Energy Vault Holdings Inc.
03/18/2026 | Press release | Distributed by Public on 03/18/2026 14:18
Annual Report for Fiscal Year Ending December 31, 2025 (Form 10-K)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis provide information which Energy Vault's management believes is relevant to an assessment and understanding of Energy Vault's consolidated results of operations and financial condition as of December 31, 2025 and for the fiscal year ended December 31, 2025. The discussion and analysis should be read together with our audited consolidated financial statements and related notes that are included elsewhere in this Annual report on Form 10-K. This discussion may contain forward-looking statements based upon Energy Vault's current expectations that involve risks, uncertainties, and assumptions. Energy Vault's actual results may differ materially from those anticipated in these forward-looking statements. You should review the section titled "Cautionary Note Regarding Forward-Looking Statements" for a discussion of forward-looking statements and the section titled "Risk Factors," for a discussion of factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis and elsewhere in this Annual Report. Energy Vault's historical results are not necessarily indicative of the results that may be expected for any period in the future. Unless the context otherwise requires, all references in this Annual Report to "we," "our," "us," "the Company," or "Energy Vault" refer to Energy Vault Holdings, Inc., a Delaware corporation, and its subsidiaries both prior to the consummation of and following the Merger (as defined below).
Our Business
Energy Vault delivers a diversified portfolio of energy storage solutions to third parties, including proprietary gravity, battery, and green hydrogen-based technologies, supported by our technology-agnostic energy management software and integration capabilities. Beginning in 2024, we initiated a multi-year transition from primarily delivering projects through build-and-transfer arrangements and licensing models toward a more integrated model that includes selectively developing, owning, and operating energy storage assets, while continuing to provide technology, integration, software, and long-term services to customers. We believe this strategy is supported by our experience across multiple storage technologies, system integration and controls capabilities, and established global presence, as well as access to project-level capital through our Asset Vault platform.
Through this integrated model, we offer utilities, independent power producers, and large energy users solutions that may include standalone energy storage, integrated generation and storage configurations, and related power infrastructure. We manage projects across the lifecycle, from sourcing and development through permitting and interconnection, engineering and construction management, commissioning, and operations, and we provide software enabled monitoring, controls, and services intended to support asset availability, operational efficiency, and lifecycle performance.
Key Factors and Trends Affecting our Business
We believe that our performance and future success depend upon several factors that present significant opportunities for us, but also pose risks and challenges including those discussed below and in Part I, Item 1A. "Risk Factors."
Impact of Tariffs
U.S. trade policy and tariff actions have affected the cost and availability of certain inputs used in our B-VAULT products and related project delivery. Beginning February 4, 2025, the United States imposed additional duties on imports from China and Hong Kong under IEEPA, which were increased effective March 4, 2025. In parallel, the United States imposed additional IEEPA based reciprocal duties on China origin goods in April 2025, which escalated to significantly higher levels by April 10, 2025. The United States and China subsequently announced tariff reductions and pauses beginning in mid-May 2025, and in November 2025 the United States implemented additional executive actions that (i) reduced the IEEPA fentanyl related additional duty rate on China origin imports and (ii) extended the reduced reciprocal duty framework through November 10, 2026, subject to the terms and conditions of the arrangement.
These tariff actions and related uncertainty materially affected our operations. Several third party sales projects within our backlog and developed pipeline experienced delays or cancellations due to the anticipated increase in costs associated with importing B-VAULT products from China. In addition, separate from IEEPA based duties, Section 301 tariff rates applicable to certain China origin products continued to evolve. For example, pursuant to U.S. Trade Representative actions finalized in 2024, the Section 301 duty rate applicable to lithium ion non electric vehicle batteries increased to 25% effective January 1, 2026. Depending on product classification and the interaction of applicable tariff programs, cumulative duty burdens can be significant and can materially affect project pricing and competitiveness.
