SES

Image source: The Motley Fool. Tuesday, Aug. 11, 2026 at 5 p.m. ET Chief Legal Officer - Kyle Pilkington Founder and Chief Executive Officer - Qichao Hu Chief Financial Officer - Ray Liu Need a quote from a Motley Fool analyst? Email [email protected] Operator: Hello, everyone. Thank you for joining us and welcome to the SES AI second quarter earnings release and call. After today's prepared remarks, we will host a question and answer session. [Operator Instructions] I will now hand the conference over to Kyle Pilkington, Chief Legal Officer. Kyle, please go ahead. Kyle Pilkington: Hello everyone and welcome to our conference call covering our second quarter 2026 results. Joining me today are Qichao Hu, Founder and Chief Executive Officer; and Ray Liu, Chief Financial Officer. We issued our shareholder letter just after 4:00 p.m. today, which provides a business update as well as our financial results. You will find a press release with a link to our shareholder letter and today's conference call webcast in the investor relations section of our website at ses.ai. Before we get started, this is a reminder that the discussion today may contain forward-looking information or forward-looking statements within the meaning of applicable securities legislation. These statements are based on our predictions and expectations as of today. Such statements involve certain risks, assumptions, and uncertainties, which may cause our actual or future results in performance materially different from those expressed or implied in these statements. The risks and uncertainties that could cause our results to differ materially from our current expectations include, but are not limited to, those detailed in our latest earnings release and in our SEC filings. On this call, we will discuss non-GAAP financial measures as a supplement to our GAAP results. These non-GAAP measures are not prepared in accordance with generally accepted accounting principles but are intended to illustrate alternative measures of the company's operating performance that may be useful. These non-GAAP measures should not be considered an isolation or as a substitute for any GAAP measure, and our definitions may differ from those used by other companies reporting similarly titled measures. Reconciliations of the non-GAAP financial measures to the most directly comparable GAAP measures can be found in our latest earnings release. With that, I'll pass it over to Qichao. Qichao Hu: Thank you, Kyle. SES is solving 2 of the most difficult challenges in energy storage, accelerating product development using AI for materials and building a robust supply chain to manufacture these products. We originally focused on EV and pivoted more than a year ago to ESS and drones applications. In Q2, we began seeing significant commercial milestones, and we are very excited about the path we're on. Our Q2 revenue grew by more than 40% compared to Q2 last year. And our gross margin improved from 18% to more than 22% due to our differentiated technology and robust supply chain. And we are reaffirming our 2026 revenue guideline of $30 to $35 million. On accelerating product development using AI for materials, we release Molecular Universe MU-3.0, our first agentic workflow platform that works for sodium chemistry as well as lithium chemistry and can be integrated with autonomous labs deployed fully secured and on-premise. We shipped our first Search-in-a-Box order to one of the world's largest battery manufacturers, and some of the materials discovered by Molecular Universe have completed testing and entered pilot commercial deployment. On building a robust supply chain to manufacture these products, for ESS, this is our largest revenue generating unit. We're making great progress, especially in the U.S. market. We were selected by Sol-Ark as a certified battery partner, and we brought on Paul Diemer, ex-CTO of Flex Power to our board to help guide our ESS strategy. And we continue to hire a stellar team with background in leading AI data center total solution providers to execute and deliver our exciting ESS growth. For drones and unmanned systems, we are recruiting a team with a proven track record of selling to defense and commercial drones. We expect to start producing 1 million NDAA-compliant cells per year in about 1 month at our Korea plant. And based on the strong customer demand we are seeing, at taking orders well into 2028. I'll dive into each topic separately. On ESS, while most competitors sell either pure hardware that don't have intelligent software or pure software that are not trained on real world data. Our edgebox-enabled ESS systems are trained on the specific cells that we use in our hardware systems, allowing for one-to-one matching accurate state of health and safety management. This prediction accuracy not only helps preventing fire and other incidents. This is tremendous saving for our customers across residential, commercial, industrial, and data centers. One of the leading U.S.-based FCC authorized inverter producers, Sol-Ark, certified our subsidiary, UZ's low voltage residential batteries for their hybrid inverter systems. We believe this certification with Sol-Ark will greatly accelerate the growth of UZ's revenue in the U.S. especially given the recent FCC restrictions around foreign produced inverters and other electronics. We were also honored to bring on Paul Diemer to our board of directors. Paul served as the CTO of Flex Power, where he ran critical and embedded power group that was responsible for delivering power solutions to data centers and other industrial systems. Paul also ran new EV product architecture at BorgWarner. Paul transition from EV to data centers is very similar to that of SES. On drones and unmanned systems, we expect to complete the scale up of our Korea-based NDAA-compliant cell production from 200,000 cells a year to 1 million cells a year in about 1 month. And we expect to start producing at 1 million cells a year full speed starting this Q4. We have already hosted many of the largest American and allied drone makers for line audits, with many more in the queue later this year. We expect revenue contributions from NDAA-compliant cells produced in our Korea line to start in a meaningful way in Q4 this year and really start to take off first half next year. Even at 1 million NDAA-compliant pouch cells, which we believe is 1 of the largest NDAA-compliant pouch manufacturing capacities in the world, and combined with our best in class energy density and performance, we are looking at securing orders well into 2028. And we're also seeking additional NDAA-compliant manufacturing capacities for both pouch and cylindrical cells to address the strong demand for these products. These cells will be for drones, but also broader unmanned and mobility applications. We recently announced a framework agreement with Doroni, where we'll be responsible for designing and developing the complete battery pack for their H1-X eVTOL. It's a really cool 2-seater. With Molecular Universe, we released MU-3.0. This is the most powerful and complete end-to-end workflow automation in energy storage. We sold a Search-in-a-Box module to one of the largest battery makers in the world, and we are trialing full MU-3.0 workflow integrated with autonomous labs with many more. We do have competitors for AI for materials, but none offers solutions as complete, accurate, and most importantly, secure as ours. And many of our customers switched to MU after trying our competitors offerings. Many of our competitors try to offer building blocks in a cloud-based toolkit, but product development is more than a toolkit. And very few enterprise customers would allow their proprietary data to leave their premises or be used to train external models. It requires a fully secured on-premise integration of domain expertise, experimental data, and computation chemistry simulation full stack. Some of the materials discovered by Molecular Universe have completed testing and entered revenue generating early stage commercial pilot development. We expect to release MU-4.0 later this year. It will feature ability to generate new molecules based on desired properties, and it will be integrated with autonomous labs. So users can generate or discover new molecules, synthesize them, validate them in full devices, and provide actual experimental data back to train their own foundation models, all fully secured on-premise. This flywheel connects similar technologies simulation with experimental validation can organize and generate high quality data and train models fully secured and on-premise. And without humans in the loop, it can run much faster than humans ever can. I do think a lot of investors are underestimating Molecular Universe, especially purely through the lens of near-term monetization. But I believe in the next 3 to 5 years, Molecular Universe will power majority of product development, definitely in energy storage and expanding to complex fluids and eventually other material applications. The SES team is solving 2 of the most difficult challenges in energy storage, accelerating product development using AI for materials and building a robust supply chain to manufacture these products. We have a healthy cash runway, highly differentiated capability across products and manufacturing, and one of the most dedicated teams. I'm incredibly proud to work with our team on these critical challenges, even when the market may perhaps underestimate us. And I'd like to thank the team for their hard work. Now here's Ray for the financial updates. Yi Liu: Thank you, Qichao. I'll walk through our second quarter 2026 financial results. Second quarter revenue was $5.1 million compared to $6.7 million in the first quarter of 2026 and $3.5 million in the second quarter of 2025. Notably, this quarter validated our commercial momentum. For the first time, we saw revenue contribution across all product lines. ESS, drone battery cells, materials, and Molecular Universe. Our GAAP gross margin was 22.6% in the quarter, an improvement from 18.1% in the first quarter. The improvement was particularly driven by the ESS business, where we saw a higher mix of international sales and continued pricing discipline. Turning to operating expenses, our GAAP operating expenses for the second quarter were $20.3 million compared to $19.1 million in the first quarter. The slight sequential increase was primarily due to a bad debt provision related to a legacy EV service contract. Year over year, however, operating expenses were down 26% and we remain confident in our ability to sustain the expense reduction of more than 20% year-over-year. Our GAAP net loss for the second quarter was $17.8 million, or $0.05 loss per share, compared to a GAAP net loss of $12.1 million, or $0.04 loss per share in the first quarter. I want to remind everyone that our GAAP net loss can be impacted by non-cash mark-to-market movement in the fair value of our sponsor earn-out liabilities, which are required to be measured each reporting period under GAAP. In the first quarter, we recorded a $4.2 million non-cash gain related to these liabilities. That impact was insignificant in the second quarter. Excluding change in sponsor earn out liabilities, stock based compensation, depreciation and amortization, and including interest income. Our non-GAAP net loss for the second quarter was $13.1 million, or $0.04 loss per share, compared