# FTC Solar, Inc.: Form 10-Q for the period ended Jun 30, 2025

- Company: [FTC Solar, Inc.](/companies/ftci.md) (CIK 1828161)
- Form: 10-Q
- Filed: 2025-08-05
- Accepted by EDGAR: Aug 5, 2025, 13:15 ET
- Period: 2025-06-30
- Accession: 0000950170-25-102455
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/1828161/000095017025102455/ftci-20250630.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1828161/000095017025102455/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2025-06-30.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2025-04-01 to 2025-06-30 | $20.0m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Revenue | 6 months, 2025-01-01 to 2025-06-30 | $40.8m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Cost of revenue | 3 months, 2025-04-01 to 2025-06-30 | $23.9m | us-gaap:CostOfGoodsAndServicesSold |
| Cost of revenue | 6 months, 2025-01-01 to 2025-06-30 | $48.2m | us-gaap:CostOfGoodsAndServicesSold |
| Gross profit | 3 months, 2025-04-01 to 2025-06-30 | −$3.9m | us-gaap:GrossProfit |
| Gross profit | 6 months, 2025-01-01 to 2025-06-30 | −$7.4m | us-gaap:GrossProfit |
| Research and development | 3 months, 2025-04-01 to 2025-06-30 | $1.1m | us-gaap:ResearchAndDevelopmentExpense |
| Research and development | 6 months, 2025-01-01 to 2025-06-30 | $2.1m | us-gaap:ResearchAndDevelopmentExpense |
| Operating income | 3 months, 2025-04-01 to 2025-06-30 | −$11.5m | us-gaap:OperatingIncomeLoss |
| Operating income | 6 months, 2025-01-01 to 2025-06-30 | −$22.1m | us-gaap:OperatingIncomeLoss |
| Interest expense | 3 months, 2025-04-01 to 2025-06-30 | $731.0k | us-gaap:InterestExpense |
| Interest expense | 6 months, 2025-01-01 to 2025-06-30 | $1.4m | us-gaap:InterestExpense |
| Income tax | 3 months, 2025-04-01 to 2025-06-30 | $39.0k | us-gaap:IncomeTaxExpenseBenefit |
| Income tax | 6 months, 2025-01-01 to 2025-06-30 | $293.0k | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2025-04-01 to 2025-06-30 | −$15.4m | us-gaap:NetIncomeLoss |
| Net income | 6 months, 2025-01-01 to 2025-06-30 | −$19.2m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2025-04-01 to 2025-06-30 | −$1.18 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 6 months, 2025-01-01 to 2025-06-30 | −$1.49 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2025-04-01 to 2025-06-30 | −$1.18 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 6 months, 2025-01-01 to 2025-06-30 | −$1.49 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2025-04-01 to 2025-06-30 | 13,098,825 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 6 months, 2025-01-01 to 2025-06-30 | 12,948,189 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 6 months, 2025-01-01 to 2025-06-30 | −$10.8m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 3 months, 2025-04-01 to 2025-06-30 | $185.0k | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Capital expenditure | 6 months, 2025-01-01 to 2025-06-30 | $268.0k | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Cash and equivalents | at 2025-06-30 | $3.5m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2025-06-30 | $70.3m | us-gaap:AssetsCurrent |
| Total assets | at 2025-06-30 | $83.0m | us-gaap:Assets |
| Current liabilities | at 2025-06-30 | $60.6m | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2025-06-30 | $73.9m | us-gaap:Liabilities |
| Long-term debt | at 2025-06-30 | $10.9m | us-gaap:LongTermDebt |
| Shareholders' equity | at 2025-06-30 | $9.0m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 82,708 characters.

*The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Condensed Consolidated Financial Statements and related notes included in Item 1 of this Form 10-Q and along with information included in our 2024 Annual Report. In addition to historical financial information, the following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from such forward-looking statements. Factors that could cause or contribute to those differences include, but are not limited to, those identified below and those discussed in Part I, Item 1A. "Risk Factors" included in our 2024 Annual Report. Additionally, our historical results are not necessarily indicative of the results that may be expected in any future period.*

*This discussion and analysis of our financial condition and results of operations contain the presentation of Adjusted EBITDA, Adjusted Net Loss and Adjusted EPS, which are not presented in accordance with U.S. GAAP. Adjusted EBITDA, Adjusted Net Loss and Adjusted EPS are being presented because they provide the Company and readers of this Form 10-Q with additional insight into our operational performance relative to earlier periods and relative to our competitors. We do not intend Adjusted EBITDA, Adjusted Net Loss and Adjusted EPS to be substitutes for any U.S. GAAP financial information. Readers of this Form 10-Q should use Adjusted EBITDA, Adjusted Net Loss and Adjusted EPS only in conjunction with Net Loss and Net Loss per Share, the most comparable U.S. GAAP financial measures. Reconciliations of Adjusted EBITDA, Adjusted Net Loss and Adjusted EPS to Net Loss and Net Loss per Share, the most comparable U.S. GAAP measures, are provided in "Non-GAAP Financial Measures" below.*

### Overview

FTC Solar, Inc. (the “Company”, “we”, “our”, or “us”) was founded in 2017 and is incorporated in the state of Delaware. In April 2021, we completed an initial public offering ("IPO"), and our common stock currently trades on the Nasdaq Capital Market ("Nasdaq") under the symbol “FTCI”.

We are a global provider of solar tracker systems, supported by proprietary software and value-added engineering services. Solar tracker systems move solar panels throughout the day to maintain an optimal orientation relative to the sun, thereby increasing the amount of solar energy produced at a solar installation. Our one module-in-portrait ("1P") solar tracker system is marketed under the Pioneer brand name ("Pioneer") and our original two modules-in-portrait ("2P") solar tracker system is marketed under the Voyager brand name (“Voyager”). We also have a mounting solution to support the installation and use of U.S.-manufactured thin-film modules. Our primary software offerings include SUNPATH, which helps customers optimize solar tracking for increased energy production, and our SUNOPS real-time operations management platform. In addition, we have a team of renewable energy professionals available to assist our U.S. and worldwide clients in site layout, structural design, pile testing and other needs across the solar project development and construction cycle. Our products and services provide tracker solutions for large utility-scale solar and distributed generation projects around the world. Our customers are primarily engineering, procurement and construction companies ("EPCs") and we also contract with developers and owners. The Company is headquartered in Austin, Texas, and has international subsidiaries in Australia, China, India, South Africa and Spain.

We are an emerging growth company, as defined in the Jumpstart Our Business Startups (JOBS) Act. Under the JOBS Act, we elected to use the allowed extended transition period to delay adopting new or revised accounting standards until such time as those standards apply to private companies.

### Key Factors Affecting Our Performance

***Project Timing.*** Our level of manufacturing and logistics activity, and thus our revenue, can be significantly impacted by delays or changes in the expected timing of customer project development activity. In recent periods our customers have encountered delays in beginning or continuing project development caused by interconnection issues, including permit delays, equipment shortages, obtaining project financing at acceptable levels and addressing uncertainty in changes in government regulations, as described further below. Due to our limited number of large customers, such delays in project development activity can have a material impact on our quarterly and annual consolidated financial results.

***Government Regulations.*** Changes in the U.S. trade environment, including the imposition of import tariffs, AD/CVD investigations and the UFLPA, which became effective in June 2022, can have an impact on the timing of developer projects. The UFLPA resulted in new rules for module importers and reviews by CBP. There continues to be some uncertainty in the market around achieving full compliance with UFLPA, whether related to sufficient traceability of materials or other factors. Escalating trade tensions, particularly between the United States and China, have led to increased tariffs and trade restrictions, including tariffs applicable to certain raw materials and components for our products. We have taken measures with the intention of mitigating the effect of tariffs and the impact of AD/CVD and UFLPA on our business by reducing our reliance on China and enhancing our U.S.-based supply chain, including through our investment in Alpha Steel, as described further in Note 9, "Equity method investment" in Part I, Item 1 of this Form 10-Q. In 2019, 90% of our supply chain was sourced from China. As of June 30, 2025, we have qualified suppliers outside of China for certain of our commodities and we continue to work to have second-source capability for all Chinese-manufactured components to help reduce the extent to which our supply chain for U.S.-based projects is subject to existing tariffs and to be able to quickly address potential future regulatory and governmental policy changes. We have entered into partnerships with manufacturers based in the United States, India, South Africa, Spain, Turkey, Thailand and Vietnam to diversify our supply chain and optimize costs. On June 6, 2022, President Biden issued an Executive Order allowing U.S. solar deployers to import solar modules and cells from Cambodia, Malaysia, Thailand and Vietnam free from certain duties for 24 months, along with other incentives designed to accelerate U.S. domestic production of clean energy technologies. This moratorium ended in June 2024 and anti-dumping and countervailing duties on solar products linked to China are now well in excess of 200% for certain countries where Chinese firms have relocated production. Additionally, on December 29, 2023, Auxin and Concept Clean Energy, Inc. filed suit in the U.S. Court of International Trade challenging the legal basis for the moratorium and implementing regulations. Several motions have been filed to date, including a motion to dismiss by the U.S. government, which the court rejected. If the suit proves successful, solar module importers could owe retroactive duties on goods that have already cleared customs.

Effective April 5, 2025, the United States imposed a universal 10% tariff on most imports into the United States, excluding certain trade agreements. Tariff rates continue to change and fluctuate as negotiations continue between the United States and various countries. As an example, the United States previously imposed a 145% tariff on goods imported from China, and China imposed a retaliatory 125% tariff on goods imported from the United States. In May 2025, the U.S. and China agreed to a 90-day rollback whereby the United States cut the Chinese levies from 145% to 30% and China lowered the duties on U.S. goods from 125% to 10%, effective May 14, 2025. Also, in May 2025, the Trump administration announced the doubling of steel and aluminum tariffs to 50%. New reciprocal tariffs have also been announced on selected countries that are well above the universal 10% tariff rate. As of the filing of this Quarterly Report, matters involving tariffs continue to evolve and change, including in some cases, implementation of temporary pauses on certain announced tariffs as negotiations on final trade deals occur. Depending on the terms of our existing contracts with customers, we may not in all cases be able to fully recover the increased cost for delivery of tracker systems currently being manufactured for our customers by our international vendors due to higher tariffs currently in place, which has and may continue to impact our expected profitability under certain contracts. Imposition of new or higher tariffs could also adversely affect the amount or timing of our future revenue, results of operations or cash flows.