On February 20, 2026, the U.S. Supreme Court held that IEEPA does not authorize the President to impose tariffs, and IEEPA based tariffs were invalidated. The decision does not affect Section 301 tariffs Section 232 tariffs. The Supreme Court decision did not address the process for obtaining refunds of IEEPA based duties previously paid, and the timing and availability of any potential duty relief remain uncertain. In response, the U.S. government has indicated it may continue to impose tariffs using other statutory authorities, which could affect future tariff levels, compliance requirements, and our ability to forecast costs and secure long term sales contracts.
In addition to U.S. tariffs, China has implemented and proposed export control measures affecting certain upstream materials and manufacturing inputs relevant to batteries, including graphite related controls that can affect availability, lead times, and cost. In response to the evolving trade environment, we are actively exploring alternative sourcing options, including vendors with manufacturing capabilities outside of China, to mitigate tariff and trade restriction impacts. As of the filing date of this Annual Report, we have not successfully imported our B-VAULT products from non-Chinese suppliers on an economical basis.
Should trade tensions escalate further, or if additional tariffs, trade restrictions, export controls, or retaliatory measures are implemented or reinstated, our ability to source B-VAULT products or sell them at competitive prices could be adversely affected, which could have a material adverse impact on our business, results of operations, and cash flows.
U.S. Energy Storage Regulation and Legislation
U.S. federal, state, and local authorities continue to review, implement, and modify policies, incentives, regulations, and legislation that can affect the economics and deployment of energy storage, including through tax credits, permitting and interconnection rules, and wholesale market participation frameworks. The timing, interpretation, and implementation of these programs can vary across administrations and may involve phased guidance and rulemaking over time. As a result, there can be uncertainty regarding eligibility, compliance requirements, and the timing and magnitude of benefits available to any particular project. We cannot guarantee we will realize any or all of the anticipated benefits or incentives under any such enacted regulations or legislation. These uncertainties can affect customer decision timelines, the ability to structure and finance projects, and the documentation required to support credit eligibility and monetization.
The IRA, adopted by the U.S. Congress in August 2022, contained a number of tax incentive provisions that directly support the adoption of energy storage solutions and services. Before the enactment of the IRA, the Section 48 ITC did not apply to standalone energy storage projects. The IRA added Section 48(a)(3)(A)(ix) to allow a taxpayer that placed in service a standalone energy storage technology with a minimum capacity of 5 kWh to claim the ITC, if certain requirements are met.
Projects may also qualify for increased credit amounts and bonus credits, subject to detailed requirements. For example, projects may be eligible for increased credit amounts where prevailing wage and apprenticeship requirements are satisfied, and certain projects may qualify for bonus credits, including domestic content, subject to applicable rules and certification
requirements. The IRS continues to publish and update guidance and resources that can affect the application of these rules to energy storage projects.
In 2025, Congress enacted the OBBBA, which introduced additional changes and compliance considerations affecting energy related tax incentives. Among other items, the OBBBA imposed FEOC/PFE concepts and related restrictions that apply to Technology Neutral Credits under Sections 45Y and 48E of the Code and the advanced manufacturing credit under Section 45X of the Code, including ownership, debt, and effective control restrictions (including through the grant of rights through various agreements or licensing rights that are otherwise retained by such entities) in respect of PFEs. The OBBBA also limits the availability of Technology Neutral Credits for projects that receive material assistance from a PFE. The applicability of the FEOC/PFE restrictions is dependent on statutory effective dates and project timing, including beginning of construction dates. Legacy credits under Sections 45 and 48 of the Code for projects that began construction by December 31, 2024 are generally governed under the prior framework, subject to applicable rules, and are not subject to the FEOC/PFE restrictions. The U.S. Department of Treasury and IRS guidance in this area continues to evolve, including guidance addressing FEOC/PFE restrictions. Additional rulemaking and market practice may affect how these requirements are applied and documented. We cannot guarantee we will realize any or all of the anticipated benefits or incentives under any such enacted regulations or other guidance. We continue to monitor these developments.