to a non-GAAP net loss of $11.1 million, or $0.03 loss per share in the first quarter. The sequential widening in non-GAAP net loss was primarily due to lower revenue in the second quarter and the bad debt provision that I mentioned earlier. Looking ahead, we expect our net loss to narrow in the second half of the year, driven by a pickup in revenue and continued reductions in operating expenses as our cost reduction program takes full effect. Adjusted EBITDA for the second quarter was a loss of $14.6 million compared to a loss of $12.8 million in the first quarter. A detailed reconciliation of GAAP net loss to adjusted EBITDA and non-GAAP net loss is included in the financial tables at the end of the shareholder letter. Turning to capital allocation, we ended the second quarter with cash, cash equivalents and short-term investments of approximately $163 million. Our CapEx light business model remains a core financial discipline and we're confident our current liquidity provides a runway to fund operations and execute on our 2026 growth initiatives. We're actively looking for inorganic growth opportunities, including M&A that complement our strategy, while maintaining financial discipline. We believe the second quarter demonstrates continued execution against the plan we laid out, broadening revenue contribution across all our products, continued gross margin improvement, and disciplined cost management. We are reaffirming our full year 2026 revenue guidance of $30 to $35 million. As we look to the second half of the year, our priorities are clear. Continue to scale energy storage systems and Edge Box distribution. Convert our drone qualification pipeline into commercial orders as the Chungju ramp completes and close our supply agreement for materials discovered through Molecular Universe. With that, I will hand over to the operator. Operator: [Operator Instructions] Your first question comes from the line of Winnie Dong with Deutsche Bank. Your line is open. Please go ahead. Yan Dong: I wanted to touch on the back half of this year, if you can remind a mix of revenue that's going to be driven by across the different business lines. And then you can also talk about the backlog at the energy sentiment. It seems like you've got some important certifications that might be good for the U.S. side. What kind of demand management might we be looking at for 2027? And then I have a follow up. Thanks. Qichao Hu: In terms of the split. First half is basically majority ESS, almost more than 70% ESS. But in the second half, we do expect drones and materials to pick up. So still more than half from ESS. And then in terms of that certification with Sol-Ark, so basically if you're not certified, then you're competing with like 20 other companies. But once you are certified and there's only like less than 5, there's like Enphase, there's Tesla, there's Sol-Ark, then really you're competing with like 3. So later half of this year, we expect the hockey stick to start to pick up and then a lot more next year. I think the exact number, we don't have the exact number yet, but we're quite excited to be certified by Sol-Ark. Because now we go from competing with 20 other players to now competing with just 1. Like Enphase and Tesla. Yan Dong: Ok, thank you. That's helpful. And then I was wondering, maybe just like on the capital allocation side, it seems that you're just sort of like sticking with that CapEx like approach. You do have, you know, $160 plus million cash runway. What kind of CapEx might you be looking to do to spend it on? And you also alluded to M&A. What are some of the pipelines that you're looking at? What can we anticipate? I think if I look back to the capacity you have for your drone cells out of Korea, it seems like there is demand and order into 2028. So would you need capacity expansion there and the use of CapEx for that? Thanks. Qichao Hu: We definitely do. I mean, if we just had 1 million cells out of Korea, then literally we're going to supply like at most 3 customers, 3 drone customers that need NDAA. Like most. So without additional capacity and based on this pipeline, we are looking at 2028. Now if we can double the capacity in Korea to 2 million or triple that or find additional NDAA-compliant capacity in Southeast Asia, so if we quadruple or even more that capacity, and all that pipeline that we were going to supply in 2028, now we can supply in 2027. So in terms of line, not so much this year because most of that has already been spent. And then again, most of the Korea CapEx, we built that back in, you know, in the early during the JDA with GM. So now it's not rebuilding new CapEx, it is more modifying that. So not as much this year. And then later this year or next year, if we're to invest in additional CapEx, either through direct investment or through investing in or companies that own those CapEx. I think that's TBD, but again, for drones, we're not talking about gigawatt hours scale. We're talking about, for example, 20 megawatt hours, 50 megawatt hours, like way smaller than gigawatt hours. So I think the spending is a lot more efficient than the EV CapEx. Yan Dong: Thank you. And then what about the M&A portion? Any pipelines that you might be looking at? Anything that we should sort of anticipate? Qichao Hu: We are exploring. I think there are some companies that have interesting manufacturing capacities in Korea in the drone space, in the ESS space. Companies that make pouch cells for drones or prismatic LFP, we're very interested in working with them, both cell companies as well as pack companies. We are still evaluating some of those capacities. Yi Liu: Yes. We internally, we set up some-- I just want to add internal guardrails on doing M&A. So anything we want to do is kind of fit into our strategy. And also it's going to be business and revenue accretion to our business. So we're just looking to, as Qichao was mentioning, expand with the cash we have on hand. Operator: Your next question comes from the line of Dave Storms with Stonegate. Your line is open. Please go ahead. David Storms: Just wanted to maybe start with your comments around the expected gross margin improvement. Could you help us understand maybe what might be driving this? Is this going to be continued on pricing? Is this, you know, volume increases, mixes, you're moving into more drones in the back half? Just any further color here would be great. Yi Liu: Yes, I can add some color. I think the improvement, as I mentioned in the announcement, is primarily from our ESS business that's mostly driven by kind of increased international sales. We typically, especially in the North America, particularly see a higher margin on the sales in North America. Additionally, we have maintained a price discipline on the ESS business. So that's contributed. I think a back half of the year like I said, as the drone revenue picks up, we'll see margin increase because a drone sale typically carries a higher margin compared to the ESS business. So we'll see margin improvements in the second half. Qichao Hu: Yes, I think one of the key drivers to the gross margin is, especially in ESS, is the price of the cells. A year ago, cells were really expensive and we did not have Edge Box. So we were required to buy cells produced by one vendor out of one of their lines. So we have very little pricing. And since we have Edge Box, now we're able to source cells from multiple vendors and multiple lines because we're able to monitor and then balance between the cells. So that has reduced the price of cells. David Storms: That's great commentary. I really appreciate that. Maybe, Qichao, if you want to, you know, you mentioned that you are exploring beyond drones, you know, the broader unmanned and mobility applications, you called out a new partnership there. I think you could spend a little bit time talking about maybe some of the technical challenges between drones versus the broader unmanned ecosystem, if there are any. Maybe how that market looks in terms of margins or demand or TAM compared to your current market. Anything else there would be very helpful. Qichao Hu: So a lot of it is just timing and then go to market investment and also timing. And then we focus on drones because that market we have seen that it's consolidating around 1 up to 3 major form factors and then so the cells we build, we definitely first and foremost supply to drones. Now there are other applications that recently have surfaced marine applications, boats, submarines, applications that also care about weight, NDAA compliance, as well as some of the cargo planes, manned eVTOLs as well as unmanned eVTOLs. So all of the form factors that we have matured for drone applications, we're also selling those to the other adjacent markets. Operator: Your next call comes from the line of Craig Irwin with ROTH Capital. Your line is open. Please go ahead. Craig Irwin: So I wanted to ask about Molecular Universe. So, Qichao, you're clearly excited about this as a longer-term opportunity and the potential both revenue and IP out of the library that you've developed. Can you maybe talk about customer engagement? How actively are you marketing this to new customers at the moment? Do you have strong leads for additional new customers at the moment? If you could maybe give us a little color on the breadth of the customer interest. And how long do you think it will take as far as customers that are already, you know, looking for leads out of your database to make those commercial and have those revenue generating opportunities. Qichao Hu: So I would say we have about 3 customers, 3 battery companies that we are deeply engaged with. And then when I say deeply, I mean there's at least 3 to 5 teams within each company that are evaluating different parts of the Molecular Universe. So the entry level basically ones that buy modules, for example, you mentioned Search-in-a-Box, some people buy Predict-in-a-Box, some people buy Design-in-a-Box, some buy Ask-in-a-Box, some buy Formulate-in-a-Box. So that's the entry level. Companies buy these modules. Second level companies will buy the entire workflow, ask, search, predict, design, manufacture, basically this entire workflow and also with StarSeeker. So it's a agentic workflow. And then the third tier companies that buy what we call M-Labs. So M-Labs is the integration of the entire agentic StarSeeker with autonomous labs. So we will actually combine the StarSeeker with corresponding autonomous labs. So for example, Ask and Search is integrated with a new molecule synthesis, A-Lab. Formulate is integrated with Electrolyte A-Lab. Design and Predict are integrated with Electrolyte Optimization A-Lab. Also part of Predict is integrated with Cell Testing A-Lab. Before we had pure software platforms installed on-premise and instead of having this pure software in a box delivered on-premise, now the software is delivered together with a lab. So a customer could just provide us 1,000 to 1,500 square meters of space, and then we will lay out all the other A-Labs and the corresponding software. So on the customer side, instead of needing 30 people, 50 people to run this lab, now you need just one PM, one project manager with this entire software and this entire A-Lab together, M-Labs, and then you can have a complete battery. So there are 3 major customers that we are outlining I would say at the third tier discussion. So hopefully we'll announce some revenues