The most notable incentive program impacting our U.S. business has historically been the ITC for solar energy projects, which allows taxpayers to offset their U.S. federal income tax liability by a certain percentage of their cost basis in solar energy systems placed in service for commercial use. The Inflation Reduction Act of 2022 ("IRA"), passed by the U.S. Congress and signed into law by then-President Biden on August 16, 2022, expanded and extended the tax credits and other tax benefits available to solar energy projects and the solar energy supply chain. U.S. manufacturers of specific solar components also became eligible to claim production tax credits under Section 45X of the Internal Revenue Code of 1986, as amended, which was established as part of the IRA and is a per-unit tax credit earned for each clean energy component manufactured domestically and sold by a manufacturer. Our investment in, and commitments made to Alpha Steel allow us to obtain benefits of lower product costs from Alpha Steel as a result of the production tax credit program, subject to our level of purchases from Alpha Steel.

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act, which accelerates the phase-outs and terminations of various eligible tax credits enacted as part of the IRA and places restrictions on continued receipt of tax credits by specified foreign entities and foreign influenced entities. The reduction, elimination or expiration of government incentives for, or regulations mandating the use of, as well as corporate commitments to the use of renewable energy and solar energy specifically could reduce demand for solar energy systems and harm our business, financial condition and results of operations.

***Disruptions in Transportation and Supply Chain.*** Our costs are affected by the costs of certain components and materials, such as steel, motors and microchips, as well as tariffs and transportation costs. Current market conditions and international conflicts that constrain the supply of materials and disrupt the flow of materials from international vendors can impact the cost of our products and services, along with overall rates of inflation in the global economy and currently imposed tariff rates. We do not believe inflation has had a material impact on our results as presented in this report. However, such cost increases and decreases could impact our future operating margins, if material.

We have taken steps to expand and diversify our manufacturing partnerships and have adjusted our modes of transportation to mitigate the impact of headwinds that might arise in the global supply chain and logistics markets. We continue to monitor the logistics markets and will continue to evaluate our use of various modes of transportation when warranted to optimize our transportation costs. We also intend to maintain our focus on our design-to-value initiative to continue to improve margins by reducing the manufacturing and material costs of our products.

***Megawatts ("MW") Produced and MW Shipped and Average Selling Price ("ASP").*** The primary operating metrics we use to evaluate our sales performance and to track market acceptance of our products are the change in quantity of MW produced and MW shipped from period to period. MW are measured for each individual project and are calculated based on the expected output of that project once installed and fully operational. We also utilize metrics related to price and cost of goods sold per watt, including the change in ASP from period to period and cost per watt. ASP is calculated by dividing product and service revenue by total watts produced or shipped and product and service cost per watt is calculated by dividing product or service costs of revenue by total watts produced or shipped. These metrics enable us to evaluate trends in pricing, manufacturing and logistics costs and profitability. Events such as the COVID-19 pandemic, global inflation rates, tariffs, high interest rates and international conflicts have in the past impacted and may continue to impact the U.S. economy, global supply chains, and our business. These impacts can cause significant project development and shipping delays and cost increases, as well as offsetting ASP increases, and also raise the price of inputs like steel and logistics, affecting our cost per watt. Competitive tracker pricing pressures can also impact our ASP, and thus our profitability, by limiting our ability to raise prices to offset cost increases.

***Investment in Technology and Personnel.*** We invest in both the people and technology behind our products. We intend to continue making investments in the technology for our products and expansion of our patent portfolio to attract and retain customers, expand the capabilities and scope of our products, and enhance user experience. As an example, in August 2023, we introduced SUNOPS, a cloud-based solar asset monitoring solution, allowing asset owners and managers to evaluate the operation and performance of their solar deployments. Additionally, in May 2024, we announced the launch of our Automated Hail Stow Solution, aimed at minimizing solar panel damage caused by hailstorms. This solution integrates advanced technology with meteorological data to automatically adjust the positioning of solar panels, reducing the risk of hail-related damage. And, in April 2025, we unveiled dual-row configuration for our Pioneer tracker that allows for higher East-West slope tolerance, increased power density and installation on more challenging terrains while minimizing site preparation expense and environmental impact.

In addition, we intend over time to make additional investments to attract and retain employees in key positions, including sales leads, engineers, software developers, quality assurance personnel, supply chain personnel, product management, and operations personnel, to help us drive further efficiencies across our marketplace and, in the case of sales leads, to continue to enhance and diversify our sales capabilities, including international expansion.

***Impact of Climate Change.*** Climate change has primarily impacted our business operations by increasing demand for solar power generation and, as a result, for use of our products. The U.S. Energy Information Administration, in its July 2025 Short-Term Energy Outlook, estimates that solar generation of electricity this summer will increase in the United States by 34% from last summer and by summer 2026, will grow another 19% and surpass wind to become the leading source of renewables generation during the summer months of June through September.

While climate change has not resulted in any material negative impact to our operations to date, we recognize the risk of disruptions to our supply chain due to extreme weather events. This, among other things, has led us to expand the diversity of our supplier base and to partner with more local suppliers to reduce shipping and transportation needs. We are also increasingly partnering with larger scale steel producers rather than smaller suppliers to facilitate scaling of our operations while remaining conscious of the environmental impacts of steel manufacturing as the regulatory landscape around these high-emitting industries evolves. An example of this strategy is our investment in Alpha Steel, a U.S.-based manufacturing partnership with a leading steel fabricator.

We also attempt to mitigate the climate-related risks from the use of our products by designing our equipment and systems to have a high-slope tolerance and wind mitigation capabilities, while at the same time reducing the required foundation/pile count needed. This allows our trackers to be installed in increasingly hostile environments with minimal disturbance to the surrounding land.

***Liquidity.*** See "Liquidity and Capital Resources" below for a discussion of the impact of the items above on our liquidity position.

### Key Components of Our Results of Operations

The following discussion describes certain line items in our Condensed Consolidated Statements of Comprehensive Loss.

### Revenue

Revenue from the sale of our solar tracker systems and customized components of those systems is recognized over time, as work progresses, utilizing an input measure of progress determined by cost incurred to date relative to total expected cost on these projects to correlate with our performance in transferring control over the tracker systems and their components. Revenue from the sale of individual parts is recognized at a point in time as and when control transfers based on the terms of the contract. Revenue from sale of term-based software licenses is recognized upon transfer of control to the customer. Revenue for shipping and handling services is recognized over time based on progress in meeting shipping terms of the arrangements. Revenue for stand-alone engineering consulting and pile testing services is recognized at a point in time upon completion of the services performed. Subscription revenue, which is derived from our subscription-based enterprise licensing model, and support revenue, which is derived from ongoing security updates and maintenance, are generally recognized on a straight-line basis over the term of the contract.

Our customers include project developers, solar asset owners and EPCs that design and build solar energy projects. For each individual solar project, we enter into a contract with our customers covering the price, specifications, delivery dates and warranty for the products being purchased, among other things. Our contractual delivery period for our solar tracker systems and related parts can vary depending on the size of the project and availability of vessels and other means of delivery. Contracts can range in value from tens of thousands to tens of millions of dollars.

Our revenue is affected by changes in the volume and ASP of our solar tracking systems purchased by our customers and volume of sales of software products and engineering services, among other things. The ASP of our solar tracker systems and volume of sales is driven by the supply of, and demand for, our products, changes in product mix, geographic mix of our customers, strength of competitors’ product offerings, import tariffs and other import restrictions, supply chain issues and availability of government incentives to the end-users of our products. Additionally, our revenue may be impacted by seasonality due to cold weather, which can cause variability in site construction activity.

For the periods included in this Quarterly Report, no company locations other than those in the United States and Australia accounted for more than 10% of our consolidated revenue. Our revenue growth is dependent on continued growth in the number of solar tracker projects and engineering services we win in competitive bidding processes and growth in our software sales each year, as well as our ability to increase our market share in each of the geographies in which we currently compete, expand our global footprint to new emerging markets, grow our production capabilities to meet demand and continue to develop and introduce new and innovative products that address the changing technology and performance requirements of our customers, among other things.

### Cost of revenue and gross profit (loss)

We subcontract with third-party manufacturers to manufacture and deliver our products directly to our customers. Our product costs are affected by the underlying cost of raw materials procured by these contract manufacturers, including steel and aluminum; component costs, including electric motors and gearboxes; technological innovation in manufacturing processes; and our ability to achieve economies of scale resulting in lower component costs. We do not currently hedge against changes in the price of raw materials, but we continue to explore opportunities to mitigate the risks of foreign currency and commodity fluctuations through the use of hedges and foreign exchange lines of credit. Some of these costs, primarily for personnel, are not directly affected by sales volume.

Although we continue to add new employees in certain areas, we have reduced our total headcount over the last two years through adjustments made during the fourth quarter of 2024 and in August 2023, in response to project activity levels and process efficiencies we have gained due to our design-to-value and cost reduction efforts. Certain headcount changes also reflect a shift of our employee base to more cost-effective markets with exceptional talent. Our gross profit may vary period-to-period due to changes in our headcount, ASP, product costs, product versus service mix, customer mix, geographical mix, shipping methods, warranty costs and due to seasonal factors.

### Operating expenses

Operating expenses consist of research and development expenses, selling and marketing expenses and general and administrative expenses. Personnel-related costs are the most significant component of our operating expenses and include salaries, benefits, bonuses, commissions and stock-based compensation expenses.

Our operating costs have been impacted by (i) changes in headcount as described above, (ii) our level of research activities to originate, develop and enhance our products, (iii) our sales and marketing efforts as we expand our outreach to existing customers and seek to identify new opportunities domestically and internationally, (iv) changes in our estimates of credit losses relating to certain specific customers, and (v) variations in legal and professional fees, compliance costs, insurance, facility costs and other costs associated with strategic changes in response to changing market conditions and other matters.