Third-Party Project Delivery
In our third-party business, we primarily rely on two models for project delivery, which are (i) EPC delivery and (ii) EEQ delivery. Under the EPC model, we generally rely on third-party EPC firms to construct our storage systems, under our supervision with dedicated teams tasked with project management. Under the EEQ model, we are responsible for the delivery of the equipment we provide, as well as resolving issues within our scope of supply.
Our cost projections for our third-party business and for our owned projects are heavily dependent upon raw materials (such as steel), equipment (such as motors, batteries, inverters, and power electronic devices), and technical and construction service providers (such as engineering, procurement, construction firms). Changes in the cost or availability of these inputs, including due to tariffs, supply constraints, or inflation, can affect project pricing, delivery schedules, and margins, depending on contract terms and the timing of procurement.
Energy Storage Industry
The utility scale energy storage industry continues to expand, driven by increased demand for electricity, global transitions toward renewable energy, and increased focus on grid resilience.
Recent reliability sector publications, including the North American Electric Reliability Corporation 2025 Long Term Reliability Assessment published in January 2026, indicate that load growth expectations have increased meaningfully, with data centers, electrification, and new large industrial and manufacturing facilities among the most cited drivers of incremental demand.
In December 2025, the Australian Energy Market Operator published the Draft 2026 Integrated System Plan, which describes development pathways for the National Electricity Market through 2050. The Draft 2026 Integrated System Plan indicates that material growth in dispatchable capacity and energy storage is expected to be required to support reliability and the integration of higher levels of renewable generation over time, reflecting ongoing expansion in the market for utility scale energy storage.
Over the past decade, deployment of renewable energy resources has accelerated and there has been an industry wide push for decarbonization, which is increasing the demand for grid scale energy storage. A major obstacle to transitioning to renewable sources of energy such as wind and solar is the intermittent availability of these types of energy sources. Energy storage solutions are needed to balance the production intermittency of variable renewable energy to support a clean energy future and a balanced electrical grid infrastructure. Both government mandates and companies focused on reducing energy use, cost, and emissions are expected to propel the shift to renewable sources of power.
Additionally, software solutions play a vital role in assisting energy storage owners in managing the growing complexities of renewable energy and energy storage markets. As renewable and energy storage asset portfolios expand globally, these stakeholders will need software solutions that enhance asset performance and boost revenue while reducing total ownership costs.
Our expansion of revenue depends on the ongoing adoption of energy storage solutions by our customers and our ability to source, execute, and operate energy storage projects with attractive economics. The growth of the energy storage market that we address is primarily driven by the decreasing cost of energy storage technologies, government mandates, financial incentives to reduce greenhouse gas emissions, and efforts to enhance grid stability and efficiency. These dynamics are driving demand for increased energy storage capacity and duration.
Competition
The market for our products and services is competitive, and we may face increased competition as new and existing competitors introduce energy storage solutions, components, and project delivery models. Competitive dynamics in the battery energy storage market continue to be influenced by manufacturing scale, changes in battery and component pricing, vertical integration, and evolving trade and supply chain conditions, which can increase pricing pressure, compress margins, and affect delivery timelines. In addition, as we expand our Own and Operate activities through Asset Vault, we also compete with existing and emerging independent power producers, developers, and asset owners for project sites, interconnection capacity, offtake arrangements, and project financing. As we expand our software and services offerings, we also face competition from software providers, original equipment manufacturers, and integrators that offer software enabled controls, optimization, and asset management solutions. If we are not able to compete effectively, if our market share declines due to increased competition, or if competition reduces margins or delays project execution, our revenue, results of operations, and ability to generate profits and cash flows could be adversely affected.
Regulatory Environment and Compliance
Federal, state, and local statutes and regulations concerning electricity materially influence the market for our products and services. These requirements directly affect our owned asset business and indirectly affect our third party sales business, particularly with respect to permitting, siting, and interconnection of energy storage systems, as well as compliance with applicable codes and safety standards. Regulatory frameworks also affect how energy storage participates in wholesale markets, including market rules administered by regional transmission organizations and independent system operators and related Federal Energy Regulatory Commission oversight, which can influence dispatch, revenues, and operational requirements for storage resources.