at the M-Labs level. And then beyond these 3, there are also other battery companies that we are in the module level and the workflow level. Craig Irwin: Okay, excellent. I understood. My second question is about the cells coming online in Korea. So you're going from 200,000 cells a year in capacity to 1 million cells a year in capacity. And you know, when I look at your current capacity of 200,000 cells, you know, that's quite small versus the needs of a lot of the defense suppliers, the drone producers and other companies that use lithium-ion batteries in military equipment. But 1 million cells, 1 million cells a year sort of gets you in the game. Have you received any sort of soft commitments from these NDAA-constrained customers, the defense market customers, as far as probable orders or potential orders on that 1 million cells a year, what's your confidence level that you'll see the offtake there? And actually, I guess another question is, is it possible we see revenue from the incremental capacity at the end of this current quarter within the month of September? Qichao Hu: Yes, so total our pipeline for drones for just NDAA, not counting the non-NDAA, we're talking about 50 plus, just all NDAA. And then the large customers, and we define large customers, are the ones that need a pipeline to sell 200,000 to 300,000 NDAA-compliant cells a year. So we have maybe 5 large customers. So just the top 5 large customers, we've already exceeded 1 million. We're at like 1.5 million, right? And then 1 million is the capacity, if you take into account some qualities, some downtimes, this and that, probably we deliver 700,000, 800,000. So, yes, we are way under capacity purely in terms of NDAA compliance. Now, we're doing 2 things. One is we are evaluating other capacities in Korea, either through our own investment or through contract manufacturing, so that we are hoping to double, maybe triple the NDAA-compliant capacity in Korea. And we're also looking at additional capacities in Southeast Asia. This is 1. The customers do have a range, a spectrum of NDAA compliance. We have ones that want 100% NDAA compliance, means cathode, anode, electrolyte separator, pouch, and entire assembly. Everything must be done in Korea, completely NDAA-compliant. We also have customers that are okay with 40% NDAA-compliant, 50% NDAA-compliant. In some cases, Korea's own Article 1, Article 2 compliance where you can have cathode from Korea, anode from Korea, but then cell assembly done in China just for 1 year. So we reserve the 1 million capacity in Korea purely for those that want 100% NDAA-compliant. And then we do have additional capacity for those that want maybe 40%, 50%, 60% NDAA-compliant. So we do have alternative capacities for those that don't want 100% NDAA compliance, but some portion of NDAA compliance as well as we're looking for additional capacities in Korea and Southeast Asia. Craig Irwin: Thank you for that. And my last question is, you know, you're increasing capacity or increasing your capacity commitment there five-fold. I do realize that you're using contract manufacturing, so probably you don't see as big a potential improvement in cost. Is there an improvement in cost that you can expect on this capacity increase? And the 5 customers that are very large in the drone market that you mentioned, have they already started sampling cells, given that you're going to be using nearly identical production, identical cell recipe, to produce a commercial product? Qichao Hu: So I just want to confirm that 1 million 100% NDAA-compliant cells out of Korea, those are entirely our own production. And then we have several other million less than 100% NDAA-compliant. Those are through contract manufacturers. And then in terms of where we are with the customers, they've done sample testing, multiple rounds. They've done a line audit, 1 to 2 rounds. And then they're waiting for that 1 million cell capacity to be operational in September and then visit again for additional quality audits. And in terms of pricing, yes, going from 200,000 to 1 million would significantly reduce the price. Craig Irwin: Excellent. Well, thank you for that, and thank you for the clarification. Congratulations on your progress. Operator: Your next question comes from the line of Mark Shooter with William Blair. Your line is open. Please go ahead. Mark Shooter: Hey, Qichao. Qichao, am I coming through? Qichao Hu: Yes, we're here. Mark Shooter: Great, thank you. On the ESS business. I'm interested in if you can update us and give us a little bit of color on exactly what niche of this segment you're looking to play in ideally. And can you update us on if you are still trying to sell product that is the full solution including the battery and the DMS or Edge Box or is there an opportunity to just sell the Edge Box to potentially a utility or an integrator? Qichao Hu: Yes, so I would divide them into 3 categories. One is just residential and then there's new certification. So in residential, most companies buy batteries and inverters in one pack, right? Like people don't really just buy a battery or just buy an inverter. You buy those types to connect it together. So recently when some of those foreign produced inverters got blocked, that did also impact their co-op sale, co-marketing relationship for the battery suppliers because those 2 are sold a lot of times together. And then this partnership with Sol-Ark is one of the 3 along with Enphase and Tesla that have U.S. produced inverters. So this will help the residential. And then yes, we do include the Edge Box there. And then second is more larger scale data centers. This is quite new for us. This is not an area that UZ was in. UZ was familiar with a residential, not so much in AIDC. So here, we are trying to provide a total solution. So the entire UPS, sometimes it's the best, together with the Edge Box. This is also why we brought on Paul, to help us navigate the go-to-market strategy here. And then third one, some of the battery inverter distributors are open to us installing the Edge Box and we are testing with them. And then that may also pick up as a revenue source. Mark Shooter: Thank you. I'm talking about that second piece, which is the hyperscalers. Is there anything available or that you're ready to update us on that and give us a little bit more detail on the level of engagement? Qichao Hu: Yes, I think we can discuss and share more in Q3 or Q4. I think now a lot of those are very early. Mark Shooter: Okay, understood. Thought I would try. Also, in the shareholder letter, you mentioned that most competitors just sell hardware without software. The competitors I'm thinking of have very complex and sophisticated software programs attached. So who do you consider your key competitors in this space? Qichao Hu: So I think the, yes, I think some of the competitors that you're thinking of, they do, and the large ones, they do. But I think for the majority, they either use like a third party software or they use an internal software that's not specifically trained on those cells. So for example, say the PAC system is using a 314 amp-hour LFP prismatic produced Q1 this year out of a line from the, say CATL or EVE. So our Edge Box will be trained on that batch of cells, like literally the exact batch of cells that go inside the pack. And then if we switch to even a different vendor that makes the same 314 amp-hour LFP prismatic, we will retrain the software. So the software gets retrained on the specific cell, the specific vendor, the specific chemistry that we actually put inside the pack. Operator: There appear to be no further questions at this time. This concludes today's call. Thank you for attending. You may now disconnect. Before you buy stock in Ses Ai, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Ses Ai wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. SES AI (SES) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management attributed the 40% year-over-year revenue growth to a successful strategic pivot from EV applications to Energy Storage Systems (ESS) and drone markets. Gross margin expansion to 22.6% was driven by pricing discipline and a higher mix of international sales within the ESS segment. The company is utilizing its Edge Box technology to source cells from multiple vendors, reducing dependency on single-line pricing and improving supply chain flexibility. Molecular Universe MU-3.0 was launched as an agentic workflow platform to accelerate material discovery for both sodium and lithium chemistries. Management emphasized that their AI platform offers a competitive advantage through fully secured, on-premise integration, addressing enterprise concerns regarding proprietary data privacy. The ESS strategy is shifting toward total solutions for AI data centers, supported by new board expertise from the power electronics industry. Reaffirmed full-year 2026 revenue guidance of $30 to $35 million, with expectations for a 'hockey stick' growth curve in the second half of the year. Management expects to scale Korea-based NDAA-compliant cell production from 200,000 to 1 million cells per year by Q4 2026 to meet strong defense demand. Future revenue growth is contingent on converting a pipeline of over 50 NDAA-compliant drone customers into commercial orders, with some orders already secured into 2028. The company is evaluating additional manufacturing capacities in Southeast Asia and Korea to potentially pull forward 2028 demand into 2027. Molecular Universe MU-4.0 is slated for release later this year, featuring autonomous lab integration and generative capabilities for new molecules. A bad debt provision related to a legacy EV service contract caused a slight sequential increase in operating expenses despite an overall 26% year-over-year reduction. The company maintains a cash position of approximately $163 million, which management believes provides sufficient runway for current growth initiatives. Management is actively exploring inorganic growth opportunities, specifically targeting manufacturing capacities in Korea and Southeast Asia that are business and revenue accretive. Recent FCC restrictions on foreign-produced inverters are expected to accelerate U.S. demand for SES's certified residential battery solutions. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. First-half revenue was over 70% ESS, but drones and materials are expected to contribute significantly more in the second half. Certification with Sol-Ark reduces the competitive field from approximately 20 players to just 3 major competitors in the U.S. residential market. Current capacity of 1 million cells is insufficient for the pipeline; management is looking to double or triple capacity through M&A or contract manufacturing. Drone manufacturing is significantly more CapEx-efficient than EV manufacturing because it does not require gigawatt-hour scale to be viable. Engagement is categorized into three tiers: module sales, full workflow automation, and 'M-Labs' which integrates software with physical autonomous labs. Three major battery companies are currently in deep discussions for the highest-tier 'M-Labs' integration. Management offers a spectrum of compliance, reserving the 1 million cell Korea line for customers requiring 100% NDAA-compliant components. Alternative capacities are utilized for customers who only require 40% to 60% NDAA compliance, allowing for more flexible supply chain sourcing.

