American Battery Technology Company - Earnings Call - Q4 2025

Executive Summary

• Q4 FY2025 revenue grew 183% QoQ to approximately $2.8M as recycling operations ramped, substantially outpacing cost growth; non-GAAP cash COGS rose ~70% QoQ to $3.9M, evidencing improved operating leverage.
• Revenue materially beat Wall Street consensus ($2.78M* actual vs $1.24M* estimate; +123% beat), while EPS missed (-$0.11* actual vs -$0.08* estimate) as margins remained negative during scale-up [GetEstimates]*.
• Management highlighted accelerating throughput (+70% QoQ), expanding feedstock from AI-related BESS deployments, and strong grant/financing momentum (DOE $144M for plant #2; EXIM LOI $900M; Russell 2000 inclusion), bolstering liquidity ($12.5M cash/restricted at 6/30/25; $25.4M cash as of 9/15/25).
• Strategic catalysts: FAST-41 Covered Project status to streamline permitting for Tonopah Flats, continued qualification with OEMs, and near-term margin improvement from scale effects at the Reno recycling plant.

What Went Well and What Went Wrong

What Went Well

• Throughput scaling and revenue acceleration: “we nearly tripled revenue this quarter compared to the quarter ending March… our revenues are growing at a much faster pace than our costs” (CEO).
• Expanded feedstock and market positioning: recycling plant now receives substantial BESS feed materials tied to AI/data center buildout, broadening sources beyond EVs/consumer electronics.
• Program execution and strategic support: USABC program closed out; DOE contracted $144M grant for second recycling facility; EXIM Bank LOI for $900M low-interest loan for the Tonopah Flats refinery.
• Quote: “We have an exciting path ahead as we continue the growth in operations… while also accelerating the commercialization of our Tonopah Flats Lithium Project and our second battery recycling facility” (CEO Ryan Melsert).

What Went Wrong

• Margins still negative during ramp: GAAP COGS ($5.1M) exceeded revenue ($2.8M) in Q4, yielding a gross loss, despite improved cash COGS.
• EPS remained negative QoQ given high operating expense base and scaling costs; full-year total operating expenses were $31.4M despite a 30% YoY reduction.
• Balance sheet still reflects accumulated deficit ($260.1M) and ongoing financing needs as the company scales industrial operations.

Transcript

Tiffiany Moehring (Director of Communications and Marketing)

Good afternoon. I'm Tiffiany Moehring, and I'm the Director of Communications and Marketing at the American Battery Technology Company. I would like to welcome everyone to our fiscal fourth quarter and full year 2025 earnings call. On behalf of the entire team at American Battery Technology Company, I would like to thank everyone for taking the time to join our call today.

Following this presentation, a recording of this call, along with our press release and our quarterly SEC filing, will be available on our website at investors.americanbatterytechnology.com. This presentation includes forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Act, 1995. These statements are subject to risk and uncertainties that can cause actual results to differ from those anticipated. Additional information regarding the factors that may cause actual results to differ can be found in our annual filings.

On today's call, our CEO and CTO, Ryan Melsert, will provide remarks regarding our two lines of business, which include our lithium-ion battery recycling business and our primary claystone to lithium hydroxide business. It is now my pleasure to turn the meeting over to Ryan.

Ryan Melsert (CEO and CTO)

Great. Thank you, Tiffiany. As many of you know, we work in the critical mineral manufacturing business area. We are working to try to make the closed loop for the battery mineral supply chain within North America. Right now, this is much more of a linear economy, and as we work through this system, we're working with many of the partners in the other areas of the closed loop infrastructure.

In order to fully implement this closed loop system, we found that multiple different aspects were needed to be added. The first is the implementation and commercialization of a lithium-ion battery recycling system. In this system, we take back waste material from other stages of the industry, as well as end-of-life material, recycle those materials through a multi-phase process, and then make battery-grade materials that are sold right back into that closed loop.

If the total amount of batteries in the field was stable in a mature industry, recycling could provide the vast majority of minerals needed. But the battery industry is growing quickly. In addition to closing the loop, we also need to be filling that loop the first time. So in addition to our battery recycling business unit, we have also acquired large amounts of mineral resources in the U.S. and developed our own first-of-a-kind technologies of how to extract those individual battery elements, how to purify and upgrade them, and how to also make battery-grade products from our primary battery metals manufacturing business, in addition to our battery recycling business. As for our quarterly earnings that we are reviewing today, we're proud to show that compared to the previous quarter, we had a very large increase in revenue for the company.