Each of our owned installations and our customers' installations must be designed, constructed, and operated in compliance with applicable federal, state, and local regulations, codes, standards, guidelines, and laws. To develop, install, and operate energy storage systems, we, our customers, or our partners, as applicable, are required to obtain permits and approvals from authorities having jurisdiction, including zoning and land use approvals, building and electrical permits, fire and life safety approvals, and environmental permits where applicable. Energy storage systems typically require interconnection studies and agreements with the applicable transmission provider or local utility, and interconnection timelines and requirements may be affected by evolving interconnection processes and reforms.
Recent Developments
Asset Vault
In October 2025, we launched Asset Vault, a fully consolidated subsidiary dedicated to developing, building, owning, and operating energy storage assets. In support of this strategy, we entered into a preferred equity investment arrangement with Orion Infrastructure Capital and affiliated funds (collectively "OIC"), providing a $300 million capital framework to fund the acquisition and development of a portfolio of energy storage assets. Asset Vault supports a vertically integrated model in which the Company can self-perform EPC activities and provide long-term service arrangements, while also owning and operating assets to generate recurring cash flows, subject to project financing, permitting, interconnection, offtake execution, and other factors. Additionally, pursuant to the contribution agreement, in exchange for 1.2 billion common units of Asset Vault, Energy Vault contributed to Asset Vault:
•100% of the equity interests of Calistoga Resiliency Center Holdco, LLC;
•100% of the equity interests of Cross Trails Energy Storage Project Holdco, LLC;
•100% of the equity interests of Energy Vault Stoney Creek HoldCo Pty Ltd;
•100% of the equity interests of Energy Vault Stoney Creek Holdings Unit Trust;
•and 100% of any right, title, and interest in a certain future battery energy storage system following its acquisition by Energy Vault.
Pursuant to the Contribution Agreement, in connection with OIC's initial contribution of $35.0 million with respect to its Series A Preferred Units, the Company issued to OIC an aggregate of 5.6 million warrants to purchase common stock of the Company at an exercise price of $4.24 per share. OIC's warrants are entitled to a cashless exercise, are subject to a three-year holding period, and are exercisable until October 9, 2030.
SOSA
On October 23, 2025, the Company acquired all of the membership interests in SOSA from Savion, LLC ("Savion") pursuant to a membership interest purchase agreement. The acquisition provides the Company with development rights to a 150 MW / 300 MWh BESS ("SOSA BESS") to be located in Madison County, Texas.
The purchase price for the membership interests consists of both upfront and contingent components. The Company paid $4.7 million at closing. In addition, the member interest purchase agreement provides for a contingent consideration payment due within 30 days of the SOSA BESS reaching commercial operations. Under the membership interest purchase agreement, the total purchase price is $6.3 million if the SOSA BESS reaches commercial operations before June 1, 2026, or $5.7 million if it reaches commercial operations after June 1, 2026. Construction on the SOSA BESS began in early January 2026 and the Company currently expects it to reach commercial operations in the second quarter of 2027, therefore the final purchase price is expected to be $5.7 million.
EBOR New South Wales Project
In February 2026, we and our Australian development partner, Bridge Energy Pty Ltd, were awarded a 14-year Long-Term Energy Service Agreement by AusEnergy Services for the Ebor Battery Energy Storage System project in New South Wales, Australia. The 100 MW / 870 MWh project is expected to provide eight hours of dispatchable capacity and is expected to commence operations in 2028, subject to obtaining necessary contractual and regulatory approvals. We hold an exclusive option to acquire and construct the project, which will utilize our proprietary B-VAULT technology and EMS, and will be owned and operated under our Asset Vault platform.
Strategic Development Agreement with Peak Energy
On February 9, 2026, we announced that we executed a definitive supply agreement with Peak Energy securing 1.5 gigawatt-hours of Peak Energy's U.S. manufactured sodium-ion battery systems.