### Results of Operations - Three Months Ended June 30, 2025 Compared to Three Months Ended June 30, 2024

*(in thousands, except percentages)*

| Revenue: | Three months ended June 30, 2025 Amounts | Percentage of revenue | 2024 Amounts | Percentage of revenue |
| --- | ---: | ---: | ---: | ---: |
| Product | $15,867 | 79.4% | $8,776 | 76.8% |
| Service | 4,126 | 20.6% | 2,654 | 23.2% |
| Total revenue | 19,993 | 100.0% | 11,430 | 100.0% |
| Cost of revenue: |  |  |  |  |
| Product | 18,876 | 94.4% | 10,467 | 91.6% |
| Service | 5,036 | 25.2% | 3,306 | 28.9% |
| Total cost of revenue | 23,912 | 119.6% | 13,773 | 120.5% |
| **Gross loss** | (3,919) | (19.6%) | (2,343) | (20.5%) |
| Operating expenses |  |  |  |  |
| Research and development | 1,129 | 5.6% | 1,535 | 13.4% |
| Selling and marketing | 1,291 | 6.5% | 2,036 | 17.8% |
| General and administrative | 5,160 | 25.8% | 6,010 | 52.6% |
| Total operating expenses | 7,580 | 37.9% | 9,581 | 83.8% |
| **Loss from operations** | (11,499) | (57.5%) | (11,924) | (104.3%) |
| Interest expense | (731) | (3.7%) | (117) | (1.0%) |
| Interest income | 5 | 0.0% | 118 | 1.0% |
| Gain on sale of Atlas | 50 | 0.3% | — | 0.0% |
| Loss from change in fair value of warrant liability | (2,836) | (14.2%) | — | 0.0% |
| Other income (expense), net | 71 | 0.4% | (7) | (0.1%) |
| Loss from unconsolidated subsidiary | (451) | (2.3%) | (246) | (2.2%) |
| **Loss before income taxes** | (15,391) | (77.0%) | (12,176) | (106.5%) |
| Provision for income taxes | (39) | (0.2%) | (65) | (0.6%) |
| **Net loss** | $(15,430) | (77.2%) | $(12,241) | (107.1%) |

### Revenue

We generate our revenue in two streams – Product revenue and Service revenue. Product revenue is derived from the sale of solar tracker systems and customized components for those systems, individual part sales for certain specific transactions and the sale of term-based software licenses. Service revenue includes revenue from shipping and handling services, engineering consulting and pile testing services, our subscription-based enterprise licensing model and maintenance and support services in connection with the term-based software licenses.

*(in thousands)*

|  | Three months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Product | $15,867 | $8,776 | $7,091 | 80.8% |
| Service | 4,126 | 2,654 | 1,472 | 55.5% |
| Total revenue | $19,993 | $11,430 | $8,563 | 74.9% |

### Product revenue

The increase in product revenue for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024, was primarily due to an increase of 147% in the amount of MW produced as activity has been positively impacted by recent project wins mainly associated with our 1P solar tracker solution. This was partially offset by a decrease of 27% in ASP for the three months ended June 30, 2025, resulting from project mix changes as compared to the three months ended June 30, 2024.

### Service revenue

The increase in service revenue for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024, primarily resulted from (i) an increase of 35% in logistics activity levels and (ii) an increase of 15% in ASP as compared to the three months ended June 30, 2024 as a result of project size and pricing. We also had higher engineering consulting revenue associated with new project activity during the three months ended June 30, 2025.

### Cost of revenue and gross loss

Cost of revenue consists primarily of costs related to raw materials, equipment manufacturing activities, net of incentives earned, freight and delivery, tariffs, product warranty, remediation and personnel costs (salaries, bonuses, benefits, and stock-based compensation). Personnel costs in cost of revenue include both direct labor costs, as well as costs attributable to any individuals whose activities relate to the procurement, installment and delivery of the finished product and services.

Gross loss may vary from period-to-period and is primarily affected by our ASP, product costs, timing of tracker production and delivery, customer mix, geographical mix, shipping method, logistics costs, warranty costs, indirect cost control efforts and seasonality.

*(in thousands)*

|  | Three months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Product | $18,876 | $10,467 | $8,409 | 80.3% |
| Service | 5,036 | 3,306 | 1,730 | 52.3% |
| Total cost of revenue | $23,912 | $13,773 | $10,139 | 73.6% |
| **Gross loss** | $(3,919) | $(2,343) | $(1,576) | (67.3)% |
| Gross loss percentage of revenue | (19.6%) | (20.5%) |  |  |

The increase in cost of revenue for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024, was primarily driven by (i) an increase of 147% in MW produced, (ii) additional costs associated with tariffs and specified minimum purchase commitments with Alpha Steel, a related party, and (iii) an increase of 35% in logistics activity levels. Costs associated with these increases in activity levels were partially offset by lower personnel costs from headcount reductions and lower warranty and remediation expenses.

Our gross margin percentage of revenue for the three months ended June 30, 2025 was a negative 19.6%, a slight improvement compared to a negative 20.5% for the three months ended June 30, 2024.

We had negative gross margin for the three months ended June 30, 2025 due to the impact of additional costs associated with tariffs and specified minimum purchase commitments referred to above. This was partially offset by higher revenues and indirect cost reductions, primarily due to lower personnel costs from headcount reductions and lower warranty and remediation expenses.

We had negative gross margin for the three months ended June 30, 2024 due to (i) the impact of lower revenue levels on our ability to cover certain overhead costs and (ii) insufficient service revenue to fully cover our warehousing costs.

### Research and development

Research and development expenses consist primarily of salaries, employee benefits, stock-based compensation expense and travel expense related to our engineers performing research and development activities to originate, develop and enhance our products. Additional expenses include consulting charges, component purchases and other costs for performing research and development on our software products.

*(in thousands)*

|  | Three months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Research and development | $1,129 | $1,535 | $(406) | (26.4%) |

The decrease in research and development expenses for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024, was primarily attributable to (i) lower payroll costs of $0.2 million, and (ii) lower professional service costs of $0.1 million resulting from cost reduction initiatives. Research and development expenses as a percentage of revenue were 5.6% for the three months ended June 30, 2025, as compared to 13.4% for the three months ended June 30, 2024.

### Selling and marketing

Selling and marketing expenses consist primarily of salaries, employee benefits, stock-based compensation expense and travel expense related to our sales and marketing and business development personnel. Additionally, selling and marketing expenses include costs associated with professional fees and support charges for software subscriptions and licenses, trade shows and conventions.

*(in thousands)*

|  | Three months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Selling and marketing | $1,291 | $2,036 | $(745) | (36.6%) |

The decrease in selling and marketing expenses for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024, was primarily attributable to (i) lower payroll costs of $0.6 million, (ii) lower marketing costs of $0.2 million, primarily associated with reduced spending for trade shows, (iii) lower professional services and stock-based compensation expense of $0.2 million and (iv) lower travel spending. This was partially offset by higher credit loss provisions of $0.4 million associated with certain specific customer accounts. Selling and marketing costs as a percentage of revenue were 6.5% for the three months ended June 30, 2025, compared to 17.8% for the three months ended June 30, 2024.

### General and administrative

General and administrative expenses consist primarily of salaries, employee benefits, stock-based compensation expense and travel expense related to our executives, finance team, and administrative employees. It also consists of legal, consulting, and professional fees, rent and lease expense pertaining to our headquarters and international offices, business insurance costs and certain other costs.

*(in thousands)*

|  | Three months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| General and administrative | $5,160 | $6,010 | $(850) | (14.1%) |

The decrease in general and administrative expenses for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024, was primarily attributable to (i) lower professional service costs of $0.3 million, (ii) lower stock-based compensation totaling $0.2 million, (iii) lower insurance costs of $0.2 million, (iv) lower intangible asset amortization expense of $0.1 million as such assets became fully amortized as of December 31, 2024, and (v) lower payroll and travel expenses. General and administrative expenses as a percentage of revenue were 25.8% for the three months ended June 30, 2025, compared to 52.6% for the three months ended June 30, 2024. The decrease in the percentage was largely attributable to the increased level of revenue during the three months ended June 30, 2025.

### Interest expense

*(in thousands)*

|  | Three months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Interest expense | $731 | $117 | $614 | 524.8% |

Interest expense incurred during the three months ended June 30, 2025 was primarily related to paid-in-kind interest added to the principal amount of our Senior Notes, as well as amortization of the discount and deferred loan costs on the Senior Notes. Interest expense during the three months ended June 30, 2024, primarily consisted of letter of credit and commitment fees on our Credit Facility that expired unused in April 2024, along with associated debt issue cost amortization.

### Gain on sale of Atlas

*(in thousands)*

|  | Three months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | --- |
| Gain on sale of Atlas | $50 | $— | $50 | N/A |

32

We sold our Atlas web-based software platform on December 2, 2024. In connection with the sale, the purchaser agreed to future potential earnout payments based on annual license renewals by certain existing customers during 2025. We received such a payment from the purchaser in June 2025. In accordance with our existing accounting policy, we recognize a gain from these contingent earnout payments upon receipt.

### Loss from change in fair value of warrant liability

*(in thousands)*

|  | Three months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | --- |
| Loss from change in fair value of warrant liability | $(2,836) | $— | $(2,836) | N/A |

The Original Warrants (as defined below under "Outstanding debt and warrants") issued in connection with the Offering described further in Note 12, "Debt" in our Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report, were classified as a long-term liability. Due largely to an increase in the price of our common stock during the three months ended June 30, 2025, the fair value of the Original Warrants increased from $4.9 million at March 31, 2025 to approximately $7.8 million when they were exercised in full on June 30, 2025, resulting in recognition of a non-cash loss for the increase in value during the three months ended June 30, 2025.

### Loss from unconsolidated subsidiary

*(in thousands)*

|  | Three months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Loss from unconsolidated subsidiary | $451 | $246 | $205 | 83.3% |

The losses from unconsolidated subsidiary for the three months ended June 30, 2025 and 2024 represent our share of the net operating losses incurred by Alpha Steel during each period.

