ESS Tech (NYSE:GWH) reported a smaller first-quarter loss and highlighted progress on commercial projects, technology validation and balance sheet initiatives as the long-duration energy storage company continues what management described as an operational reset.
Chief Executive Officer Drew Buckley said the quarter and subsequent period showed progress across three priorities: “commercial momentum, technology validation, and strengthening our balance sheet.” The company is focused on iron flow energy storage systems, including its Energy Base product, which Buckley said is designed for 10- to 22-hour long-duration storage applications where lithium-ion systems may be “too costly, unsafe, or inefficient.”
Revenue falls as company transitions product offering
Despite lower revenue, ESS reported improvements in several expense and loss metrics. Cost of revenue decreased $1.6 million, or 18%, to $7.2 million from $8.7 million a year earlier. Total operating expenses fell $3.3 million, or 33%, to $6.7 million from $10 million, driven primarily by reductions in sales and marketing expenses and general and administrative expenses.
Net loss for the quarter was $15.9 million, compared with $18 million in the prior-year period, an improvement of $2.1 million, or 12%. Adjusted EBITDA loss improved to $10.3 million from a loss of $15 million a year earlier, a 31% improvement.
Suhadolnik said the results reflected “continued cost discipline and operational reset” efforts. She defined adjusted EBITDA as net loss before interest, stock-based compensation, depreciation and amortization, warrant revaluation gains or losses, financing costs, and certain other income or expense items the company does not view as indicative of ongoing operations.
Liquidity supported by January financing
ESS ended the first quarter with $15.5 million in unrestricted cash and cash equivalents and $6 million in short-term investments, for total liquidity of $21.5 million. That compared with $22 million as of Dec. 31, 2025. Including other liquid assets, the company’s total cash and liquid asset position was $21.6 million at quarter-end, compared with $22.1 million at year-end 2025.
Net cash used in operating activities was $13.5 million in the first quarter, compared with $18.2 million in the prior-year period. Management also pointed to a $15 million registered direct offering completed in January at $1.75 per share, which Buckley said was priced at a premium to the previous day’s closing price. The proceeds are intended to support general corporate purposes and working capital.
“Across the business, we remain focused on expense control, liquidity, and maintaining financial flexibility as we support the company through its transition and commercialization efforts,” Suhadolnik said.
Commercial pipeline includes SRP-Google project and Air Force-related contract
Buckley highlighted several commercial developments, including Project New Horizon, a collaboration framework with Salt River Project and Google for a 5 megawatt, 50 megawatt-hour pilot using ESS’s Energy Base technology. The project is planned for SRP’s Copper Crossing Energy and Research Center in Florence, Arizona.
Manufacturing for Project New Horizon is expected to begin in 2026, with delivery targeted for December 2027. Buckley said the pilot will sell capacity to SRP under a 10-year energy storage agreement. He called it a “landmark project” for ESS, saying it pairs a public power utility with a large hyperscale customer and validates commercial interest in long-duration iron flow storage.
The company also received a $9.9 million contract with Concurrent Technologies Corporation and the U.S. Air Force Research Laboratory for a large-capacity energy storage system of up to 27 megawatt-hours to support a U.S. operations station. Buckley said the contract underscores the value of ESS’s domestically manufactured, non-flammable iron flow technology for defense and remote infrastructure applications.
In addition, ESS signed a letter of intent for a strategic partnership with Alsym Energy to jointly develop next-generation battery solutions. Buckley said the partnership would expand ESS’s addressable market into short- and medium-duration storage applications, complementing the company’s long-duration iron flow strategy.
Technology validation and roadmap milestones
Management emphasized two technology validation milestones during the quarter. Buckley said the American Public Power Association, working with Burbank Water and Power, completed a 21-month utility demonstration of an ESS iron battery system under APPA’s Demonstration of Energy and Efficiency Developments program. According to Buckley, the final report concluded that ESS’s iron flow battery technology “works as intended” and has a clear use case in the utility’s energy storage strategy.
ESS also commissioned two iron flow battery systems at Turlock Irrigation District in California’s Central Valley. Buckley said the deployment features a solar-over-canal configuration that pairs renewable generation with long-duration storage while supporting water conservation objectives by reducing evaporation from irrigation canals.
Looking ahead, Buckley outlined several milestones in ESS’s technology roadmap:
- Commissioning a 200 kilowatt Energy Base system at the company’s Wilsonville, Oregon facility by the third quarter.
- Delivering the first 800 kilowatt, 10-hour client system in the first half of 2027.
- Delivering the 5 megawatt, 50 megawatt-hour Project New Horizon system to Salt River Project by the end of 2027.
Buckley said full-scale Energy Base components have met the performance specifications required for the Salt River Project pilot, calling that a “critical engineering milestone.” He also said ESS deployments at commissioned sites through 2025 generated more than 2 gigawatt-hours of transacted energy.
During the quarter, ESS acquired intellectual property and assets from VoltStorage, which Buckley described as a pioneer in iron salt battery technology. The company also appointed Randy Selesky as chief commercial officer, while Buckley, Suhadolnik and Kelly Goodman were named to new leadership roles as CEO, CFO, and chief strategy officer and general counsel, respectively.
Buckley said investors should monitor “new commercial wins, pilot systems that generate data on performance and commercial viability at scale,” progress on the 200 kilowatt and 800 kilowatt development path, and continued execution toward the Salt River Project project targeted for 2027.
About ESS Tech (NYSE:GWH)
ESS Tech, Inc (NYSE: GWH) is a Portland, Oregon‐based company specializing in long‐duration iron flow battery energy storage solutions. The company’s core business centers on the design, manufacture and deployment of modular battery systems that store electricity using an iron‐chloride electrochemical process. These systems are engineered to support grid operators, utilities, commercial and industrial customers in integrating renewable power, managing peak loads and ensuring reliable back‐up power.
At the heart of ESS Tech’s offering is its “Energy Warehouse,” a containerized flow battery system featuring non‐toxic, fully recyclable materials and a simple architecture that separates energy storage capacity from power output.