Strategic Framework Agreement with Crusoe
On February 11, 2026, we announced a strategic framework agreement with Crusoe, Inc. ("Crusoe") for the phased deployment of Crusoe Spark modular data centers at Energy Vault's technology center in Snyder, Texas. The initial program is scalable up to 25 MWs of total load to be operated inside Crusoe's proprietary Spark modular AI factory product, with planned deployments expected in 2026.
Issuance of Convertible Debentures
In three transactions from September 22, 2025 to December 30, 2025, we issued an aggregate of $65.0 million of convertible debentures (the "Convertible Debentures") to YA PN II, Ltd., an affiliate of Yorkville Advisors Global, LP. On February 19, 2026, we redeemed approximately $45.0 million of the Debentures. Refer to "Liquidity and Capital Resources-Sources of Liquidity-Convertible Debentures" below for additional information.
Issuance of 5.250% Senior Convertible Notes due 2031
On February 17, 2026, we closed an upsized offering of $140.0 million of our 5.250% Senior Convertible Notes due 2031 (the "Senior Convertible Notes") in a private placement to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act. The offering was upsized from the previously announced offering size of $125.0 million aggregate principal amount of Senior Convertible Notes. The initial purchasers subsequently exercised their option to purchase an additional $10.0 million of Senior Convertible Notes, in a transaction that closed on February 27, 2026. Refer to "Liquidity and Capital Resources-Sources of Liquidity-Convertible Senior Notes" below for more information.
Key Operating Metrics
The following tables present our key operating metrics for the periods presented (value in thousands):
| Year Ended December 31, 2025 | Year Ended December 31, 2024 | ||||||||||||||||||||||
| Value | MWh | Value | MWh | ||||||||||||||||||||
| Net Bookings | |||||||||||||||||||||||
| Contracted bookings | $ | 579,853 | 1,226 | $ | 406,183 | 1,281 | |||||||||||||||||
| Contingent option bookings | 489,960 | 800 | - | - | |||||||||||||||||||
| Cancellations | - | - | (182,238) | (400) | |||||||||||||||||||
| Net bookings | $ | 1,069,813 | 2,026 | $ | 223,945 | 881 | |||||||||||||||||
|
December 31, 2025
|
December 31, 2024
|
||||||||||||||||||||||
| Value | MWh | Value | MWh | ||||||||||||||||||||
| Developed Pipeline | $ | 2,409,374 | 5,152 | $ | 2,085,908 | 9,194 | |||||||||||||||||
|
Backlog (1)
|
1,305,515 | 3,399 | 433,886 | 1,574 | |||||||||||||||||||
__________________
(1)Backlog as of December 31, 2025 includes $490.0 million related to a project where the Company has the exclusive right to exercise an option to acquire the project and the Company intends to exercise its option.
Bookings
Net bookings represent the sum of contracted bookings and contingent option bookings, net of cancellations, measured in total aggregate contract value and total MWhs. Contracted bookings are from customer contracts signed during the period. Contingent option bookings are from projects where the Company holds an enforceable exclusive purchase right and intends to exercise that right, even if the option has not been exercised as of period end.
The aggregate contract value includes any potential future variable payments from tolling and offtake arrangements that the Company believes are probable of being realized. Probable future variable payments are forecasted by an independent third-party firm using simulation software that factors in current and projected energy market dynamics, historical and forecasted volatility, and location specific data. The Company considers the low-end simulation results to be probable. Potential future IP royalties are not included in bookings. Due to the long-term nature of our contracts, bookings are a key metric that allows us to understand and evaluate the growth of our Company and our estimated future revenue related to our customer contracts.
Developed Pipeline
Developed pipeline represents uncontracted potential revenue from third-party projects where potential prospective customers have either awarded the Company a project or shortlisted the Company for consideration. It also includes potential tolling revenue from projects where the Company is in advanced negotiations to build, own, and operate energy storage systems. Developed pipeline is an internal management metric that we construct using information from our global sales team and is monitored by management to understand the potential anticipated growth of our Company and to estimate potential future revenue. Developed pipeline is influenced by the prevailing foreign exchange rates and equipment prices and may vary from period to period if these inputs change.
