Solid Power, Inc. (SLDP) Q2 2026 Earnings Report, Transcript and Summary

Good day, and welcome to the Solid Power Second Quarter 2026 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to [ Charlie Van Goethem ], Investor Relations. Please go ahead.

Thank you, operator. Welcome, everyone, and thank you for joining us today. I'm joined on today's call by Solid Power's President and Chief Executive Officer, John Van Scoter, and Chief Financial Officer, Linda Heller. A copy of today's earnings release is available on the Investor Relations section of Solid Power's website, www.solidpowerbattery.com. I'd like to remind you that parts of our discussion today will include forward-looking statements as defined by U.S. securities laws. These forward-looking statements are based on management's current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, Solid Power disclaims any duty to update any forward-looking statements to reflect future events or circumstances. For a discussion of the risks and uncertainties that could cause actual results to differ materially from those expressed in today's forward-looking statements, please see Solid Power's most recent filings with the Securities and Exchange Commission, which can be found on the company's website at www.solidpowerbattery.com. With that, let me turn it over to John Van Scoter.

Thank you, Charlie, and thank you all for joining us today. We delivered another quarter of strong execution, advancing key strategic initiatives and reinforcing our position as a leader in solid-state battery materials. During the quarter, we improved the performance of our electrolyte through work under the Joint Evaluation Agreement with Samsung SDI and BMW, while providing electrolyte shipments to support their development activities. Based on performance and cost, we are optimistic about continuing to work with Samsung SDI for potential use of our electrolyte in EVs and other potential applications of ASSB technologies. We remain committed to supporting our partners as they advance towards commercialization. Turning to our electrolyte manufacturing road map, we continue to advance discussions with prospective joint venture partners for commercial-scale electrolyte production in South Korea. Korea remains one of the most active markets for all-solid-state battery development, and we believe a partnership with an industry-leading company would accelerate market adoption while providing manufacturing scale and market access. We're pleased with the progress of these discussions and believe they reflect growing industry interest in our technology and commercialization strategy. Based on the progress we've made to date, we remain on track and expect to announce a joint venture by the end of the year. Execution of our continuous manufacturing pilot line remains on schedule and represents one of the most important milestones in our commercialization journey. During the quarter, we advanced installation of major process equipment, piping and electrical infrastructure and are preparing for equipment acceptance testing, which remains on track for completion in the third quarter. We continue to expect plant validation and operational start-up in the fourth quarter. This pilot line is designed to demonstrate the scalability and efficiency of our proprietary wet process technology and positions us in the transition from batch to continuous production, an important step towards commercial-scale manufacturing. Operational excellence remains a core priority as we prepare for commercial readiness. During the quarter, we successfully completed Stage 1 of our ISO 9001 certification process and remain on track to complete the Stage 2 audit in the third quarter, with certification expected by year-end. Achieving ISO 9001 certification will further enhance our quality systems, strengthen customer confidence, and support the commercial readiness of our electrolyte business. Finally, we successfully completed the Line Installation Agreement with SK On and received the associated milestone payment during the quarter. This accomplishment represents another successful milestone in our collaboration and highlights our ability to execute key customer commitments while supporting the advancement of next-generation battery technologies. We're currently negotiating with SK On regarding a new collaboration agreement, which we believe underscores the growing demand for our technology and reflects our continued commitment to expanding strategic partnerships that drive long-term value. Overall, we are pleased with the progress achieved during the quarter. We continue to execute against our commercialization road map across our customer programs, manufacturing scale-up initiatives, strategic partnership discussions and operational readiness efforts. We believe the momentum we are building today positions Solid Power to capitalize on the significant opportunities emerging within the all-solid-state battery market and create long-term value for our shareholders. With that, I'll turn it over to Linda to review our financial results and provide an update on our financial discipline goal. Linda?

