ESS Tech (GWH 1.18%), a company known for its iron flow long-duration energy storage batteries, released earnings for the second quarter of fiscal 2025 on August 14, 2025. The headline from the release was a significant increase in GAAP revenue, reaching $2.4 million and met analyst consensus. Although the company’s GAAP net loss narrowed sharply year over year, liquidity remains a top concern, with a period-end cash balance of just $0.8 million despite recent capital-raising moves. The quarter showed real operational progress and commercial traction.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS | $(0.90) | $(1.08) | $(1.87) | 52.0% |
| Revenue | $2.4 million | $2.4 million | N/A | N/A |
| Adjusted EBITDA | $(7.8 million) | $(18.8 million) | 58.6% | |
| Cash and Cash Equivalents (quarter-end) | $0.8 million | $36.7 million | (97.8%) |
Source: Analyst estimates for the quarter provided by FactSet.
What ESS Tech Does and Where It’s Focused
ESS Tech designs and manufactures iron flow batteries for use in long-duration energy storage. These batteries are made to address the needs of renewable energy projects and modernize the electric grid, offering an alternative to lithium-ion batteries. The company’s flagship products use abundant materials, long-lasting components, and a proprietary Proton Pump which enables over 20,000 charge cycles without loss of performance.
Since its founding, ESS Tech has focused on making its technology more competitive with established battery types by cutting manufacturing costs and building partnerships that provide customers with financial guarantees. The business sees long-duration storage—energy storage for periods longer than eight hours—as the largest area where it can stand out. To support market adoption, ESS Tech collaborates with insurers and development banks to ensure reliability, performance, and strong incentives for buyers.
Quarter Highlights: What Happened and What Drove the Numbers
The second quarter saw a major milestone: the first sale of the new Energy Base iron flow battery platform, a product aimed at utility- and grid-scale storage needs. While sales are still early-stage, ESS Tech reported closing this initial project and entering into new contracts for further Energy Base deployments. Proposal activity remained high, with over 1.1 gigawatt hours (GWh) of projects submitted—an indicator of rising market interest even if actual order conversion is still developing.
Financial results showed GAAP revenue was nearly seven times higher than in Q2 2024, reflecting the first direct sales impact of the new Energy Base system. At the same time, cost cuts were significant. GAAP operating expenses dropped by 35% quarter-over-quarter, and adjusted EBITDA (non-GAAP) loss improved by 49% compared to Q1 2025. The company also highlighted an approximately 80% reduction in operating cash burn in June 2025 compared to the monthly average for the first five months of the year, showing early results of renewed cost discipline and efficiency efforts.
Margins remained a challenge: GAAP costs to produce and deliver the batteries were still more than three times total GAAP revenue, leading to a gross loss for the quarter. This outcome points to the typical early-stage hurdles of ramping up a new manufacturing process—especially as economies of scale have not yet been fully realized. ESS Tech’s management noted that GAAP cost of revenue fell 15% from Q1 2025, but acknowledged gross loss remains large in absolute terms. No material one-time charges or events were declared, with no new dividend initiated or changed this period.
The financial position at the period’s close was a key storyline. GAAP cash on hand finished at only $0.8 million. The company responded by raising up to $31 million in new capital, including an immediate cash infusion and a $25 million Standby Equity Purchase Agreement in July 2025. This deal allows ESS Tech to sell shares as needed to meet liquidity needs, though this form of financing may lead to shareholder dilution. There were no declared changes to issued or planned dividends—the company does not currently pay a dividend. Newly appointed leaders joined the executive team, including a Chief Operating Officer and interim Chief Financial Officer, signaling a focus on operational stability and driving performance toward profitability.
Looking Ahead: Guidance and Areas to Watch
ESS Tech did not provide specific forward guidance for revenue or profit in the next quarter or for all of fiscal 2025. The company signaled continued investment in commercialization and operational discipline. Leadership plans to focus on converting its robust proposal pipeline into signed contracts, while maintaining cost-cutting strategies wherever possible.
With liquidity concerns still present, investors will likely pay close attention to GWH, which does not currently pay a dividend.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