Developed pipeline may not generate margins equal to our historical operating results. We have only recently begun to track our developed pipeline on a consistent basis as a performance measure, and as a result, we do not have significant experience in determining the level of realization that we may achieve on these potential contracts. Our customers may experience project delays or cancel orders as a result of external market factors and economic or other factors beyond our control.
Backlog
Backlog represents (i) contracted but unrecognized revenue from third party projects and services yet to be completed, (ii) unrecognized revenue or other income from IP licensing agreements, and (iii) unrecognized revenue from tolling arrangements for projects operated by Energy Vault or affiliates, in each case, that is associated with contracted bookings and contingent option bookings (as defined above). Backlog includes contracted backlog and contingent option backlog. Contracted backlog reflects unrecognized revenue associated with binding, fully executed agreements. Contingent option backlog reflects unrecognized revenue associated with projects where the Company holds an enforceable exclusive purchase right and intends to exercise that right, even if the option has not been exercised as of period end, and is contingent on the Company exercising the applicable purchase right and subsequent project execution. If the Company
does not exercise an option, or if the underlying terms or assumptions change such that inclusion is no longer appropriate, the related contingent option backlog is removed or updated in the period of change.
Backlog includes any potential future variable payments from tolling and offtake arrangements that the Company believes are probable of being realized. Probable future variable payments are forecasted by an independent third-party firm using simulation software that factors in current and projected energy market dynamics, historical and forecasted volatility, and location specific data. The Company considers the low-end simulation results to be probable. Potential future IP royalties are not included in backlog. Backlog is a common measurement used in our industry. Our methodology for determining backlog may not, however, be comparable to the methodologies used by others.
We cannot guarantee that our bookings, backlog, or developed pipeline will result in actual revenue in the originally anticipated period, or at all. Our customers may experience project delays or cancel orders as a result of external market factors and economic or other factors beyond our control. Many of our projects require government approvals, third-party financing, and other contingencies, many of which are beyond our control. If our bookings, backlog, or developed pipeline fail to result in revenue as anticipated or in a timely manner, we could experience a reduction in revenue, profitability, and liquidity. See "Risk Factors - Our total backlog, bookings, and developed pipeline may not be indicative of our future revenue, which could have a material impact on our business, financial condition, and results of operations" in this Annual Report.
Key Components of Results of Operations
Revenue
The Company generates revenue from the sale of our energy storage products, tolling arrangements related to owned projects, the licensing of the Company's software solutions and IP, and from long-term service agreements to operate and maintain customer owned energy systems. To date, the Company has primarily generated revenue from the sale of our BESSs and from licensing our IP.
The Company sells its BESSs under (i) an EPC model and (ii) an EEQ model. When the Company sells a BESS under the EPC model, the Company recognizes revenue over time as we transfer control of our product to the customer. Under an EEQ model, the Company recognizes revenue related to equipment sales upon delivery to the customer and service revenue over time as we provide specialized technical services to the customer.
The Company enters into tolling and power purchase agreements ("PPA") under which counterparties may sell energy stored in the Company's energy storage systems or request that the Company dispatch energy on their behalf. Each agreement is evaluated to determine whether it qualifies as a lease under Accounting Standards Codification ("ASC") 842, Leases("ASC 842") or a customer contract under ASC 606, Revenue from Contracts with Customers("ASC 606"). As of December 31, 2025, two energy storage systems were operating commercially: one accounted for as an operating lease under ASC 842 and one accounted for as a customer contract under ASC 606.
For the arrangement accounted for under ASC 606, fixed consideration is recognized on a straight-line basis over the contract term. For the arrangement accounted for as a lease under ASC 842, fixed consideration is recognized as operating lease revenue on a straight-line basis over the lease term and variable lease payments are recognized in the period the underlying energy is delivered.
When the Company licenses its IP, revenue is recognized at the point in time at which the customer obtains control of the licensed technology. When the Company licenses its software solutions or provides operation and maintenance services, the transaction price for each contract is recognized as revenue on a straight-line basis over the term of the contract.