Thank you, John. Year-to-date revenue totals $2.8 million, reflecting our ongoing progress under the U.S. Department of Energy Assistance Agreement and revenue from our collaboration agreement with SK On. During the second quarter of 2026, our revenue was negative $300,000. Current quarter revenue was impacted by a reversal of revenue from the first quarter of $1.2 million, driven by a change in our assumptions within certain milestone payments connected to our SK On research and development license agreement. As we continue advancing our commercialization initiatives, operating expenses were $30 million during the second quarter, compared to $29.4 million in the first quarter of 2026. Expenses remained well controlled and are generally consistent quarter-over-quarter, despite continued investments in technology development, customer programs and manufacturing scale-up activities. Operating loss for the quarter was $30.3 million, and net loss was $23.8 million, or $0.11 per share, reflecting our continued investment in long-term growth opportunities and commercialization readiness. Capital expenditures totaled $6.3 million during the quarter, primarily related to construction of our new continuous electrolyte production pilot line. This strategic investment remains an important milestone in our manufacturing road map and is expected to play a key role in demonstrating our scalable, commercial-ready production capabilities. Turning to our balance sheet and liquidity, Solid Power's financial position remains a significant strength. We ended the quarter with total liquidity of $419.3 million, providing substantial financial flexibility and significant runway to execute our strategic priorities. In addition, contract assets and accounts receivable totaled $3.2 million, total current liabilities were $17.2 million, and we continue to have no debt, reflecting a healthy balance sheet and a strong liquidity profile. Overall, we remain focused on disciplined capital allocation while continuing to invest in strategic initiatives that support long-term growth. We believe our strong balance sheet provides financial capability to execute our commercialization strategy and support our customers' development programs. I will now turn the call back to John.

Thank you, Linda. In closing, I want to thank our employees, customers, partners and shareholders for their continued support and confidence in Solid Power. The progress we've achieved this quarter reflects the strength of our team, the value of our technology, and our disciplined focus on execution. As we look ahead, we are entering an important phase of our commercialization journey. With strong customer and partner engagement, continued advancement of our manufacturing capabilities, a robust balance sheet and growing commercial opportunities, we believe Solid Power is well positioned to deliver meaningful milestones and create long-term value. While there's still important work ahead, we're encouraged by the momentum we are building and remain confident in our ability to execute against our strategy and advance the adoption of all-solid-state battery technology. Thank you for your time today. We look forward to updating you on our continued progress in the quarters ahead. We will now take your questions.

[Operator Instructions] The first question comes from Jake Sekelsky with Alliance Global Partners.

So just starting with the continuous line, are there any major items that you're still waiting on delivery of? And how should we think about the ramp-up there to capacity in the coming quarters?

Good to hear from you, Jake. Thank you for your question. We do not have any major equipment outstanding. The last major piece was installed. It's the rotary kiln. That was done in the May time frame. So all equipment is in-house and is in the process of being commissioned or hooked up, I should say. And then commissioning, as we have indicated, will start in the fourth quarter to be completed by the end of the year. So the capacity for that one line is 45 metric tons once it is fully commissioned, and we would expect to output from that line in the first quarter of next year.

Okay. That's helpful. And switching gears to the ISO certification, you touched on it earlier. Can you just provide some color on the progress here and maybe the specific steps or milestones you need to reach by year-end to kind of achieve that target for Phase 2?

Sure. We started preparing for this audit beginning of last year, believe it or not. And the team assembled all of the outstanding specifications, work processes and so forth that we needed to put in place in time for the Stage 1 audit. As reported, we completed that 1-day audit in the quarter. It was very successful. There are no major findings. There's some minor things that we're following up on. And we're getting ready for, in the middle of this month, the Stage 2, which is a much more intense audit. It's a 3-day audit, and we'll have all of the subject matter experts and process owners that will be available those 3 days with the auditor. It's quite intense. But we're getting ready for that. And because there are no major findings in the Stage 1, we feel quite confident that anything that is called out in that Stage 2, that we will have time before the end of the year to complete those items, report those back to the auditor, and get the certification.

Understood. Okay. And then just lastly, on the new collaboration agreement that you're exploring with SK On, to the extent you're able to, are you able to provide any details on what the framework of the new collaboration agreement might look like at this stage? Or is it a bit too early there?

