition to Thorn Hill lowers fourth-quarter capacity, it positions the company to reduce cost per cube and improve manufacturing efficiency in future quarters.
• Management expressed confidence in remaining on track to achieve the lower half of the full-year revenue outlook.

Other Key Points:

• Received $87 million as the first advance under the second tranche of the U.S. Department of Energy loan.
• A previously announced $100 million purchase order converted under an existing capacity reservation agreement but did not contribute to quarter-over-quarter backlog growth.
• The company operates two manufacturing lines: Line 1 at Turtle Creek and Line 2 at Thorn Hill, with operations consolidating into the single-site Thorn Hill facility.
• The company reported a backlog of $765 million representing 3.2 GWh as of September 30, 2026.