### Results of Operations - Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024

*(in thousands, except percentages)*

| Revenue: | Six months ended June 30, 2025 Amounts | Percentage of revenue | 2024 Amounts | Percentage of revenue |
| --- | ---: | ---: | ---: | ---: |
| Product | $34,069 | 83.5% | $19,681 | 81.9% |
| Service | 6,727 | 16.5% | 4,336 | 18.1% |
| Total revenue | 40,796 | 100.0% | 24,017 | 100.0% |
| Cost of revenue: |  |  |  |  |
| Product | 38,987 | 95.6% | 22,834 | 95.1% |
| Service | 9,175 | 22.5% | 5,634 | 23.5% |
| Total cost of revenue | 48,162 | 118.1% | 28,468 | 118.5% |
| **Gross loss** | (7,366) | (18.1%) | (4,451) | (18.5%) |
| Operating expenses |  |  |  |  |
| Research and development | 2,053 | 5.0% | 2,974 | 12.4% |
| Selling and marketing | 2,427 | 5.9% | 4,424 | 18.4% |
| General and administrative | 10,213 | 25.0% | 12,577 | 52.4% |
| Total operating expenses | 14,693 | 36.0% | 19,975 | 83.2% |
| **Loss from operations** | (22,059) | (54.1%) | (24,426) | (101.7%) |
| Interest expense | (1,442) | (3.5%) | (434) | (1.8%) |
| Interest income | 11 | 0.0% | 299 | 1.2% |
| Gain from disposal of investment in unconsolidated subsidiary | 3,204 | 7.9% | 4,085 | 17.0% |
| Gain on sale of Atlas | 50 | 0.1% | — | 0.0% |
| Gain from change in fair value of warrant liability | 1,768 | 4.3% | — | 0.0% |
| Other income, net | 75 | 0.2% | 29 | 0.1% |
| Loss from unconsolidated subsidiary | (563) | (1.4%) | (511) | (2.1%) |
| **Loss before income taxes** | (18,956) | (46.5%) | (20,958) | (87.3%) |
| Provision for income taxes | (293) | (0.7%) | (54) | (0.2%) |
| **Net loss** | $(19,249) | (47.2%) | $(21,012) | (87.5%) |

### Revenue

*(in thousands)*

|  | Six months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Product | $34,069 | $19,681 | $14,388 | 73.1% |
| Service | 6,727 | 4,336 | 2,391 | 55.1% |
| Total revenue | $40,796 | $24,017 | $16,779 | 69.9% |

### Product revenue

The increase in product revenue for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, was primarily due to an increase of 147% in the amount of MW produced as activity has been positively impacted by recent project wins mainly associated with our 1P solar tracker solution. This impact has been partially offset by a decrease of 30% in ASP for the six months ended June 30, 2025, as a result of project mix changes as compared to the six months ended June 30, 2024.

### Service revenue

The increase in service revenue for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, primarily resulted from (i) an increase of 62% in logistics activity levels and (ii) higher engineering consulting revenue associated with new project activity during the six months ended June 30, 2025. This was partially offset by a decrease of 4% in ASP as compared to the six months ended June 30, 2024 as a result of project size and pricing.

### Cost of revenue and gross loss

*(in thousands)*

|  | Six months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Product | $38,987 | $22,834 | $16,153 | 70.7% |
| Service | 9,175 | 5,634 | 3,541 | 62.9% |
| Total cost of revenue | $48,162 | $28,468 | $19,694 | 69.2% |
| **Gross profit (loss)** | $(7,366) | $(4,451) | $(2,915) | (65.5)% |
| Gross profit (loss) percentage of revenue | (18.1%) | (18.5%) |  |  |

The increase in cost of revenue for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, was primarily driven by (i) an increase of 147% in MW produced, (ii) additional costs associated with tariffs and specified minimum purchase commitments with Alpha Steel, a related party, and (iii) an increase of 62% in logistics activity levels. Costs associated with these increases in activity levels were partially offset by lower personnel costs from headcount reductions and lower warranty and remediation expenses.

Our gross margin percentage of revenue for the six months ended June 30, 2025 was a negative 18.1%, which was slightly better than the negative 18.5% for the six months ended June 30, 2024.

We had negative gross margin for the six months ended June 30, 2025 as revenue levels were not sufficient to cover certain overhead costs, including additional costs associated with specified minimum purchase commitments referred to above and due to the impact of increased tariffs and freight costs.

We had negative gross margin for the six months ended June 30, 2024 as (i) production volumes were not sufficient to cover certain overhead costs and (ii) our service revenue was not sufficient to fully cover our warehousing and certain other costs.

### Research and development

*(in thousands)*

|  | Six months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Research and development | $2,053 | $2,974 | $(921) | (31.0%) |

The decrease in research and development expenses for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, was primarily attributable to (i) lower payroll costs of 0.5 million, (ii) lower spending on lab and other research activities of $0.2 million, and (iii) lower professional service costs of $0.2 million resulting from cost reduction initiatives. Research and development expenses as a percentage of revenue were 5.0% for the six months ended June 30, 2025, as compared to 12.4% for the six months ended June 30, 2024.

### Selling and marketing

*(in thousands)*

|  | Six months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Selling and marketing | $2,427 | $4,424 | $(1,997) | (45.1%) |

The decrease in selling and marketing expenses for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, was primarily attributable to (i) lower payroll costs of $0.9 million, (ii) lower provisions for credit losses of $0.4 million, mainly related to charges associated with specific individual customer accounts during 2024, and (iii) lower travel, marketing and professional service costs of $0.5 million accounted for much of the remaining decrease. Selling and marketing costs as a percentage of revenue were 5.9% for the six months ended June 30, 2025, compared to 18.4% for the six months ended June 30, 2024.

### General and administrative

*(in thousands)*

|  | Six months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| General and administrative | $10,213 | $12,577 | $(2,364) | (18.8%) |

The decrease in general and administrative expenses for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, was primarily attributable to (i) lower stock-based compensation totaling $1.6 million, largely associated with certain executive award forfeitures during the six months ended June 30, 2025, (ii) lower professional service costs of $0.8 million resulting from our cost reduction initiatives, (iii) lower insurance costs of $0.4 million, and (iv) lower intangible asset amortization expense of $0.3 million as such assets became fully amortized as of December 31, 2024. This was partially offset by higher payroll costs of $0.6 million largely due to higher executive bonus expense. General and administrative expenses as a percentage of revenue were 25.0% for the six months ended June 30, 2025, compared to 52.4% for the six months ended June 30, 2024. The decrease in the percentage was largely attributable to the increased level of revenue during the six months ended June 30, 2025.

### Interest expense

*(in thousands)*

|  | Six months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Interest expense | $1,442 | $434 | $1,008 | 232.3% |

Interest expense incurred during the six months ended June 30, 2025 was primarily related to paid-in-kind interest added to the principal amount of our Senior Notes, as well as amortization of the discount and deferred loan costs on the Senior Notes. Interest expense during the six months ended June 30, 2024, primarily consisted of letter of credit and commitment fees on our Credit Facility that expired unused in April 2024, along with associated debt issue cost amortization.

### Gain on sale of Atlas

*(in thousands)*

|  | Six months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | --- |
| Gain on sale of Atlas | $50 | $— | $50 | N/A |

We sold our Atlas web-based software platform on December 2, 2024. In connection with the sale, the purchaser agreed to future potential earnout payments based on annual license renewals by certain existing customers during 2025. We received such a payment from the purchaser in June 2025. In accordance with our existing accounting policy, we recognize a gain from these contingent earnout payments upon receipt.

### Gain from disposal of investment in unconsolidated subsidiary

*(in thousands)*

|  | Six months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Gain from disposal of investment in unconsolidated subsidiary | $3,204 | $4,085 | $(881) | (21.6%) |

We sold our 23% equity interest in our unconsolidated subsidiary, Dimension Energy LLC ("Dimension"), on June 24, 2021. Dimension is a community solar developer based in Atlanta, Georgia that provides renewable energy solutions for local communities in the United States.

The sales agreement with Dimension included an earnout provision which provided for the potential to receive additional contingent consideration earned through December 2024, based on Dimension achieving certain performance milestones. The sales agreement also included additional contingent consideration in the form of a projects escrow release based on Dimension’s completion of certain construction projects in progress at the time of the sale.

During the six months ended June 30, 2025 and 2024, we received earnout payments of $3.2 million and $4.1 million, respectively, that were recognized in accordance with our policy election of recording such gains when realized.

### Gain from change in fair value of warrant liability

*(in thousands)*

|  | Six months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | --- |
| Gain from change in fair value of warrant liability | $1,768 | $— | $1,768 | N/A |

36

The Original Warrants issued in connection with the Offering described further in Note 12, "Debt" in our Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report, were classified as a long-term liability. Due largely to a decrease in the price of our common stock during the six months ended June 30, 2025, the fair value of the Original Warrants decreased from $9.5 million at December 31, 2024 to approximately $7.8 million when they were exercised in full on June 30, 2025, resulting in recognition of a non-cash gain for the decrease in value during the six months ended June 30, 2025.

### Loss from unconsolidated subsidiary

*(in thousands)*

|  | Six months ended June 30, 2025 | 2024 | $ Change | % Change |
| --- | ---: | ---: | ---: | ---: |
| Loss from unconsolidated subsidiary | $563 | $511 | $52 | 10.2% |

The losses from unconsolidated subsidiary for the six months ended June 30, 2025 and 2024 represent our share of the net operating losses incurred by Alpha Steel during each period.

### Liquidity and Capital Resources

### Liquidity and going concern

Since our inception, we have financed our operations primarily through sales of shares of common stock, issuance of debt and payments from our customers and others. Our ability to generate positive cash flow from operations is dependent on our level of production, contract payment terms, timely collections from our customers and the strength of our gross margins.

We have incurred cumulative losses since inception and have a history of cash outflows from operations, inclusive of $10.8 million in cash utilized in our operating activities during the six months ended June 30, 2025. As of June 30, 2025, we had cash on hand of $3.5 million and $9.7 million of working capital.