This is largely due to increased operations at our first battery recycling plant just outside of Reno, so we nearly tripled revenue this quarter compared to the quarter ending March, and at the same time, we had a much smaller relative increase in our cash cost of goods sold, really showing that as we have economies of scale and larger operation in the first recycling plants, our revenues are growing at a much faster pace than our costs, so we look forward to continuing to ramp this plant and continuing to improve that gross margin. Separate from our quarterly financials, we also did just finish our fiscal year, and when you tie those past four quarters together, we also see a very substantial increase in revenue of about $4.3 million for this past year compared to about $0.3 million the year beforehand.

Similarly, it's a much larger relative increase in revenue than the increase in the cash cost of goods sold, allowing for an increase in margin as we continue to scale that plant and improve operations. Beyond just the recycling plant, total operational costs for the business actually decreased this past year over the year beforehand as we again experienced economies of scale and had cost control measures to improve operations. We were excited to have been selected to be listed on the Russell 2000 and 3000 indices back in June. This is really a sign that we have a different scale of investor as we move forward. Because of that, operations, we have seen a very substantial increase in trading volume since being added to that index and a significant increase in percentage ownership from institutional investors.

With that market activity, we've increased our cash balance to just over $25 million as of September 15th this year. As mentioned, our battery recycling operations, the main metric over the past year is that we have increased the throughput of our plant about 70% in a single quarter for the quarter ending June versus ending March. This really has been about a large amount of incremental improvements as we continue to add headcount, add shift count, have increased amounts of material, and improve our operations there. We've been working with several different projects at this recycling facility for the past few years. One of them is a grant contract we won from the U.S. Advanced Battery Consortium from a project that actually started back in the fall of 2021.

We've worked on that project for many years, and we formally closed out that project a few months ago, really able to show that we had achieved each of the requirements of that grant contract as we worked with the partners there, with the U.S.

Department of Energy, General Motors, Ford, and Stellantis, to really demonstrate that this recycling plant could take in full-scale batteries, recover those materials, purify the battery metals up to battery-grade, work with our partner, BASF, to actually take those recycled metals, manufacture large amounts of high-energy density active cathode material specifically from those recycled metals, and make large amounts, over 100 full-scale automotive battery cells from our recycled metals, and actually test those cells at both our partner and Department of Energy facilities against control group cells, and really being able to show that there was very little difference about the performance of the battery cells when using our recycled metals versus using metals from the market. This is a very important step for going through large-scale qualifications of many different customers. We were excited to receive financial support from the U.S.

ABTC and to now have this project closed out as we move forward to these different opportunities. Because of our increased operations and the successes working with our partners on these early-scale projects, last September, we were notified that we had been selected for a competitive grant from the U.S. Department of Energy for $144 million to now construct a second battery recycling plant.

We were selected back in September 2024, and through an accelerated process, we were contracted in December 2024 and actually started this project back on January 1st, 2025. So we're excited to be taking all the lessons learned in our first recycling plant, working through our next-generation designs, and moving forward with a second battery recycling facility. While we work with a lot of automotive companies, the past half year, we've really started to work even more with stationary grid battery systems.

These large battery energy storage systems usually work to support grid operations. They tend to be extremely large in the gigawatt-hour scale and have a different type of load profile than we see within automotive batteries. But because we make battery-grade minerals, they work equally well whether they're sold to companies to make batteries for vehicles or batteries for stationary storage. And similarly, we receive both types of material into our recycling facility near Reno.

A few months ago, we were fortunate enough to have been invited to the groundbreaking ceremony of one of the fastest supercomputers in the world at Argonne National Lab near Chicago. And the supercomputer is backed up by large amounts of grid-scale batteries. So it was great being able to join the ceremony. There were very few private companies actually in attendance. It was mostly different government organizations.

And to really highlight how the U.S. manufacturing of critical minerals supports data centers, supports supercomputers, and supports different types of artificial intelligence and machine learning operations, we were asked to present at this event actually to several dignitaries, including the U.S. Secretary of Energy, Chris Wright, back in July. So really being able to explain to him directly at the Argonne National Laboratory why both battery recycling and domestic lithium manufacturing are important to support data center, supercomputer, and artificial intelligence operations as we move forward. Because of our large amount of interactions with the DOE, it was great to be able to connect with this new administration and really show them the benefits of the projects we're working on together.