Interested in SES AI Corporation? Here are five stocks we like better. SES AI’s second-quarter revenue rose more than 40% year over year to $5.1 million, and the company reaffirmed full-year guidance of $30 million to $35 million. Gross margin improved to 22.6%, although the net loss widened to $17.8 million and adjusted EBITDA remained negative. The company expects its Korea facility’s NDAA-compliant drone-cell production to reach an annualized 1 million cells in the fourth quarter, supporting meaningful drone revenue late this year and accelerating growth in the first half of 2027. SES also signed an agreement to develop the battery pack for Doroni’s H1-X eVTOL aircraft. SES is expanding its energy-storage and AI strategy through Sol-Ark certification for UZ Energy residential batteries and the launch of Molecular Universe 3.0, which integrates materials discovery with autonomous laboratories. Management also sees potential growth in larger-scale data-center energy-storage applications. 3 Defense Stocks Under $20 With Massive Upside SES AI (NYSE:SES) reported second-quarter 2026 revenue of $5.1 million, up more than 40% from $3.5 million in the prior-year quarter, while reaffirming full-year revenue guidance of $30 million to $35 million. The company said revenue during the quarter included contributions from its energy storage systems, drone battery cells, materials and Molecular Universe artificial-intelligence platform for the first time. Founder and Chief Executive Officer Qichao Hu said the company’s strategy centers on using AI to accelerate materials development while building manufacturing and supply-chain capabilities for energy-storage products. SES previously focused on electric vehicles but shifted more than a year ago toward energy storage systems, drones and unmanned applications. → SoundHound AI Sends a Loud Signal After Its Q2 Earnings Beat 5 EV Battery and Lithium Stocks Charging the Future SES reported GAAP gross margin of 22.6% for the second quarter, compared with 18.1% in the first quarter. Chief Financial Officer Ray Liu attributed the improvement primarily to the energy storage systems, or ESS, business, including a higher mix of international sales and pricing discipline. Revenue declined sequentially from $6.7 million in the first quarter, though Liu said the company expects drone and materials revenue to increase in the second half while ESS remains more than half of total revenue. ESS represented more than 70% of first-half revenue, he said. → 3 Dividend Champion Utilities for a Market That Can't Sit Still SES posted a GAAP net loss of $17.8 million, or $0.05 per share, compared with a $12.1 million loss, or $0.04 per share, in the first quarter. Operating expenses were $20.3 million, up from $19.1 million sequentially, primarily because of a bad-debt provision related to a legacy EV service contract. Operating expenses were down 26% from a year earlier. On a non-GAAP basis, excluding items including changes in sponsor earnout liabilities, stock-based compensation, depreciation and amortization, SES reported a net loss of $13.1 million, or $0.04 per share, versus a $11.1 million loss in the first quarter. Adjusted EBITDA was a loss of $14.6 million, compared with a $12.8 million loss in the prior quarter. → Is Wingstop's Growth Story Losing Steam? The company ended the quarter with approximately $163 million in cash equivalents and short-term investments. Liu said SES expects losses to narrow during the second half as revenue rises and its cost-reduction program takes fuller effect. SES said Sol-Ark, a U.S.-based FCC-authorized inverter producer, certified subsidiary UZ Energy’s low-voltage residential batteries for use with its hybrid inverter systems. Hu said the certification could support U.S. growth, particularly amid restrictions affecting some foreign-produced inverters and electronics. Liu said certification reduces the number of competitors SES faces in the residential market. He said the company expects growth to begin accelerating in the latter half of 2026 and increase further next year, though management did not provide a specific revenue forecast for the Sol-Ark relationship. The company is positioning its Edge Box software alongside ESS hardware. Hu said the software is trained on the specific cells used in a given battery system, which SES believes enables more accurate monitoring of state of health and safety management. He added that the company can source cells from multiple suppliers and production lines because Edge Box can monitor and balance between cells, improving its purchasing leverage. SES also appointed Paul Diemer, former chief technology officer of Flex Power, to its board. Hu said Diemer’s background in embedded power solutions for data centers and industrial systems will help guide the company’s ESS strategy, including its pursuit of larger-scale data-center applications. SES expects to complete the expansion of its Korea-based production of NDAA-compliant cells from 200,000 cells annually to 1 million cells annually in about one month. Hu said the facility is expected to operate at the 1 million-cell annual rate beginning in the fourth quarter. Management expects meaningful revenue from the Korea-produced cells to begin in the fourth quarter and to accelerate in the first half of 2027. Hu said the company has hosted line audits for several large U.S. and allied drone manufacturers and has additional customers scheduled for audits later this year. According to Hu, SES has identified more than 50 drone opportunities requiring NDAA-compliant products. He said five larger potential customers alone represent demand above 1 million cells annually, while expected usable capacity after accounting for quality and downtime could be roughly 700,000 to 800,000 cells. The company is evaluating additional compliant manufacturing capacity in Korea and Southeast Asia, potentially through direct investment, joint ventures, acquisitions or contract manufacturing. Hu said drone-related capacity additions would be measured in tens of megawatt-hours rather than gigawatt-hours, making the required spending more efficient than EV-scale manufacturing investment. SES also announced a framework agreement with Doroni under which it will design and develop the complete battery pack for Doroni’s H1-X two-seat eVTOL aircraft. Management said drone cell formats may also serve adjacent marine, cargo aircraft and manned and unmanned eVTOL applications. SES released Molecular Universe 3.0, an agentic workflow platform designed for sodium and lithium chemistries that can be deployed on customer premises and integrated with autonomous laboratories. The company said it shipped its first Search-in-a-Box module to one of the world’s largest battery manufacturers. Hu said materials discovered through Molecular Universe have completed testing and entered early-stage commercial pilot development. He described three battery-company customers as being in advanced discussions around broader deployments combining the software with autonomous lab equipment, while other customers are evaluating individual modules or full workflow tools. The company expects to release Molecular Universe 4.0 later this year. Hu said the planned version will add molecule-generation capabilities based on desired properties and expand integration with autonomous labs, allowing users to generate, synthesize and validate materials while feeding experimental data back into on-premise models. SES AI Corporation engages in the development and production of high-performance Lithium-metal rechargeable batteries for electric vehicles, electric vehicle take-off and landing, and other applications. The company was founded in 2012 and is headquartered in Woburn, Massachusetts. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "SES AI Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Reports second quarter revenue of $5.1 million Improved second quarter gross margin to 22.3% UZ Energy named certified battery partner by Sol-Ark, a top U.S. inverter producer Paul Diemer, ex-CTO of Flex Power, Added to Board of Directors Maintained strong liquidity position with approximately $163 million Affirmed full year 2026 revenue guidance of $30 million to $35 million Highlights Reported $5.1 million revenue in the second quarter 2026, compared to $6.7 million in the first quarter 2026 GAAP net loss in the second quarter 2026 of $17.8 million, or $0.05 loss per share, compared to a GAAP net loss of $12.1 million, or $0.04 loss per share in the first quarter 2026 Non-GAAP net loss in the second quarter 2026 of $13.1 million, or $0.04 loss per share, compared to a non-GAAP loss of $11.1 million, or $0.03 loss per share in the first quarter 2026 Gross margin improved to 22.3% in the second quarter 2026, from 18.1% in the first quarter 2026 Materials contributed $1.2 million in revenue in the second quarter 2026 Molecular Universe’s "Search in a Box" generated revenue from a multi-year subscription commitment with a major global battery manufacturer Sol-Ark’s certification of UZ Energy opens a large and established residential energy storage ecosystem and creates an immediate path to compete for U.S. battery sales Affirmed previously issued full year 2026 revenue guidance in a range of $30 million to $35 million WOBURN, Mass., August 11, 2026--(BUSINESS WIRE)--SES AI Corporation ("SES AI") (NYSE: SES), a global leader in the development and manufacturing of AI-enhanced high-performance Li-Metal and Li-ion batteries, today announced its business results for the second quarter ended June 30, 2026 and affirmed its previously issued financial guidance for the year ending December 31, 2026. The Company posted a Letter to Our Shareholders on its Investor Relations website, which provides a business update, details on its second quarter 2026 results, and its guidance for 2026. Dr. Qichao Hu, Founder and CEO of SES AI, noted, "SES is solving two of the most difficult challenges in energy storage – accelerating product development using AI4Materials and building a robust supply chain to manufacture these products. In the second quarter, we began seeing significant commercial milestones, and we are very excited about the path we are on. For ESS, this is our largest revenue generating unit. We are making great progress especially in the US market, we were selected by Sol-Ark as a certified battery partner, and we brought on Paul Diemer, ex-CTO of Flex Power, to our board to help guide our ESS strategy. We continue to hire a stellar team with backgrounds in leading AI data