As of June 30, 2025, in addition to our cash on hand and working capital, we had nearly $13.8 million of capacity available for future sales of our common stock under our ATM program as defined and described further in Note 14, "ATM Program" in Part I, Item 1 of this Quarterly Report. There can be no assurance regarding the price at which we will be able to sell such shares, and any sales of our common stock under the ATM program may be at prices that result in additional dilution to our existing stockholders.

As described further in Note 19, "Subsequent events" in Part I, Item 1 of this Quarterly Report, on July 2, 2025 (the "Closing Date"), we entered into a Credit Agreement (the "Credit Agreement") by and among the Company, as borrower, each lender party thereto from time to time (the "Lenders"), and Acquiom Agency Services LLC, as administrative agent for the Lenders. The Credit Agreement provides for a senior secured term facility of up to $75 million, consisting of (i) $14.3 million principal amount of Initial Term Loans that were funded on the Closing Date; (ii) $23.2 million principal amount of First Delayed Draw Term Loans that may be funded during the 90-day period following the Closing Date, subject to Company stockholder approval of the issuance of all of the shares of the Company's common stock issuable upon the full exercise of the warrants issued to the Lenders on the Closing Date in connection with the transactions under the Credit Agreement; and (iii) up to $37.5 million principal amount of Second Delayed Draw Term Loans that may be requested by the Company and approved by the Lenders in their sole discretion. After deductions for certain fees and expenses, the net proceeds received by the Company on the Closing Date from the funding of the Initial Term Loans totaled approximately $13.0 million.

Based on our cash position at June 30, 2025, including consideration of the $13.0 million of net proceeds from the initial funding received on July 2, 2025 under the Credit Agreement, and in view of our recent operating losses and due to the availability of additional financing provided by the Credit Agreement following the Closing Date in the form of the First Delayed Draw Term Loans and Second Delayed Draw Term Loans not being completely within our control, we have concluded that substantial doubt exists as to our ability to continue as a going concern within the next year.

We also have a contractual obligation that could require us to make additional capital contributions of up to $0.8 million to Alpha Steel, as well as make a minimum level of purchases from Alpha Steel, as described further in Note 9, "Equity method investment" in Part I, Item 1 of this Quarterly Report. In the event we were to fail to meet our minimum required purchase commitments during a specified period, including the period from July 1, 2025 to June 30, 2026, we may be required to make a cash payment for the net profit attributable to any unfilled requirements, calculated as specified in the agreement, in an amount not to exceed $4.0 million in the aggregate.

Our ability to meet our liquidity needs over the next year is dependent upon (i) our cash on hand (subject to a $20.0 million minimum unrestricted cash covenant under the Credit Agreement effective for the quarter ended September 30, 2025 (such minimum cash covenant and the other financial covenants under the Credit Agreement as described further in Note 19, "Subsequent events" in Part I, Item 1 of this Quarterly Report)), (ii) our expectations of increased project activity and cash flow during the twelve-month period following issuance of these Condensed Consolidated Financial Statements, (iii) the availability of expected additional proceeds in the form of First Delayed Draw Term Loans under the Credit Agreement during September 2025, the funding of which is subject to Company stockholder approval of the issuance of all of the shares of the Company's common stock issuable upon the full exercise of the warrants issued, and the potential availability of the Second Delayed Draw Term Loans that may be requested by the Company and approved by the Lenders in their sole discretion, and (iv) utilization, as appropriate, of the capacity available for future sales of our common stock under the ATM program, which is currently constrained to a degree by the size of our non-affiliate market capitalization, our trading volume and other factors. In addition, we continue to remain focused on implementing additional cost savings steps, which could impact, among other things, the location of our headcount and the level of services currently provided by third parties.

### Outstanding debt and warrants

At June 30, 2025, we had long-term Senior Notes outstanding, inclusive of paid-in-kind interest, totaling $16.1 million in accumulated principal. In connection with the initial issuance of these Senior Notes in December 2024, we also issued warrants to the institutional investor in the Notes (the "Investor") for 1,750,000 shares of our common stock (the "Original Warrants"). The Investor exercised the Original Warrants in full on June 30, 2025 and received 1,750,000 shares of our common stock in return.

As described above, on July 2, 2025, we entered into a Credit Agreement with the Lenders, including the Investor, for a senior secured term facility of up to $75 million and obtained $14.3 million principal amount of Initial Term Loans from the Lenders maturing on July 2, 2029, receiving proceeds, net of fees and expenses, of approximately $13.0 million. As consideration for the transaction under the Credit Agreement, we also issued warrants to the Lenders to purchase up to an aggregate of 5,418,292 shares of our common stock at an exercise price of $0.01 per share (together with the Amendment Warrants (defined below), collectively, the "New Warrants"). A total of 6,836,237 shares of common stock are issuable upon exercise of the New Warrants, subject to the terms of the New Warrants. The New Warrants are exercisable from time to time in accordance with their terms for either a cash payment equal to the exercise price or on a cashless exercise basis until or prior to 11:59 p.m., New York time, on July 2, 2035. Exercise of the New Warrants are subject to certain exercise caps that limit the number of shares of our common stock issuable under the New Warrants, in the aggregate, to less than 20% of our common stock outstanding on the date the New Warrants were issued, unless stockholder approval is otherwise obtained under applicable Nasdaq rules. We have filed definitive proxy materials for a special meeting of stockholders to be held during the third quarter of 2025 to seek such approval.

Under the Credit Agreement, subject to Company stockholder approval of the issuance of all of the shares of the Company's common stock issuable upon the full exercise of the New Warrants issued, we can obtain an additional $23.2 million principal amount of First Delayed Draw Term Loans from the Lenders under the Credit Agreement. We have filed definitive proxy materials for a special meeting of stockholders to be held during the third quarter of 2025 to seek such approval.

Also, under the Credit Agreement, assuming stockholder approval was obtained as described above, up to $37.5 million principal amount of Second Delayed Draw Term Loans may also be requested by the Company, subject to approval by the Lenders in their sole discretion.

Outstanding obligations under the Credit Agreement are secured by a first priority lien on substantially all tangible and intangible property of the Company and the guarantors and pledges of the equity of certain Company subsidiaries, in each case subject to certain exceptions, limitations and exclusions for the collateral.

In connection with the Credit Agreement, the Investor entered into a Subordination Agreement, dated July 2, 2025 (the “Subordination Agreement”). Pursuant to the Subordination Agreement, the Investor agreed to the subordination of all indebtedness owed by the Company to the Investor, including under the Senior Notes issued by the Company to the Investor on December 4, 2024, to the indebtedness and obligations owed under the Credit Agreement and the other applicable loan documents.

Also, in connection with the Credit Agreement and the Subordination Agreement, the Company and Investor entered into an Amended and Restated Promissory Note, dated July 2, 2025 (the “A&R Promissory Note”). The A&R Promissory Note amends and restates the original Senior Notes to remove the seniority terms of those notes, conform the original Senior Notes to the terms of the Credit Agreement and the Subordination Agreement, amend certain prepayment and make-whole terms under the original Senior Notes, delete certain covenants and event of default terms, reduce the interest rate under the original Senior Notes to 5% per annum paid in cash and 7% per annum paid in kind, and to delete the financial covenants set forth in the original Senior Notes. As a result of an amendment to the Purchase Agreement entered into on July 2, 2025 (the "Purchase Agreement Amendment"), among other things, the Investor agreed to release all liens and guarantees securing the obligations under the Senior Notes, the Purchase Agreement, and the A&R Promissory Note.

In consideration for the Investor's agreements under the A&R Promissory Note, the Subordination Agreement, and the Purchase Agreement Amendment, the Investor received 1,417,945 warrants with a term of 10 years, to purchase our common stock at an exercise price of $0.01 per share (the "Amendment Warrants").

### Statements of cash flows

The following table shows our cash flows from operating activities, investing activities and financing activities for the stated periods:

*(in thousands)*

|  | Six months ended June 30, 2025 | 2024 |
| --- | ---: | ---: |
| Net cash used in operations | $(10,780) | $(15,635) |
| Net cash provided by investing activities | 2,989 | 1,154 |
| Net cash provided by financing activities | 3 | 3 |
| Effect of exchange rate changes on cash and cash equivalents | 60 | 22 |
| Decrease in cash and cash equivalents | $(7,728) | $(14,456) |

#### Operating activities

During the six months ended June 30, 2025, we used approximately $13.4 million of cash to fund a portion of our current period expenditures for personnel and facilities, legal and professional fees, insurance, research and development and various other operating activities. This compares to approximately $17.1 million of cash used during the six months ended June 30, 2024, also to fund a portion of our prior period expenditures for various operating activities as described above.

During the six months ended June 30, 2025 and 2024, we generated approximately $2.7 million and $1.5 million of cash, respectively, primarily from working capital reductions, including timing of customer receipts and vendor payments.

Our working capital decreased by approximately $17.4 million from almost $27.1 million at December 31, 2024 to $9.7 million at June 30, 2025. The decrease was largely attributable to (i) the use of cash to fund current period expenditures as described above and (ii) the impact of higher activity levels on various components of working capital during the six months ended June 30, 2025.

#### Investing activities

During the six months ended June 30, 2025, we received a $3.2 million contingent earnout payment in connection with the June 2021 sale of our equity interest in Dimension, as well as a small earnout payment from the sale of our Atlas software platform in 2024. We also had capital expenditures of approximately $0.3 million, primarily for tooling.

During the six months ended June 30, 2024, we received $4.1 million of contingent earnout payments from Dimension. We also made an additional equity investment of $1.8 million in Alpha Steel and spent nearly $1.1 million, mainly for tooling and new computer and IT equipment.

#### Financing activities

During the six months ended June 30, 2025 and 2024, we received a minimal amount of proceeds from employee exercises of stock options during each period.

### Critical Accounting Policies and Significant Management Estimates

Preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported revenue and expenses during the period. Estimates are used for calculating the measure of progress of our solar tracker projects and deriving the standalone selling prices of the individual performance obligations when determining amounts to recognize for revenue, estimating allowances for credit losses and slow-moving and obsolete inventory, determining useful lives of long-lived assets and the estimated fair value of those assets for impairment assessments, and estimating the fair value of investments, warrants, stock compensation awards, warranty liabilities and federal and state taxes, including tax valuation allowances, as well as other contingencies. We base our estimates on historical experience and anticipated results, trends, and various other assumptions that we believe are reasonable under the circumstances, including assumptions as to future events. Actual results could differ from those estimates due to risks and uncertainties.

