374Water Inc. (SCWO)·Q4 2024 Earnings Summary

Executive Summary

• Q4 2024 revenue was $0.012M*, bringing FY 2024 revenue to $0.445M as the company prioritized commercialization and demonstrations; FY operating expenses rose 59% to $11.9M and net loss widened to $12.4M .
• Management reiterated a 2025 revenue line-of-sight of $4–$6M, underpinned by Waste Destruction Services (WDS) launch, multiple demonstration programs, and capital sales pipeline; medium-term ambition remains $250–$500M annual revenue in ~5 years .
• Operational catalysts include Orange County Sanitation (CA) deployment, Orlando 90-day biosolids demonstration, DoD PFAS project in Detroit, and the North Carolina AFFF destruction contract (phase 1: 1,000 gallons; potential +28,000 gallons) .
• Liquidity was bolstered via a $12.2M registered direct offering in November 2024, supporting manufacturing scale-up, WDS launch, and team expansion .

What Went Well and What Went Wrong

What Went Well

• Management executed on commercialization milestones: “ongoing progress in the development and commercial scale deployment” and “significant progress ruggedizing and optimizing” AirSCWO; Orlando site enabled broad demonstrations across solid and liquid waste streams .
• Growth plan articulated with diversified go-to-market (capital sale, lease, WDS) and concrete 2025 line-of-sight to $4–$6M; medium-term $250–$500M annual revenue ambition provides strategic north star .
• Material commercial wins and pipeline visibility: Orange County deployment, Orlando 90-day demo, DoD Detroit PFAS project, and North Carolina AFFF WDS contract (phase 1: 1,000 gallons; potential +28,000 gallons) .

What Went Wrong

• Revenue remained de minimis amid prioritization of commercialization/demonstrations; FY 2024 revenue was $0.445M, down from the prior year; expenses stepped up with professional fees, G&A, compensation, and R&D driving opex +59% YoY to $11.9M and net loss to $12.4M .
• Quarter-level run-rate volatility persisted: Q3 revenue was $0.081M; nine-month 2024 revenue fell ~50% YoY given timing of milestone recognition and transition to demonstrations; management cited fewer milestones reached and correlation of reduced revenue to end-of-fabrication and testing .
• Manufacturing capacity constraints require eventual facility expansion; current capacity supports ~2–4 systems in parallel, implying execution dependence on scaling operations over 2025–2026 .

Financial Results

Quarterly results (sequential and YoY context; estimates shown where available)

Notes: Q4 2024 revenue actual from S&P Global; EPS and margin not available at quarter level. Values with asterisk are from S&P Global.*

Full-year summary

Segment breakdown: Not applicable; the company reports consolidated results focused on AirSCWO commercialization .

KPIs:

• Cash runway supported by $12.2M gross proceeds from registered direct offering in Nov-2024 .
• Manufacturing capacity currently ~2–4 systems in parallel .
• Operational milestones scheduled: Orange County deployment, Orlando 90-day demo, DoD Detroit PFAS project .

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “The fourth quarter of 2024 and early 2025 demonstrated ongoing progress in the development and commercial scale deployment of our proprietary AirSCWO system… conducted numerous municipal, federal, and industrial waste destruction demonstrations” .
• “For 2025, we have line of sight to $4 million to $6 million in revenue… we believe we have a path to $250 million to $500 million in revenue in 5 years” .
• “We were recently awarded a contract by the State of North Carolina to destroy 1,000 gallons of AFFF… could increase by up to 28,000 gallons in a subsequent phase” .
• “We can manufacture roughly two to four systems at a time… eventually we will have to expand our facilities” .

Q&A Highlights

• North Carolina AFFF contract: Phase 1 is 1,000 gallons with a six-month destruction timeline from receipt; performance criteria are complete elimination and effective/rapid processing .
• Manufacturing capacity: Current throughput ~2–4 systems concurrently across AS1/AS6/AS30; facility expansion anticipated as volumes scale .

Estimates Context

• Wall Street consensus estimates were largely unavailable for EPS, target price, and recommendation in Q4 2024 (no consensus returned).
• S&P Global actuals indicate Q4 2024 revenue of $0.0119M* and FY 2024 revenue of $0.445M*, consistent with reported FY figures. EPS consensus and target price were unavailable.*

Values with asterisk are from S&P Global.*

Key Takeaways for Investors

• Early-stage commercialization remains the core narrative: modest reported revenue with clear 2025 line-of-sight ($4–$6M) and medium-term ambition ($250–$500M) contingent on WDS and capital sales execution .
• Regulatory PFAS tailwinds and government initiatives (EPA stance, DoD Detroit, NC AFFF) should support demand and provide validation for AirSCWO efficacy and scalability .
• Liquidity strengthened via $12.2M capital raise; funds earmarked for tech ruggedization, manufacturing scale, WDS launch, and team expansion—reducing near-term financing risk .
• Capacity constraints (2–4 systems in parallel) are a key operational bottleneck; facility expansion and supply chain execution will be critical to meet pipeline conversion and deployment timelines .
• Expense structure elevated in 2024 (professional fees, G&A, R&D) as the company rebuilt leadership and relocated manufacturing; investors should watch for opex discipline as revenue scales .
• Near-term catalysts: Orange County deployment, Orlando 90-day demo updates, DoD project outcomes, initial WDS site(s) accepting third-party waste streams, and additional AFFF volumes in NC .
• With consensus coverage sparse, stock reaction may hinge on tangible execution milestones (deployments, WDS revenues, signed capital sales) rather than quarterly “beats/misses.”*

S&P Global disclaimer: Values marked with an asterisk (*) were retrieved from S&P Global.