center total solutions providers to execute on and deliver our exciting ESS growth." "For drones and unmanned systems, we are recruiting a team that has sold to defense and commercial drones. We are just one month away from reaching the scale of 1 million NDAA-compliant cells per year in our Korea plant and are already in the process of securing orders well into 2028," stated Dr. Hu. "MU contributed its first ever revenue from a multi-year Search in a Box subscription commitment with a major global battery manufacturer, validating Molecular Universe’s commercial value." The Company will hold a conference call later today at 5:00 p.m. Eastern Time. A webcast of the live conference call will be available through SES’s Investor Relations website, https://investors.ses.ai. The following link can be used to register in advance for the call: https://events.q4inc.com/attendee/167359368. The conference call can also be accessed live over the phone by dialing the following numbers:United States (Toll Free): +1 833-461-5787International: +1 626-884-3620https://events.q4inc.com/attendee/167359368 Access Code: 167359368 A webcast replay will be available shortly after the call at: https://investors.ses.ai/events-and-presentations/events/default.aspx About SES AI: SES AI Corp. (NYSE: SES) is powering the future of global electric transportation with the world’s most advanced Li-Metal batteries. SES AI is the first battery company in the world to accelerate its pace of innovation by utilizing superintelligent AI across the spectrum of its business, from research and development; materials sourcing; cell design; engineering and manufacturing; to battery health and safety monitoring. Founded in 2012, SES AI is an Li-Metal battery developer and manufacturer headquartered in Boston and with operations in Singapore, China, and South Korea. Learn more at SES.AI. SES AI may use its website as a distribution channel of material company information. Financial and other important information regarding SES AI is routinely posted on and accessible through the Company’s website at www.ses.ai. Accordingly, investors should monitor this channel, in addition to following SES AI’s press releases, Securities and Exchange Commission filings and public conference calls and webcasts. Non-GAAP Financial Measures This press release includes the use of non-GAAP financial measures, which are intended to provide supplemental information regarding our performance. These non-GAAP measures include Gross profit (Non-GAAP), Gross margin (Non-GAAP), Operating expenses (Non-GAAP), Loss from operations (Non-GAAP), EBITDA, adjusted EBITDA, Net loss (Non-GAAP) attributable to SES shareholders, and Earnings per share (Non-GAAP). We use these non-GAAP measures to supplement our financial reporting and to evaluate ongoing operations and results, facilitate internal planning and forecasting, and assess performance against prior periods, industry peers, and the broader market. These non-GAAP measures are not prepared in accordance with generally accepted accounting principles (GAAP) and should not be considered as an alternative to GAAP results. Industry peers and other companies may calculate similar non-GAAP measures differently. Non-GAAP financial measures have limitations, including that they exclude the impact of certain items that are included in the most directly comparable measure calculated and presented in accordance with GAAP, which adjustments reflect the exercise of judgment by management. We believe that these non-GAAP measures, when considered together with the GAAP results, provide investors with an additional understanding of our operating performance. Reconciliations of each non-GAAP financial measure to the most directly comparable GAAP financial measure can be found in the supplemental non-GAAP information section at the end of this press release. As presented in the "Reconciliation of Non-GAAP Financial Measures" tables below, each of the non-GAAP financial measures excludes the impact of one or more of the following items for purposes of calculating non-GAAP financial measures to facilitate an evaluation of SES’s current operating performance and a comparison to its past operating performance: Stock-based compensation expense. SES excludes the impact of stock-based compensation expense from its non-GAAP measures primarily because they are non-cash in nature. Moreover, the impact of this expense is significantly affected by SES’s stock price at the time of an award, which can be volatile and over which management has limited to no control. Depreciation and amortization. This item represents depreciation and amortization of purchased long-lived assets and acquired intangible assets, which are both non-cash expenses. Acquisition related amortization of acquired intangible assets are not reflective of SES’s ongoing financial performance. Interest income. This item consists primarily of interest income on short term debt securities that primarily includes accretion income from the debt securities as they progress towards their maturity date. Benefit (provision) from income taxes. This item represents the amount adjusted to SES’s GAAP tax provision or benefit to exclude the impact of the income tax effects of GAAP adjustments that are not reflective of SES’s ongoing financial performance. (Loss) gain on change in fair value of Sponsor Earn-Out Liability. This item represents the amount adjusted to SES’s GAAP fair value liability for Sponsor Earn-Out shares, which is a non-cash adjustment that is more tied to the change in stock price rather than management’s operational performance. Definitions Gross profit (Non-GAAP), Gross margin (Non-GAAP), Operating expenses (Non-GAAP), and Loss from operations (Non-GAAP) represent, in each case, the corresponding GAAP financial measure adjusted to exclude the impact of stock-based compensation expense and depreciation and amortization. EBITDA represents net loss attributable to SES shareholders adjusted to exclude the impact of interest income, taxes, depreciation and amortization. Adjusted EBITDA represents EBITDA adjusted to exclude the impact of loss (gain) on change in fair value of Sponsor Earn-Out liability and stock-based compensation. Net loss (Non-GAAP) attributable to SES shareholders represents Adjusted EBITDA adjusted further to reinclude the impact of interest income. Earnings per share (Non-GAAP) represents earnings (loss) per share adjusted to exclude the impact of taxes, depreciation and amortization, loss (gain) on change in fair value of Sponsor Earn-Out liability and stock-based compensation. Forward-Looking Statements This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, about us and our industry that involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as "will," "goal," "prioritize," "plan," "target," "expect," "focus," "look forward," "opportunity," "believe," "estimate," "continue," "anticipate," "project" and "pursue" or the negative of these terms or similar expressions. These statements are based on the beliefs and assumptions of the management of the Company. You should not place undue reliance on these forward-looking statements. Although the Company believes that its plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, it cannot provide assurance that it will achieve or realize these plans, intentions or expectations. Should one or more of a number of known and unknown risks and uncertainties materialize, or should any of our assumptions prove incorrect, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include, but are not limited to, among other things, the risk that the market for the Molecular Universe platform is still emerging, and may not achieve the customer interest or growth potential that SES AI expects; risks related to the development and commercialization of SES AI’s battery technology and the timing and achievement of expected business milestones; risks relating to the uncertainty of achieving and maintaining profitability; risks relating to the uncertainty of meeting future capital requirements; risks relating to the integration of Shenzhen UZ Energy Co., Ltd. into the business of SES; the market for drones, robotics and air mobility, and for use of SES technology in such applications, is still emerging and may not achieve the growth potential we expect; we may be unable to secure the level of drone cell orders we expect from our NDAA-compliant line in Korea; potential supply chain difficulties; the ability to obtain raw materials, components or equipment through new or existing supply relationships; our use of artificial intelligence and machine learning may result in legal and regulatory risk; risks resulting from SES’s strategic alliances and investments; product liability and other potential litigation, regulation and legal compliance; SES’s ability to attract, train and retain highly skilled employees and key personnel; developments in alternative technology or other fossil fuel alternatives; risks related to SES’s intellectual property; business, regulatory, political, operational, financial and economic risks related to SES’s business operations outside the United States; SES’s failure to satisfy certain NYSE listing requirements may result in its Class A common stock or public warrants being delisted from the NYSE, which could eliminate or adversely affect the trading market for SES Class A common stock or public warrants; the volatility of SES’s common stock and value of SES’s public warrants; SES has, in the past, identified material weaknesses in its internal control over financial reporting and may identify material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, and other factors described in our filings with the Securities and Exchange Commission (the "SEC"), including in the "Risk Factors" and "Management’s Discussion and Analysis of Financial Condition and Results of Operations" sections of our most recently filed Annual Report on Form 10-K, Quarterly Report on Form 10-Q and other documents that we have filed, or that we will file, with the SEC. Any forward-looking statements made by us in this press release speak only as of the date on which they are made and subsequent events may cause these expectations to change. We disclaim any obligations to update or alter these forward-looking statements in the future, whether as a result of new information, future events or otherwise, except as required by law. View source version on businesswire.com: https://www.businesswire.com/news/home/20260811476492/en/ Contacts For the media: [email protected] For investors: [email protected]

