Unfortunately for nanotech fans, the jury's still out on whether Altair Nanotechnologies (NASDAQ:ALTI) is the real deal or merely a nano-pretender.

On Friday, the firm released a slew of press, the meatiest bit of which described its Q2 2005 financial results. No surprise, the suggested headline -- picked up by editors who aren't paying that much attention -- was a 226% year-over-year increase in revenues.

I prefer to look to the bottom line, which was slightly less gruesome than in the prior-year period. But let's start at the top. That big percentage gain needs to be examined a bit more closely. First off, the total at the top is only $503,000 -- and we all know that it's not too tough to post big increases when you're starting from such small numbers. Next, the vast majority of that amount comes by way of "contracts and grants," not product sales or other project collaborations.

Moving further down, we see that operating expenses increased by almost 12% to $2.55 million. Offset by a bit of interest income -- on cash raised from a recent placement -- the bottom-line loss totaled $1.9 million, down slightly from the prior-year-quarter's $2.15 million. Mark the calendar, folks. I'll give it up for Altair: A smaller loss is better than nothing.

But that's about as sanguine as I can be. I won't dwell on my past criticisms of Altair, suffice to say that I don't think investors should make too much of the continuing cycle of press releases touting the relationship with Advanced Battery (OTC BB: ABAT). It's tough to see too much to brag about in a metric ton of battery testing material for an undercapitalized Chinese partner that's working on batteries for electric cars.

Altair's other planned revenue generators -- a nano TiO2 pigment process, a relationship with Spectrum Pharmaceutical (NASDAQ:SPPI) for a drug to compete with Genzyme's (NASDAQ:GENZ) Renagel, products for HVAC and pool filtration -- are still in their infancy and don't seem to support the firm's market cap.

That said, with $30 million in the bank -- raised in the wake of a PR-initiated stock spike -- and a manageable burn rate, Altair's not in danger of disappearing, at least not immediately. Investors just need to realize that this is an unproven speculation with a history of hype. Bid on the shares accordingly, if at all.

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Seth Jayson watches the nanospace, but at the time of publication, he had positions in no company mentioned. View his stock holdings and Fool profile here. Fool rules are here.