To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected. We believe that the accounting policies discussed below are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates. Critical accounting policies and estimates are those that we consider the most important to the portrayal of our financial condition and results of operations because they require our most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain.

We believe that the accounting policies described below involve a significant degree of judgment and complexity. Accordingly, we believe these are the most critical to aid in fully understanding and evaluating our condensed consolidated financial condition and results of operations.

### Revenue recognition

Our accounting policy on revenue recognition may be found in Note 2, "Summary of significant accounting policies" in our Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report.

#### Judgments and assumptions

The timing and amounts of revenue and cost of revenue recognition, as well as recording of related receivables and deferred revenue, is highly dependent on our identification of performance obligations in each contract and our estimates by contract of total project cost and our progress toward project completion as of each period end. Certain estimates are subject to factors outside of our control that may impact our suppliers and the global supply chain. As an example, we began to experience increases in steel prices and shipping and logistics costs, as well as delays in delivery of our products to customers during 2021, which negatively impacted our results of operations as we were not able to recover all of the additional costs under certain of our fixed fee contracts. In addition, regulatory, tariff and import concerns such as those caused by the UFLPA and the Solar Circumvention Investigation have in the past, and may continue to, affect our ability to obtain project materials and may delay the timing of customer project activity which has had in the past, and may continue to have, an adverse impact on our results of operations, including the expected timing of the recognition of revenue needed to cover our relatively fixed overhead costs. We base our estimates on the best information available at each period end, but future events and their effects cannot be determined with certainty, and actual results could differ materially from our assumptions and estimates.

### Accounts receivable, net

Our accounting policy relating to our accounts receivable and allowance for credit losses may be found in Note 2, "Summary of significant accounting policies" in our Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report.

#### Judgments and assumptions

The allowance for credit losses is based on the lifetime expected credit loss of our customer accounts. To assess the lifetime expected credit loss, we utilize a loss rate method that takes into consideration historical experience and certain other factors, as appropriate, such as credit quality, current economic or other conditions and changes in project status that may affect a customer's ability to pay. This method accelerates the recognition of expected credit losses as compared to the incurred loss model used prior to 2023 and may result in material differences between our estimates and actual collection results. We may also have greater fluctuations in our credit loss expense over time based on changes in our historical experience or changes in estimates of future economic conditions which may not adequately reflect future actual customer payment activity.

Adjustments to the allowance are largely dependent on historical experience involving amounts previously collected from our customers in recent years or based on specific changes in a customer's ability to pay. As an example, during the six months ended June 30, 2025, we recognized additional credit loss provisions of $0.2 million compared to $0.6 million recognized during the six months ended

June 30, 2024, with the change primarily related to our assessments in both 2025 and 2024 as to the ability by certain specific customers to fully pay contractual amounts owed us. Historical experience, when used in making such adjustments, may not reflect current actual experience.

### Warranty

Our accounting policy relating to our warranty obligations may be found in Note 2, "Summary of significant accounting policies" in our Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report.

#### Judgments and assumptions

We base our estimated warranty obligations on available industry data relating to the nature and frequency of product failure rates and, where possible, on our historical experience, to make estimates of costs to address future claims. These estimates are inherently uncertain given our relatively short history of sales, and changes to our historical or projected warranty experience or fluctuations in available industry data may result in material changes to our warranty reserves in the future. Additionally, we make estimates of what costs we believe will be recoverable from the manufacturers of our products that we use to offset our obligations to our customers.

While we periodically monitor our warranty activities and claims, if actual costs incurred were to be different from our estimates, we would recognize adjustments to our warranty reserves in the period in which those differences arise or are identified. Such adjustments could be material to the cost of revenue in our results of operations in the period the adjustments are made.

### Stock-based compensation and warrants

Our accounting policies relating to our stock-based compensation and our outstanding Warrants may be found in Note 2, "Summary of significant accounting policies" in our Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report.

#### Judgments and assumptions

The Black-Scholes model and Monte Carlo simulations rely on various assumptions, in addition to the exercise price of an option award or our Warrants and the value of our common stock on the date of grant. These assumptions include:

*Expected Term:* The expected term represents the period that the Company’s stock-based awards and Warrants are expected to be outstanding and is calculated for option grants as the average of the option vesting and contractual terms, based on the simplified method, as we do not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term for options granted. The simplified method deems the term to be the average of the time-to-vesting and the contractual life of the options. The contractual life of an option may be up to 10 years. Monte Carlo simulations, as described below, estimate the derived service period of awards with market conditions.

*Expected Volatility:* Since the Company did not have a trading history of its common stock prior to our IPO and since such trading history subsequent to our IPO is limited and may be less than the expected term of an award or our Warrants, the expected volatility is derived from a weighted average of (i) our historical volatility over our entire trading history, with respect to certain more recent awards, and (ii) the average historical stock volatilities of several public companies within the Company’s industry that it considers to be comparable to its business over a period equivalent to the expected term of the stock option grants, or awards granted with market conditions.

*Risk-Free-Interest-Rate:* The Company bases the risk-free interest rate on the implied yield available on U.S. Treasury zero-coupon issues with a remaining term equivalent to the expected term or derived service or performance period.

*Expected Dividend:* The Company has not issued any dividends in its history and does not expect to issue dividends over the life of option grants or awards with market conditions and, therefore, has estimated the dividend yield to be zero.

We used Monte Carlo simulations for certain awards granted with market conditions which provided an estimated average present value for each award based on a simulation assuming Geometric Brownian Motion in a risk-neutral framework using up to 250,000 simulation paths to determine the derived service and vesting periods.

Our use of the simplified method for estimating the expected outstanding term of our options may differ significantly from future actual exercise patterns of our option holders. Estimates of the outstanding terms of our options, which are less than the actual exercise patterns of our option holders, may result in lower recognized expense. Alternatively, our recognized expense may be higher if our option holders exercise their options sooner than our estimates project.

Similarly, our use of a volatility estimate based on historical stock volatilities of a peer group of other public companies may differ significantly from the actual future volatility of our stock over the term our Warrants and our options or awards with market conditions are held. Higher estimated volatility compared to future actual results may result in higher recognized expense or fair value of our Warrants and alternatively, lower expected volatility compared to future actual results may result in lower recognized expense or fair value of our Warrants.

Changes to any of our assumptions, but particularly our estimates of expected term or derived service period and volatility, could change the fair value of our Warrants, as well as our options or awards with market conditions which could impact the amount of stock-based compensation expense we report each period. Changes in the trading price of our common stock on Nasdaq could also have a significant impact on the fair value of our Warrants, as well as whether awards with market conditions are ultimately earned.

### Impairment

Our accounting policies relating to impairment of our long-lived assets held for use and of goodwill may be found in Note 2, "Summary of significant accounting policies" in our Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report.

#### Judgments and assumptions

Key judgments and assumptions involving our assessment of impairment of our long-lived assets, as well as goodwill, may include:

- Determination of whether events or changes in circumstances indicate that the carrying value of our long-lived assets or goodwill might be impaired. Such factors to consider may include an evaluation of changes in the business or regulatory climate, market conditions or other events impacting our operations;
- Estimating future cash flows of our long-lived assets or asset groups, which may involve assumptions as to the lowest level of our assets at which cash flows are generated, including future growth and risk-adjusted discount rates, as well as a terminal growth rate or value and future market conditions;
- Estimates of assumptions a market participant would use in determining the fair value of the affected long-lived assets or asset groups; and
- Estimating the fair value of the consolidated company.

In estimating the fair value of the consolidated company, we used our market capitalization based on our closing stock price on the Nasdaq Capital Market at June 30, 2025. Our daily closing stock price is affected by numerous factors, some of which may not directly involve the operations of the company and, historically, has demonstrated high volatility.

We did not identify any impairments of our long-lived assets or goodwill during the six months ended June 30, 2025 and 2024.

### JOBS Act accounting election

We are an emerging growth company, as defined in the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We elected to use the allowed extended transition period for adopting new or revised accounting standards.

### Non-GAAP Financial Measures

### Adjusted EBITDA, adjusted net loss and adjusted earnings per share ("EPS")

We utilize Adjusted EBITDA, Adjusted Net Loss, and Adjusted EPS as supplemental measures of our performance. We define Adjusted EBITDA as net loss plus (i) provision for (benefit from) income taxes, (ii) interest expense, less interest income, (iii) depreciation expense, (iv) amortization of intangibles, (v) stock-based compensation, (vi) loss from changes in the fair value of our warrant liability, and (vii) Chief Executive Officer ("CEO") transition costs, non-routine legal fees, costs associated with our Reverse Stock Split, severance and certain other costs (credits). We also deduct the contingent gains arising from earnout payments and project escrow releases relating to the disposal of our investment in an unconsolidated subsidiary and gains from changes in fair value of our warrant liability from net loss in arriving at Adjusted EBITDA. We define Adjusted Net Loss as net loss plus (i) amortization of debt discount and issue costs and intangibles, (ii) stock-based compensation, (iii) loss from changes in the fair value of our warrant liability, (iv) CEO transition costs, non-routine legal fees, costs associated with our Reverse Stock Split, severance and certain other costs (credits), and (v) the income tax expense (benefit) of those adjustments, if any. We also deduct the contingent gains arising from earnout payments and project escrow releases relating to the disposal of our investment in an unconsolidated subsidiary and gains from changes in fair value of our warrant liability in arriving at Adjusted Net Loss. Adjusted EPS is defined as Adjusted Net Loss on a per share basis using our weighted average diluted shares outstanding.

Adjusted EBITDA, Adjusted Net Loss, and Adjusted EPS are intended as supplemental measures of performance that are neither required by, nor presented in accordance with, U.S. GAAP. We present Adjusted EBITDA, Adjusted Net Loss and Adjusted EPS, because we believe they assist investors and analysts in comparing our performance across reporting periods on an ongoing basis by excluding items that we do not believe are indicative of our core operating performance. In addition, we use Adjusted EBITDA, Adjusted Net Loss and Adjusted EPS to evaluate the effectiveness of our business strategies.