When we look at our primary claystone to lithium hydroxide technologies, over the past several years, we have been building out this multi-ton-per-day integrated pilot facility near Reno. While we finished bench-scale operations a few years ago, it's very important to take those bench-scale results and actually build demonstration-scale integrated systems that operate in real-time in a continuous fashion. This is a very big de-risking step as we look to be building out our commercial-scale lithium hydroxide refinery. Similarly, we were fortunate enough to have the buildup of this demonstration facility supported by a Department of Energy grant. This project also started in the fall of 2021.

And as of a few months ago, we've also officially closed out this project and completed all requirements, showing how we went through the design, construction, commissioning, and then sustained operations in a multi-week run, showing how we feed our specific Tonopah Flats claystone material into this plant, go through each of the operating steps, and make a battery-grade lithium hydroxide product out the back end.

So we've made many different scales of samples to be sent out to different strategic customers and to be able to go through different types of analytical evaluations, test manufacturing different types of active cathode material, and again, making full-size battery cells with the lithium specifically extracted from our Tonopah Flats project.

Because of the operations at our bench scale and these demonstration-scale facility, we have continued to go forward with the design of our commercial-scale 30,000-ton lithium hydroxide per year facility, working with our selected EPC firm, Black & Veatch, continuing to send these materials to customers for definition of different types of long-term offtake agreements as we progress that project. Building this demonstration facility has been great advancing the technology and de-risking the construction, but a parallel effort is advancing our permitting progress for the local, state, and federal levels.

We were excited a few months ago to have been selected by the White House, the National Energy Dominance Council, and the FAST-41 Permitting Council to have our Tonopah Flats Lithium Project be selected as a transparency priority project, which is really meant to streamline all federal permitting operations for high-priority critical mineral projects within the U.S.

Being selected for this was important to really get alignment amongst many of the different federal agencies, and this transparency priority project was really set up by the executive order that President Trump issued back on March 20th, but on top of becoming a transparency priority project, there was actually an escalation, and we were approved to become a full covered project just back in August, so now having our Tonopah Flats Lithium Project be a covered project, we have a project coordinator actually assigned to this effort, holding meetings amongst all different federal agencies, and really driving visibility and accountability as we move forward, so just in the past few weeks, we've seen very significant acceleration of these permitting efforts as we work to bring these different federal groups together.

And this FAST-41 Permitting Council works among all different federal agencies, including we've mentioned that back in the spring, we did receive a letter of interest from the U.S. Export-Import Bank to provide a $900 million low-interest loan to support this Tonopah Flats lithium project. So as a federal agency, this is also being facilitated through the Permitting Council and through our selection as a covered project. We mentioned we were added to the Russell Index back at the end of June. Since being added, we have a different set of investors really owning and trading our stocks. We've seen a very significant increase in our trading volume per day since the end of June being selected, and also a big increase in the amount of institutional ownership.

This has really provided many different types of discussions we've had with strategic investors since then, and has really facilitated different types of funding opportunities as we move forward. As a summary of our financial results for this fiscal year versus the previous one, as mentioned, a very substantial increase in revenue, really by increasing the operations and the ramp rates of our first battery recycling plant.

Our cost of goods sold has increased, but at a lower percentage than our revenue has increased. And as we continue to scale that plant, we expect to see continued improvements in our margin. We continue to receive funds from our government grants we have contracted, including ones that have started partway through the fiscal year. So we do expect to see that increase as we ramp up those newer projects.

And throughout the year, we were able to take in substantial funds through our financing activities and increase in funds used for our operating activities as we continue to ramp up our first recycling plant and a substantial decrease in our cash used for investing activities. As mentioned, our cash balance has increased substantially, both at the end of the fiscal year and as of mid-September, as we continue to receive funds, really facilitated by that listing on the Russell 2000 Index and the exercising of several of our outstanding warrants. We still have a large balance on our contracted government grants, as these are multi-year projects that we continue to receive funds on as we move forward.

We have received some competitive tax credits last spring that will still be monetized as we move forward and continue to build out our first recycling plant near Reno and our second recycling plant in the Southeast U.S. That's a summary of our financial results for the past fiscal year. We will be holding our annual shareholder meeting in November, at which time we will go through more details about the operations of our past year and some more of our multi-year operations as we look more forward-looking. At this time, I'd like to thank everybody for joining this earnings call as we went through the details of both our fiscal fourth quarter and our full fiscal year. We look forward to seeing everybody in mid-November at our full annual shareholder meeting.