Yes. Jake, I'm sorry. I wish I could report out more. I really can't right now. It's still early stages. So I think next quarter, we'll be able to give you some more color on that. And certainly, by the time we get the agreement in place, we'll be able to give you details on that. But right now, it's really in the very early stages of discussions.

The next question comes from Sameer Joshi with H.C. Wainwright.

On the joint evaluation agreements with Samsung SDI and BMW, are there any next steps that we should expect this year and then in the future? If you can just lay out what we should be looking out for would be helpful.

Yes. As reported, Sameer, we expect that the original Phase 1 contract will expire at the end of September, but that we will continue to collaborate with both parties as we go forward. We are in the process of discussing what that will look like right now with both parties. But we expect, based on the significant performance enhancements, quality enhancements that we achieved in Phase 1, along with the long-term cost road map that we have with our wet process, that we'll find a way to continue to collaborate and to work with both Samsung SDI and BMW on an ongoing basis.

Okay. And then on the electrolyte production partnership that you're looking for in the Republic of Korea, is there-- and you have indicated that you would achieve it by the end of the year. What gives you confidence? Like if you could give us -- provide some color how we can get that confidence as well.

Yes. We have 3 parties that we've been actively discussing with for some time. All -- signs from all 3 of them remain positive. One of them we've advanced, though, quite far along with the draft term sheet, actually, that is in discussion right now with one of the parties. So that's what gives us the confidence that we'll have something done here in the short term and certainly by the end of the year.

Sounds really good. And then just last one. We understand the reversal of certain revenues because of recognition issues. Was there any direct costs also that were associated with these that were reversed and that are reflected in the income statement?

No. The revenue under these agreements is recognized over the contractual term of all 3 agreements in a revenue recognition model. The adjustment that we made is noncash. It doesn't represent any sort of obligation or a cash outflow or any cost related to it.

The next question comes from Colin Rusch with Oppenheimer.

Could you talk a little bit about how you're tracking performance of the material and cells as you move forward with these arrangements and what that can do for your cost profile?

Sure, sure. Good to hear from you, Colin. Yes, as I think you know quite well, we're still in the early stages of cell design. Our customers are continuing to evolve their cell designs, their chemistries, their binders, their solvents. And so a lot of the work that has been done is around improving our performance in their chemistries, number one. Number two, we focus very heavily on quality. So lot-to-lot consistency and the tightness of certain specifications that are really, really important to our customers, things like particle size, et cetera. Each customer seems to have their own requirement there. So we're focused very heavily on controlling that and delivering to their expectations. Long-term cost, we believe we have a structural advantage with our wet process. We've done a lot of work through the joint venture work -- partnership work with potential partners in Korea that have dry processes, and we've been able to actually benchmark our long-term road map against an equivalent capacity output for a dry process. And again, we believe quite strongly that we have a structural advantage there. So that would be my comments on the performance as well as long-term cost road map. We intend to be the cost leader as we go through our commercialization phase and on up into ramp.

Excellent. That's super helpful. And then I guess the second question is really around customer development in the U.S. and potential for manufacturing domestically as we see an increased level of regionalization around the battery space. And obviously, you guys have multiple options and multiple opportunities internationally as well. But just curious about the development of domestic customers and what they're looking for from a production perspective.

Yes. Six months ago, we started getting signals from the humanoid robotic companies. And since then, it's picked up quite considerably there. There's a number of U.S. players that are expressing interest in all-solid-state batteries because of the advantages in energy density, safety and charge rate. So I would say some of those discussions are advancing with some of the leaders in the space right now domestically. We still do not see any domestic manufacturing of cells at that scale, but that could change with the coming quarters. But we definitely have seen an uptick in humanoids since we last reported. We also have gotten a small amount of interest from defense and aerospace markets in the past quarter.

This concludes our question-and-answer session. I would like to turn the conference back over to John Van Scoter for any closing remarks.

Thank you for joining the call today and for your interest in Solid Power. We look forward to updating you again next quarter.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.