The market expects SES AI Corporation (SES) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended June 2026. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates. The earnings report, which is expected to be released on August 11, might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower. While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise. This company is expected to post quarterly loss of $0.05 per share in its upcoming report, which represents a year-over-year change of +28.6%. Revenues are expected to be $5.84 million, up 65.4% from the year-ago quarter. The consensus EPS estimate for the quarter has been revised 0.08% lower over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction). The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For SES AI, the Most Accurate Estimate is higher than the Zacks Consensus Estimate, suggesting that analysts have recently become bullish on the company's earnings prospects. This has resulted in an Earnings ESP of +11.11%. On the other hand, the stock currently carries a Zacks Rank of #2. So, this combination indicates that SES AI will most likely beat the consensus EPS estimate. Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that SES AI would post a loss of$0.01 per share when it actually produced a loss of -$0.03, delivering a surprise of -200.00%. Over the last four quarters, the company has beaten consensus EPS estimates just once. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. SES AI appears a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. Among the stocks in the Zacks Automotive - Original Equipment industry, Atmus Filtration Technologies (ATMU), is soon expected to post earnings of $0.79 per share for the quarter ended June 2026. This estimate indicates a year-over-year change of +5.3%. This quarter's revenue is expected to be $510.5 million, up 12.6% from the year-ago quarter. The consensus EPS estimate for Atmus Filtration has been revised 0.7% higher over the last 30 days to the current level. However, a higher Most Accurate Estimate has resulted in an Earnings ESP of +2.53%. This Earnings ESP, combined with its Zacks Rank #2 (Buy), suggests that Atmus Filtration will most likely beat the consensus EPS estimate. The company beat consensus EPS estimates in each of the trailing four quarters. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SES AI Corporation (SES) : Free Stock Analysis Report Atmus Filtration Technologies Inc. (ATMU) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

QuantumScape QS reported a narrower-than-expected second-quarter 2026 loss and announced an ambitious move into artificial intelligence (AI) data centers. Yet the stock plunged about 13% the following day, pushing its year-to-date decline to 51%. The sharp sell-off shows that investors are no longer focused on quarterly losses alone. They want clear evidence that the company is getting closer to generating meaningful revenues. This quarter's results suggest that the goal is still some distance away. QuantumScape Corporation price-consensus-eps-surprise-chart | QuantumScape Corporation Quote The last reported quarter brought several encouraging updates. Cash and investments were $859 million, while full-year capex guidance was lowered to $27-$37 million from $40-$60 million, extending the company's cash runway. Manufacturing also improved, with the Eagle Line maintaining more than 90% core-tool uptime, customer sample shipments increasing and output expected to roughly double in the second half of 2026. On the commercial front, Honda joined as the fourth top-10 global automaker, expanding QuantumScape's OEM base, while customer billings reached $21.8 million in the first half of 2026, already exceeding all of 2025. The company also expanded into AI data centers and aerospace/defense, opening up long-term growth opportunities beyond electric vehicles. QuantumScape established three dedicated business verticals. QSEV will focus on electric vehicles, QSDC will pursue AI data centers and QSAS will address advanced applications such as aerospace and defense. This is where the optimism starts to fade. Collaboration with Honda, alongside Volkswagen, is a positive sign and shows that interest in QuantumScape's technology remains strong. Customer billings in the first half of 2026 are already ahead of all of fiscal 2025. However, billings are not the same as revenues. QuantumScape still generates virtually no GAAP revenues, and these payments depend on development milestones rather than steady customer demand. More importantly, the PowerCo partnership delivered disappointing news. Potential milestone payments were reduced to about $75 million from roughly $131 million, while a separate $130 million royalty prepayment is still tied to technical milestones yet to be achieved. That suggests PowerCo is becoming more cautious. QuantumScape reported a GAAP net loss of $98.2 million and an adjusted EBITDA loss of $64.2 million during the quarter. Management also kept its full-year adjusted EBITDA loss guidance unchanged at $250-$275 million. The consensus mark for QS’ 2026 and 2027 loss per share has also widened over the past 90 days. Image Source: Zacks Investment Research While the quarterly loss was smaller than expected, the company is still burning significant cash without meaningful recurring revenues. At the same time, QuantumScape is trying to grow in three different markets—EVs, AI data centers and aerospace/defense. This creates more opportunities, but it also means management is spreading its time and resources across multiple businesses before proving success in its core EV battery business. QuantumScape isn't the only company facing investor skepticism. Solid Power SLDP also fell 8% yesterday and is down about 50% this year. SES AI SES also dropped roughly 9% yesterday, bringing its year-to-date decline to 70%. Image Source: Zacks Investment Research The market seems to be becoming increasingly impatient with solid-state battery companies. Investors now want commercial progress and recurring revenues, not just technological milestones. QuantumScape is making progress where it matters operationally. Its manufacturing technology is improving, more automakers are showing interest, and its balance sheet remains healthy. But those positives are being overshadowed by slower commercialization, weaker support from PowerCo, the lack of recurring revenues, and continued heavy losses. While the sharp post-earnings decline may tempt bargain hunters, the stock still looks more like a value trap than a buying opportunity. It carries a Value Score of F. The business remains pre-revenue, commercialization timelines are uncertain, and key partnerships have yet to translate into recurring cash flows. Until QuantumScape turns its manufacturing progress into steady revenue and stronger partner commitments, the downside risk appears greater than the potential upside. The stock carries a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report QuantumScape Corporation (QS) : Free Stock Analysis Report SES AI Corporation (SES) : Free Stock Analysis Report Solid Power, Inc. (SLDP) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Revenue growth was primarily driven by the Energy Storage Systems (ESS) segment through UZ Energy, which benefited from strong demand in commercial and industrial sectors. The company successfully converted its South Korean manufacturing facility from EV pouch cells to drone-format cells to capitalize on the high-demand U.S. defense market. Management is leveraging a 'CapEx-light' business model, focusing on strategic partnerships like the Hisun joint venture to scale material production without heavy infrastructure investment. The Molecular Universe AI platform is being transitioned from an internal R&D tool to a direct revenue stream through 'Search-in-a-Box' subscriptions for global battery manufacturers. Strategic entry into the North American market was secured via a $20 million multi-year distribution agreement with ATG EPower, expanding the global footprint beyond Australia and Europe. Operational efficiency is being prioritized through a 15% planned reduction in full-year operating expenses, utilizing positive operating leverage as revenue scales. Full-year 2026 revenue guidance of $30 million to $35 million is reaffirmed, with the majority expected from ESS and the remainder split between drones and materials. Drone cell revenue is expected to begin in Q2 2026 and accelerate through Q3 and Q4 as customers complete supply chain audits for NDAA compliance. The South Korean facility is planned to ramp up to an annual capacity of over 1 million drone cells, representing a potential $25 million to $35 million revenue opportunity. Operating expense reductions are expected to show full-quarter impact starting in Q3 2026 as cost-management actions take full effect. Management is exploring additional NDAA-compliant manufacturing capacities in Southeast Asia to further mitigate geopolitical supply chain risks. Chief Financial Officer Jing Nealis is transitioning out of the company, with Ray Liu appointed as the successor effective April 27, 2026. A routine S-3 shelf registration statement will be filed to maintain financial flexibility as the current shelf expires in late April. GAAP net loss was significantly impacted by a $4.2 million non-cash gain related to the mark-to-market remeasurement of sponsor earn-out liabilities. The company maintains a strong liquidity position of approximately $178 million to fund 2026 growth initiatives. Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Qualification typically takes 1 to 2 quarters; most performance testing is complete, and the focus has shifted to supply chain audits at the Korea facility. Management confirmed that the facility ensures all processing, including cathode and anode powder, takes place in Korea to maintain NDAA compliance. Edgebox reduces battery estimation errors from 7-10% down to approximately 3%, allowing customers to purchase less capacity for the same performance. The on-premise nature of the tool provides data security for customers wary of cloud-based solutions and enables more competitive bidding in energy trading markets. Customers typically undergo 2 to 3 rounds of testing, with each round lasting approximately one quarter, totaling a 6 to 9-month cycle. Following testing, a final quarter is required for commercial qualification, which includes environmental and toxicity regulatory checks. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here.