Among other limitations, Adjusted EBITDA, Adjusted Net Loss, and Adjusted EPS do not reflect (i) our cash expenditures, or future requirements, for capital expenditures or contractual commitments, and (ii) the impact of certain cash charges resulting from matters we consider not to be indicative of our ongoing operations. Further, the adjustments noted in Adjusted EBITDA do not reflect the impact of any income tax expense or benefit. Additionally, other companies in our industry may calculate Adjusted EBITDA, Adjusted Net Loss, and Adjusted EPS differently than we do, which limits its usefulness as a comparative measure.

Because of these limitations, Adjusted EBITDA, Adjusted Net Loss, and Adjusted EPS should not be considered in isolation or as substitutes for performance measures calculated in accordance with U.S. GAAP, and you should not rely on any single financial measure to evaluate our business. These non-GAAP financial measures, when presented, are reconciled to the most closely applicable U.S. GAAP measure as disclosed below for the three and six months ended June 30, 2025 and 2024:

*(in thousands, except shares and per share data)*

|  | Three months ended June 30, 2025 Adjusted EBITDA | Adjusted Net Loss | 2024 Adjusted EBITDA | Adjusted Net Loss |
| --- | ---: | ---: | ---: | ---: |
| **Net loss per U.S. GAAP** | $(15,430) | $(15,430) | $(12,241) | $(12,241) |
| Reconciling items - |  |  |  |  |
| Provision for income taxes | 39 | — | 65 | — |
| Interest expense | 731 | — | 117 | — |
| Interest income | (5) | — | (118) | — |
| Amortization of debt discount and issue costs in interest expense | — | 217 | — | 59 |
| Depreciation expense | 305 | — | 274 | — |
| Amortization of intangibles | — | — | 134 | 134 |
| Stock-based compensation | 936 | 936 | 1,285 | 1,285 |
| Loss from change in fair value of warrant liability(a) | 2,836 | 2,836 | — | — |
| CEO transition(b) | 228 | 228 | — | — |
| Non-routine legal fees(c) | — | — | 33 | 33 |
| **Adjusted Non-GAAP amounts** | $(10,360) | $(11,213) | $(10,451) | $(10,730) |
| **U.S. GAAP net loss per share:** |  |  |  |  |
| Basic and diluted(d) | N/A | $(1.18) | N/A | $(0.97) |
| **Adjusted Non-GAAP net loss per share (Adjusted EPS):** |  |  |  |  |
| Basic and diluted(d) | N/A | $(0.86) | N/A | $(0.85) |
| **Weighted-average common shares outstanding:** |  |  |  |  |
| Basic and diluted(d) | N/A | 13,098,825 | N/A | 12,617,128 |

43

(a) We exclude non-cash changes in the fair value of our outstanding Warrants as we do not consider such changes to impact or reflect changes in our core operating performance.

(b) In connection with hiring a new CEO in August 2024, we agreed to upfront and incremental sign-on bonuses (collectively, the "sign-on bonuses"), a portion of which was paid to our CEO in 2024, with clawback provisions over the next two years, and a portion of which will be paid annually during 2025 and 2026, all contingent upon continued employment. These sign-on bonuses will be expensed over the periods through October 1, 2026, to reflect the required service periods. We do not view these sign-on bonuses as being part of the normal on-going compensation arrangements for our CEO.

(c) Non-routine legal fees represent legal fees and other costs incurred for specific matters that were not ordinary or routine to the operations of the business.

(d) Prior year per-share amounts and number of shares, as applicable, have been revised to reflect the Reverse Stock Split, effective November 29, 2024.

*(in thousands, except shares and per share data)*

|  | Six months ended June 30, 2025 Adjusted EBITDA | Adjusted Net Loss | 2024 Adjusted EBITDA | Adjusted Net Loss |
| --- | ---: | ---: | ---: | ---: |
| **Net loss per U.S. GAAP** | $(19,249) | $(19,249) | $(21,012) | $(21,012) |
| Reconciling items - |  |  |  |  |
| Provision for income taxes | 293 | — | 54 | — |
| Interest expense | 1,442 | — | 434 | — |
| Interest income | (11) | — | (299) | — |
| Amortization of debt discount and issue costs in interest expense | — | 427 | — | 236 |
| Depreciation expense | 607 | — | 544 | — |
| Amortization of intangibles | — | — | 268 | 268 |
| Stock-based compensation | 1,216 | 1,216 | 2,924 | 2,924 |
| Gain from disposal of investment in unconsolidated subsidiary(a) | (3,204) | (3,204) | (4,085) | (4,085) |
| Gain from change in fair value of warrant liability(b) | (1,768) | (1,768) | — | — |
| CEO transition(c) | 388 | 388 | — | — |
| Non-routine legal fees(d) | — | — | 66 | 66 |
| Reverse stock split(e) | 1 | 1 | — | — |
| Severance costs(f) | 175 | 175 | — | — |
| **Adjusted Non-GAAP amounts** | $(20,110) | $(22,014) | $(21,106) | $(21,603) |
| **U.S. GAAP net loss per share:** |  |  |  |  |
| Basic and diluted(g) | N/A | $(1.49) | N/A | $(1.67) |
| **Adjusted Non-GAAP net loss per share (Adjusted EPS):** |  |  |  |  |
| Basic and diluted(g) | N/A | $(1.70) | N/A | $(1.72) |
| **Weighted-average common shares outstanding:** |  |  |  |  |
| Basic and diluted(g) | N/A | 12,948,189 | N/A | 12,581,608 |

(a) We exclude the gain from collections of contingent contractual amounts arising from the sale in 2021 of our investment in an unconsolidated subsidiary as these amounts are not considered part of our normal ongoing operations.

(b) We exclude non-cash changes in the fair value of our outstanding Warrants as we do not consider such changes to impact or reflect changes in our core operating performance.

(c) In connection with hiring a new CEO in August 2024, we agreed to upfront and incremental sign-on bonuses (collectively, the "sign-on bonuses"), a portion of which was paid to our CEO in 2024, with clawback provisions over the next two years, and a portion of which will be paid annually during 2025 and 2026, all contingent upon continued employment. These sign-on bonuses will be expensed over the periods through October 1, 2026, to reflect the required service periods. We do not view these sign-on bonuses as being part of the normal on-going compensation arrangements for our CEO.

(d) Non-routine legal fees represent legal fees and other costs incurred for specific matters that were not ordinary or routine to the operations of the business.

(e) We incurred incremental professional fees in 2025 relating to final reconciliation of information relating to our stock compensation awards as a result of the Reverse Stock Split that was consummated effective November 29, 2024. We do not consider these fees to be part of our normal ongoing operations.

(f) Severance costs in 2025 were due to restructuring changes.

(g) Prior year per-share amounts and number of shares, as applicable, have been revised to reflect the Reverse Stock Split, effective November 29, 2024.

44

## Market risk

As filed, 4,802 characters.

We are exposed to market risk in the ordinary course of our business. Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Our market risk exposure is primarily a result of customer concentrations and fluctuations in steel, aluminum and logistics/transportation prices, as well as from fluctuations in the trading price of our common stock. We do not hold or issue financial instruments for trading purposes.

### Fair value of financial instruments

Our financial instruments consist of cash, cash equivalents, accounts receivable, accounts payable, warrants and debt obligations. Cash, cash equivalents, accounts receivable and accounts payable are stated at their carrying value, which approximates fair value due to the short time to the expected receipt or payment date. We estimate the fair value of our warrants using a Black-Scholes model involving current assumptions at each reporting period of (i) the per share value of our common stock, (ii) the expected holding period of the warrants before exercise, (iii) the estimated volatility of our stock over the expected holding period of the warrants, (iv) a risk free interest rate over the expected holding period of the warrants and, (v) an estimated dividend yield on our common stock over the expected holding period of the warrants. Each of those assumptions are subject to change over time.

We had $3.5 million of cash and cash equivalents on hand, the vast majority of which was located in the United States as of June 30, 2025. We regularly maintain cash balances with various financial institutions that exceed federally insured amounts, but we have experienced no losses associated with these amounts to date. We periodically evaluate the financial health of the financial institutions we use and may take action in future periods, similar to past actions, to reallocate cash balances between financial institutions based on our evaluation.

Certain of our cash equivalents include deposits in money market funds that invest primarily in short-term securities issued or guaranteed by the U.S. government or its agencies or instrumentalities and contain no restrictions on immediate redemption. The carrying value for these money market fund deposits approximates fair value based on quoted prices in active markets for units held (Level 1 classification) and totaled $0.5 million at both June 30, 2025 and December 31, 2024.

At June 30, 2025, we had Senior Notes outstanding with principal and accrued paid-in-kind interest totaling $16.1 million. The fair value of our debt is impacted by changes in interest and market rates for similar debt and the fair value of our Warrants is largely impacted by changes in the trading price of our common stock, among other factors.

We have no other financial instruments as of June 30, 2025 or December 31, 2024, other than certain non-functional currency intercompany and third-party receivables and payables, which are subject to foreign exchange, interest rate or market risks.

### Concentrations of major customers

Our customers include project developers, solar asset owners and EPCs that design and build solar energy projects. We extend credit to customers in the normal course of business, often without requiring collateral. We also perform credit analyses and monitor the financial health of our customers to reduce credit risk.

We typically rely on a small number of customers that account for a large portion of our revenue each period and our outstanding receivables at each period end.

Further, our accounts receivable are from companies within or serving the solar industry and, as such, we are exposed to normal industry credit risks. We continually evaluate our reserves for potential credit losses and establish initial reserves based on our expectation of lifetime expected credit losses.

### Commodity price risk

We subcontract to various contract manufacturers, who manufacture and deliver products directly to our customers. We, therefore, do not procure raw materials and commodities directly, except for items added to our inventory. We are subject to indirect risk from fluctuating market prices of certain commodity raw materials, including steel and aluminum, which are used in our products, through our contract manufacturers, as increases in these commodity prices would increase our cost of procuring subcontracting services. Prices of these raw materials may be affected by supply restrictions or other market factors from time to time. Significant price increases for these raw materials could reduce our operating margins if we are unable to recover such increases in costs from our customers, and could harm our business, financial condition and results of operations.