Reports above consensus first quarter revenue of $6.7 million Signed multiyear ESS distribution agreement with ATG EPower Improved first quarter gross margin to 18.1% from 11.3% in fourth quarter 2025 Maintained strong liquidity position with approximately $178 million Affirms full year 2026 revenue guidance of $30 million to $35 million Highlights Reported $6.7 million in the first quarter 2026 revenue, a 47% increase over $4.6 million in the fourth quarter of 2025 GAAP net loss in the first quarter 2026 of $12.1 million, or $0.04 loss per share, compared to a GAAP net loss of $17.0 million, or $0.05 loss per share in the fourth quarter 2025 Non-GAAP net loss in the first quarter 2026 of $11.1 million, or $0.03 loss per share, compared to a non-GAAP loss of $11.8 million, or $0.04 loss per share in the fourth quarter 2025 Gross margin improved to 18.1% in the first quarter 2026, from 11.3% in the fourth quarter 2025 Entered into a $20 million multiyear distribution agreement with ATG EPower, a leading North American distributor of renewable energy and energy storage solutions Completed the conversion of the manufacturing line at the Chungju, South Korea facility from EV pouch cells to drone-format pouch cells, quickly ramping up to an annual production capacity of one million cells a year Approximately six customers have progressed through second-phase testing of materials discovered through the Molecular Universe platform Introduced Molecular Universe 2.5 – the fifth iteration since the 2024 launch Secured a multiyear commitment from a major global battery manufacturer for MU’s Search in a Box product Affirmed previously issued full year 2026 revenue guidance in a range of $30 million to $35 million WOBURN, Mass., April 23, 2026--(BUSINESS WIRE)--SES AI Corporation ("SES AI") (NYSE: SES), a global leader in the development and manufacturing of AI-enhanced high-performance Li-Metal and Li-ion batteries, today announced its business results for the first quarter ended March 31, 2026 and affirmed its previously issued financial guidance for the year ending December 31, 2026. The Company posted a Letter to Our Shareholders on its Investor Relations website, which provides a business update, details on its first quarter 2026 results, and its guidance for 2026. Dr. Qichao Hu, Founder and CEO of SES AI, noted, "We continued to build on the positive momentum we created in 2025 with a strong start to 2026, especially from the continued execution in our Energy Storage Systems business through UZ Energy. During the quarter, we entered into a multiyear distribution agreement with ATG EPower to expand our ESS business into the North American market. Our ability to provide both hardware and an intelligent operating system that predicts battery health and reduces maintenance costs is a key differentiator for both our current and prospective customers. "Our drone cell business continues to grow, as we completed the conversion of our manufacturing line at our Chungju, South Korea facility from EV pouch cells to drone-format pouch cells, with the converted line now ramping up to an annual capacity of approximately 1,000,000 drone cells. During the quarter, we have seen strong customer interest and began shipping sample cells to prospective defense and commercial drone customers for evaluation and qualification testing," Dr. Hu added. "In April, we introduced the fifth iteration of the Molecular Universe, version 2.5, which delivers upgraded capabilities across our six AI-powered workflows, and signed a major global battery manufacturer to a multiyear contract for our Search in a Box product," stated Dr. Hu. "During the quarter, we made progress on our plan to grow revenue across our three business units, expand margins, and reduce costs, while we continue to develop our commercial pipeline to deliver on our full-year outlook." The Company will hold a conference call later today at 5:00 p.m. Eastern Time. A webcast of the live conference call will be available through SES’s Investor Relations website, https://investors.ses.ai. The following link can be used to register in advance for the call: https://events.q4inc.com/attendee/998500960. The conference call can also be accessed live over the phone by dialing the following numbers: United States (Toll Free): 800-715-9871 International: +1 646-307-1963 Access Code: 2990899 A webcast replay will be available shortly after the call at: https://investors.ses.ai/events-and-presentations/events/default.aspx About SES AI: SES AI Corp. (NYSE: SES) is powering the future of global electric transportation on land and in the air with the world’s most advanced Li-Metal batteries. SES AI is the first battery company in the world to accelerate its pace of innovation by utilizing superintelligent AI across the spectrum of its business, from research and development; materials sourcing; cell design; engineering and manufacturing; to battery health and safety monitoring. Founded in 2012, SES AI is an Li-Metal battery developer and manufacturer headquartered in Boston and with operations in Singapore, Shanghai, and Seoul. Learn more at SES.AI. SES AI may use its website as a distribution channel of material company information. Financial and other important information regarding SES AI is routinely posted on and accessible through the Company’s website at www.ses.ai. Accordingly, investors should monitor this channel, in addition to following SES AI’s press releases, Securities and Exchange Commission filings and public conference calls and webcasts. Forward-Looking Statements This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, about us and our industry that involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as "will," "goal," "prioritize," "plan," "target," "expect," "focus," "look forward," "opportunity," "believe," "estimate," "continue," "anticipate," "project" and "pursue" or the negative of these terms or similar expressions. These statements are based on the beliefs and assumptions of the management of the Company. You should not place undue reliance on these forward-looking statements. Although the Company believes that its plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, it cannot provide assurance that it will achieve or realize these plans, intentions or expectations. Should one or more of a number of known and unknown risks and uncertainties materialize, or should any of our assumptions prove incorrect, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include, but are not limited to, among other things, risks relating to the Company’s ESS business and the ability of our products to meet customer needs, the risk that the market for the Molecular Universe platform is still emerging, and may not achieve the customer interest or growth potential that SES AI expects; risks relating to the uncertainty of achieving and maintaining profitability; risks relating to the uncertainty of meeting future capital requirements; risks relating to the integration of Shenzhen UZ Energy Co., Ltd. into the business of SES; the market for drones, robotics and air mobility, and for use of SES technology in such applications, is still emerging and may not achieve the growth potential we expect; potential supply chain difficulties; the ability to obtain raw materials, components or equipment through new or existing supply relationships; our use of artificial intelligence and machine learning may result in legal and regulatory risk; risks resulting from SES’s strategic alliances and investments; product liability and other potential litigation, regulation and legal compliance; SES’s ability to attract, train and retain highly skilled employees and key personnel; risks related to SES’s intellectual property; business, regulatory, political, operational, financial and economic risks related to SES’s business operations outside the United States; SES’s failure to satisfy certain NYSE listing requirements may result in its Class A common stock being delisted from the NYSE, which could eliminate or adversely affect the trading market for SES Class A common stock; the volatility of SES’s common stock and value of SES’s public warrants; SES has, in the past, identified material weaknesses in its internal control over financial reporting and may identify material weaknesses in the future or otherwise fail to maintain an effective system of internal controls and other factors described in our filings with the Securities and Exchange Commission (the "SEC"), including in the "Risk Factors" and "Management’s Discussion and Analysis of Financial Condition and Results of Operations" sections of our most recently filed Annual Report on Form 10-K, Quarterly Report on Form 10-Q and other documents that we have filed, or that we will file, with the SEC. Any forward-looking statements made by us in this press release speak only as of the date on which they are made, and subsequent events may cause these expectations to change. We disclaim any obligations to update or alter these forward-looking statements in the future, whether as a result of new information, future events or otherwise, except as required by law. View source version on businesswire.com: https://www.businesswire.com/news/home/20260423987642/en/ Contacts For the media: [email protected] For investors: [email protected]