## Controls and procedures

As filed, 2,882 characters.

### Evaluation of disclosure controls and procedures

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act") as of the end of the period covered by this Quarterly Report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of June 30, 2025 in providing reasonable assurance that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

### Identification of material weakness

During the fourth quarter of 2024, we identified a control failure that occurred in regard to a specific fact pattern involving the accounting for contract change orders with a specific customer that resulted in an overstatement in our calculation of revenue being recognized over time on certain affected projects. The error was corrected and reflected properly in our 2024 Consolidated Financial Statements. Based on our assessment of other projects with a similar fact pattern, we believe the error was limited to the identified projects and was not pervasive in our process of revenue recognition involving other customers and projects, and has no impact on any previously reported financial results.

Due to the significance of our accounting for revenue, we deemed this to be a material weakness in our controls involving recognition of revenue over time. As a result, we are continuing our efforts to enhance our internal accounting processes and management review controls in an effort to be more effective in preventing and detecting such errors on a more timely basis in the future.

### Changes in internal control over financial reporting

There were no changes in our internal control over financial reporting that occurred during the three months ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

## Risk factors

As filed, 11,705 characters.

We are subject to a number of risks that in some cases have and moving forward if realized could further adversely affect our business, strategies, prospects, financial condition, results of operations and cash flows. Some of the more significant risks and uncertainties we face include those summarized below. In addition to the risk factors set forth below and the other information set forth in this Quarterly Report on Form 10-Q, you should carefully consider the risk factors set forth in Item 1A. "Risk Factors" in our 2024 Annual Report, which could materially affect our business, financial condition, or future results. Please carefully consider all of the information in this Quarterly Report and our 2024 Annual Report, including the full set of risks set forth in Item 1A. "Risk Factors" of our 2024 Annual Report, and in our other filings with the SEC before making an investment decision regarding us.

***Recent developments and changes in international trade policy, including the implementation of tariffs by the United States government on various countries, has and may continue to impact our expected profitability under certain contracts.***

During the first two quarters of 2025, there have been further developments with regard to international trade policy, including implementation of tariffs by the United States government on various countries. For example, effective April 5, 2025, the United States imposed a universal 10% tariff on most imports into the United States, excluding certain trade agreements. Tariff rates continue to change and fluctuate as negotiations continue between the United States and various countries. As an example, the United States previously imposed a 145% tariff on goods imported from China, and China imposed a retaliatory 125% tariff on goods imported from the United States. In May 2025, the U.S. and China agreed to a 90-day rollback whereby the United States cut the Chinese levies from 145% to 30% and China lowered the duties on U.S. goods from 125% to 10%, effective May 14, 2025. Also, in May 2025, the Trump administration announced the doubling of steel and aluminum tariffs to 50%. New reciprocal tariffs have also been announced on selected countries that are well above the universal 10% tariff rate. As of the filing of this Quarterly Report, matters involving tariffs continue to evolve and change, including in some cases, implementation of temporary pauses on certain announced tariffs as negotiations on final trade deals occur. Depending on the terms of our existing contracts with customers, we may not in all cases be able to fully recover the increased cost for delivery of tracker systems currently being manufactured for our customers by our international vendors due to higher tariffs currently in place, which has and may continue to impact our expected profitability under certain contracts. Imposition of new or higher tariffs could also adversely affect the amount or timing of our future revenue, results of operations or cash flows.

***Changes in current laws or regulations or the imposition of new laws or regulations, or new interpretations thereof, in the solar energy sector, by federal or state agencies in the United States or foreign jurisdictions could impair our ability to compete and could materially harm our business, financial condition and results of operations.***

There has been, and will continue to be, regulatory uncertainty in the clean energy sector generally and the solar energy sector in particular. Changes in current laws or regulations, or the imposition of new laws and regulations in the United States and around the world, could materially and adversely affect our business, financial condition and results of operations. In addition, any changes to the laws and implementing regulations affecting the clean energy sector may create delays in the introduction of new products, prevent our customers from deploying our products or, in some cases, require us to redesign our products.

For example, on July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act, which accelerates the phase-outs and terminations of various eligible tax credits enacted as part of the IRA and places restrictions on continued receipt of tax credits by specified foreign entities and foreign influenced entities. The reduction, elimination or expiration of government incentives for, or regulations mandating the use of, as well as corporate commitments to the use of renewable energy and solar energy specifically could reduce demand for solar energy systems and harm our business, financial condition and results of operations.

***The terms and covenants, including financial covenants, set forth in the Credit Agreement could restrict our business, and if we do not comply with the covenants, including financial covenants, set forth in the Credit Agreement, our financial condition and results of operations could be adversely affected, including as a result of the Lenders' foreclosure on their first priority security interest in substantially all of our assets. In addition, our ability to borrow further term loans under the Credit Agreement is effectively subject to stockholder approval, and our operations may not provide sufficient cash to meet the repayment obligations under the Credit Agreement or to satisfy the minimum cash covenant that will apply to the Company on September 30, 2025.***

In addition to the obligation to repay the principal amount of the Credit Agreement and related interest, the Credit Agreement includes customary affirmative and negative covenants, such as restrictions on our business activities, including debt incurrence, asset dispositions, distributions, and investments. The Credit Agreement also includes financial covenants that require the Company to: (i) maintain a minimum amount of unrestricted cash as of the end of each quarter starting with the quarter ending September 30, 2025 (at which time we will be required to have at least $20.0 million of unrestricted cash); (ii) generate minimum revenue over the twelve month periods ending December, 31, 2025, June 30, 2026, December 31, 2026 and the last day of each June and December thereafter; (iii) maintain minimum direct tracker margin measured on the last day of each fiscal quarter and each fiscal year starting with the fiscal quarter ending March 31, 2026; (iv) achieve a minimum consolidated EBITDA for each fiscal year, beginning with the fiscal year ending December 31, 2026; and (v) generate minimum purchase order amounts measured for the period from July 1, 2025 through December 31, 2025, January 1, 2026 through June 30, 2026, July 1, 2026 through December 31, 2026, and for each period of six months ending on the last day of each June and each December thereafter. The Credit Agreement is also subject to certain customary events of default and other event of default provisions that can be triggered by, among other things: (i) breach of payment obligations and other obligations and representations in the Credit Agreement or other loan documents; (ii) default under other material indebtedness of the Company and its subsidiaries; (iii) breach of the covenants, including the financial covenants, set forth in the Credit Agreement; (iv) commencement of certain involuntary bankruptcy proceedings or voluntary bankruptcy proceedings involving the Company, its subsidiaries or Alpha Steel; (v) one or more judgments, penalties or fines are rendered against the Company, its subsidiaries or Alpha Steel in excess of $500,000 (subject to certain exceptions and qualifications) or that involve an injunction that could reasonably be expected to result in a material adverse effect on the Company; (vi) the New Warrants and related documents are not in full force and effect or the Company defaults in the performance of its obligations under the New Warrants and related documents; or (vii) there is a change in control of the Company or the Company no longer owns at least 40% of Alpha Steel.

Additionally, the availability of, and the Lenders' obligations to fund, the additional $23.2 million of First Delayed Draw Term Loans under the Credit Agreement is subject to, among other conditions, approval by our stockholders of the full exercise of the New Warrants at the special meeting of stockholders to be held on September 4, 2025. If the requisite number of our stockholders do not provide this approval, there is no assurance that the First Delayed Draw Term Loans would be funded. We may not be able to comply with the minimum cash covenant applicable to us as of the quarter ending September 30, 2025 if we do not otherwise generate sufficient cash flows from our operating activities or secure other financing.

If we are not able to satisfy our obligations under the Credit Agreement, including compliance with the affirmative, negative and financial covenants applicable to the Company, or if there are events of defaults under the Credit Agreement, the Lenders will have the right to foreclose on their first priority security interest relating to substantially all of our assets to the exclusion of our general unsecured creditors. In the event of a default under the minimum cash covenant and other financial covenants, the Credit Agreement effectively requires us to reasonably cooperate in good faith with the Lenders to pursue strategic alternative transactions (including potential sale transactions), which may or may not result in sufficient proceeds to pay off the obligations under the Credit Agreement and also generate a return to our stockholders. If the Lenders pursue foreclosure, any such foreclosure would have a material and adverse impact on our business.

Additionally, while the obligations under the Credit Agreement are outstanding, the security interest granted to the Lenders and the other terms and conditions imposed by the Senior Notes may limit our flexibility in raising capital. Given the security interest granted in favor of the Lenders under the Credit Agreement in our assets (and the guarantees provided by our subsidiaries), we are constrained in our ability to incur additional secured indebtedness or to sell, transfer or dispose of our assets to raise capital without the Lenders’ consent, which could have an adverse impact on our financial flexibility.

***A substantial number of shares of our common stock are issuable under the New Warrants and, if the New Warrants are exercised, will have a dilutive impact, and may be sold in this offering, which could cause the price of our common stock to decline.***

New Warrants exercisable for up to 6,836,237 shares of our common stock were issued to the Lenders in connection with the transactions relating to the Credit Agreement, which would equal approximately 31.5% of our outstanding shares (based on 14,874,797 shares of our common stock outstanding as of July 25, 2025 and assuming the full exercise of the New Warrants). As a result, the ownership interest of our existing stockholders would be correspondingly reduced upon the exercise of the New Warrants. The issuance of shares of our common stock upon the exercise of the New Warrants could also have a dilutive effect on our book value per share and future earnings per share. In addition, the sale and any future sales of a substantial number of shares of our common stock in the public market, or the perception that such sales may occur, could adversely affect the price of our common stock. We cannot predict the effect, if any, that market sales of those shares of common stock or the availability of those shares of common stock for sale will have on the market price of our common stock.

Filed Aug 5, 2025.
Source: SEC EDGAR, the filing index for accession 0000950170-25-102455. Last ingested by Listed: Oct 24, 2026, 15:15 ET. No prices; not investment advice.