Revenue and outlook: SES AI reported Q1 revenue of $6.7 million (up 47% sequentially), reaffirmed full-year 2026 guidance of $30–35 million, and finished the quarter with about $178 million in liquidity after using roughly $20 million of cash in operations. Energy storage is the main near-term driver: UZ Energy drove the majority of Q1 sales and SES AI launched North American distribution with AT‑G E‑Power (a ~ $20 million, three‑year agreement), while its Edge Box aims to cut battery state‑of‑charge estimation error to ~3%. Drone cells ramping and commercial potential: The Chungju facility was converted to produce NDAA‑compliant drone cells with >1M annual capacity, SES AI has a pipeline of a few dozen customers and expects drone revenue to start in Q2, with 1M cells implying roughly $25–35 million in potential revenue. Interested in SES AI Corporation? Here are five stocks we like better. 3 Defense Stocks Under $20 With Massive Upside SES AI (NYSE:SES) reported first-quarter 2026 revenue of $6.7 million, up 47% sequentially from $4.6 million in the fourth quarter of 2025, as the company cited growth in its energy storage systems business and early contributions from its drone cells and Molecular Universe (MU) software subscriptions. Founder and CEO Qichao Hu said the company had “a strong start for 2026,” with Q1 revenue “well above published consensus estimates.” SES AI reaffirmed its full-year 2026 revenue guidance of $30 million to $35 million, with contributions expected from all three revenue-generating business units. → STMicronelectronics Sends Industrial Chips Into Overdrive 5 EV Battery and Lithium Stocks Charging the Future Hu also addressed a finance leadership change, noting that CFO Jing Nealis will transition out of the role effective April 27. “On behalf of the entire team and our board, I want to thank her for her contributions and wish her well,” Hu said. The company appointed Ray Liu as its new CFO effective April 27. Hu described Liu as a finance executive with more than 20 years of experience in FP&A, strategic finance, and SEC reporting, including roles at Aiden and MetLife Investment Management. Hu added that Liu is a CFA charterholder and CPA. → The Trade Desk: Down 75%, But a Reversal May Be Near Hu said energy storage systems (ESS) remained SES AI’s “largest near-term revenue driver” and accounted for the majority of Q1 revenue through UZ Energy. The company pointed to growing demand for its commercial and industrial energy storage solutions and an expanding geographic footprint. SES AI announced entry into the North American market through a multi-year distribution agreement with AT-G E-Power, which Hu described as a leading North American distributor of renewable energy and energy storage solutions operating since 2001. Hu said the contract is valued at approximately $20 million over three years and provides access to AT-G E-Power’s distribution network across residential, commercial, and industrial segments. → Vertiv Keeps Chugging, Price Targets Flip to the Upside During Q&A, Hu characterized the arrangement as “a wholesale distribution,” and CFO Jing Nealis confirmed revenue recognition is shipment-based. “Once we ship it, based on the Incoterm, we will be able to recognize product revenue,” Nealis said. Hu also discussed the company’s Edge Box offering, describing it as an on-premise system designed to more accurately estimate battery state of charge and health. He said typical industry estimation error can be 7% to 10%, which can lead customers to buy more capacity than needed. With Edge Box, Hu said error can be reduced to about 3% or less, potentially lowering customer costs and providing data security because it operates on-premises rather than in the cloud. Hu added that more accurate estimates could also help customers participating in virtual power plant programs or electricity trading. On ESS seasonality, Nealis said Q2 and Q3 are “usually higher than Q4,” but emphasized that UZ Energy’s global footprint across regions makes the overall pattern less tied to a single market. “For this year at least, we see growth quarter-over-quarter, with some seasonality,” she said. Hu said SES AI completed the conversion of its manufacturing line at its Chungju, South Korea facility from EV-format cells to drone-format power cells. He noted the facility produced the “world’s first 100 amp-hour lithium metal cell” in 2021 and has been NDAA compliant since that year. Hu said the converted line is expected to ramp to an annual capacity of more than 1 million drone cells and incorporates “AI for manufacturing” capabilities intended to support quality and cost effectiveness. Hu said the company began shipping NDAA-compliant cells produced in Chungju to prospective defense and commercial drone customers earlier in the month for evaluation and qualification testing. He described customer interest as “strong,” and said the U.S. defense drone market represented the most significant near-term opportunity. When asked about qualification timelines, Hu said drone qualification typically takes “one-two quarters,” adding that many performance and product tests started last year have largely been completed and that current work is focused on supply chain audits verifying materials and processing occur in Korea. Asked about the mix of defense versus commercial interest, Hu said it is “predominantly defense,” noting that customers seeking NDAA compliance are typically those pursuing defense contracts. In another Q&A exchange, Hu addressed potential revenue from the drone cell business. He said market pricing for NDAA-compliant cells varies by format but generally ranges from $25 to $35 per cell, implying that 1 million units could represent about $25 million to $35 million in revenue. Hu also said the factory could scale beyond 1 million units if needed. Hu said the company has “a pipeline of a few dozen customers” for drone cells and expects drone cell revenue in Q2, with momentum building in Q3 and Q4. He described 2027 as “a full year” in which the company expects to have the ability to deliver a full year of NDAA-compliant cells. On materials, Hu said SES AI and its customers have been discovering new electrolyte materials through the Molecular Universe platform, including for applications beyond the company’s current cell production. He said approximately a half dozen customers have progressed through second-phase testing for materials discovered using the platform, and that the overall pipeline of customers has grown. Hu said SES AI remains on track with its Heisen joint venture, which he said is intended to leverage 150,000 tons of annual global capacity to produce materials at commercial scale as demand develops. Hu also announced the release of Molecular Universe version 2.5, described as the fifth major iteration since the platform launched in 2024. He said version 2.5 upgrades capabilities across six AI-powered workflows—ask, search, formulate, design, predict, and manufacture—and expands enterprise on-premise deployment options while covering both lithium and sodium chemistries. During the quarter, Hu said a “major global battery manufacturer” committed to a multi-year subscription of the company’s Molecular Universe “Search in a Box” product, which he said SES AI views as validation of the platform. Hu added that on-premise MU revenue is expected to be a modest direct contributor in 2026, though he said the platform’s largest impact is expected to come from advantages it provides across the ESS, drone, and materials businesses. When asked to quantify MU on-premise contribution, Hu said the company may provide more detail “in the next quarter.” CFO Jing Nealis said SES AI is presenting results sequentially due to the company’s three-business-unit structure taking shape in Q4 2025. She also noted that Q4 2025 revenue was impacted by approximately $1.5 million of revenue that shifted into Q1 2026. Revenue: $6.7 million in Q1 2026, up from $4.6 million in Q4 2025. Gross margin (GAAP): 18.1% versus 11.3% in Q4 2025. Gross margin (non-GAAP): 18.3% versus 11.7% in Q4 2025, excluding stock-based compensation and depreciation/amortization in cost of revenue. Operating expenses: $19.1 million GAAP versus $18.2 million in Q4 2025; $14.3 million non-GAAP versus $13.5 million in Q4 2025. Net loss (GAAP): $12.1 million, or a $0.04 loss per share, compared with a $17.0 million net loss, or $0.05 loss per share, in Q4 2025. Net loss (non-GAAP): $11.1 million, or $0.03 loss per share, compared with a $11.8 million net loss, or $0.04 loss per share, in Q4 2025, excluding items including stock-based compensation and changes in fair value of sponsor earn-out liabilities and including interest income. Adjusted EBITDA: loss of $12.8 million versus a loss of $13.8 million in Q4 2025. Nealis highlighted that GAAP net loss can be affected by non-cash mark-to-market changes in sponsor earn-out liabilities. In Q1 2026, SES AI recorded a $4.2 million non-cash gain related to these liabilities. The company used approximately $20 million in cash for operations during Q1 and ended the quarter with liquidity of approximately $178 million. Nealis said SES AI’s “CapEx-light business model” remains a core discipline and that the liquidity position provides runway to fund operations and execute 2026 growth initiatives. SES AI reiterated its expectation of an approximately 15% reduction in full-year operating expenses. In response to a question about cadence, Nealis said the company has been taking actions starting in Q1, with some reduction expected in Q2 and the “full quarter impact starting from Q3,” adding that Q4 may be “slightly lower than Q3.” Nealis also noted the company expects to file a new S-3 shelf registration statement concurrent with its Form 10-Q because the current shelf expires April 28, calling it “a routine administrative filing to maintain our financial flexibility.” Looking ahead, Hu said the company’s priorities for the remainder of 2026 include executing on the ESS opportunity through UZ Energy and its distribution network, advancing the drone cell business toward commercial-scale engagements, delivering on the materials pipeline, and continuing to develop Molecular Universe as both a revenue stream and competitive advantage. SES AI Corporation engages in the development and production of high-performance Lithium-metal rechargeable batteries for electric vehicles, electric vehicle take-off and landing, and other applications. The company was founded in 2012 and is headquartered in Woburn, Massachusetts. The article "SES AI Q1 Earnings Call Highlights" was originally published by MarketBeat.