Our revenue is affected by changes in the price, volume, and mix of products and services purchased by our customers, which is driven by the demand of our products, geographic mix of our customers, strength of competitor's product offerings, and the availability of government incentives to the end-users of our products.
Our revenue growth is dependent on continued growth in the number of energy storage systems constructed each year and our ability to increase our share of demand in the geographic regions where we currently compete and plan to compete in the future. Additionally, our revenue growth is dependent on our ability to find attractive projects to build, own, and operate.
Cost of Revenue
Cost of revenue primarily consists of product costs, materials and supplies, depreciation and amortization, and costs associated with subcontractors, direct labor, and product warranties. Product costs include the cost of purchased equipment, as well as tariffs and shipping costs directly attributable to that equipment.
Our cost of revenue is affected by underlying costs of equipment and materials such as batteries, inverters, enclosures, transformers, and cables, as well as the cost of subcontractors to provide construction services. We do not currently hedge against changes in the price of raw materials as we do not purchase raw materials. We purchase energy storage system components from our suppliers.
Gross Profit and Gross Profit Margin
Gross profit and gross profit margin may vary from period to period due to the timing of transferring control of significant uninstalled equipment to customers under contracts to sell energy storage systems. When control of significant uninstalled equipment is transferred to customers in a EPC project, the Company recognizes revenue in an amount equal to the cost of that equipment. The profit margin inherent in these materials is deferred until the Company fulfills its obligation to install the materials during construction of the energy storage systems. Generally, margins in an EPC project are lower in the beginning and middle stages as the equipment is delivered, and margins are higher in the later stages as the Company performs the construction, installation, and commissioning services. As a result, gross profit and gross profit margin will vary from period to period.
Additionally, gross profit and gross profit margin may vary from period to period due to our sales volume, product prices, product costs, product mix, geographical mix, and change in estimates for warranty liabilities.
Sales and Marketing ("S&M") Expenses
S&M expenses consist primarily of internal personnel-related costs for marketing, sales, and related support teams, as well as external costs such as professional service fees, trade shows, marketing and sales-related promotional materials, public relations expenses, and website operating and maintenance costs. Personnel-related expenses include salaries, benefits, and stock-based compensation expenses.
Research and Development ("R&D") Expenses
R&D expenses consist primarily of internal and external expenses incurred in connection with our research activities and development programs that include material costs directly related to product development, testing and evaluation costs, construction costs including labor and transportation of material, overhead related costs and other direct expenses consisting of personnel-related expenses and consulting expenses relating to study of product safety, reliability and development. Personnel-related expenses consist of salaries, benefits, and stock-based compensation expense.
General and Administrative ("G&A") Expenses
G&A expenses consist of information technology expenses, legal and professional fees, travel costs, and personnel-related expenses for our corporate, executive, finance, and other administrative functions, including expenses for professional and contract services. Personnel-related expenses consist of salaries, benefits, and stock-based compensation expense. To a lesser extent, general and administrative expenses include investor relations costs, insurance costs, rent, office expenses, and maintenance costs.
Provision for Credit Losses
Provision for credit losses represents the expense recognized to account for potential losses on accounts receivable, contract assets, and customer financing receivable due to customer defaults or credit deterioration. This provision reflects management's estimate of expected credit losses based on historical trends and forward-looking assessments.
Depreciation, Amortization, and Accretion Expense (Excluding Amounts Included in Cost of Revenue)
Depreciation, amortization, and accretion expense consists of depreciation associated with property and equipment (excluding energy storage system depreciation which is included in cost of revenue), amortization of intangible assets, and accretion of an asset retirement obligation.
Change in fair value of financial instruments carried at fair value
Change in fair value of financial instruments carried at fair value represents a gain or loss from the change in fair value of the Company's convertible debentures, warrant liabilities, and derivative assets and liabilities.
Interest Expense
Interest expense consists of contractual interest expense and amortization of non-cash debt and financing costs related to short and long-term loans, insurance premium financings, and finance leases.
Interest Income
Interest income primarily consists of interest income from our money market funds and interest-bearing savings accounts.
Other income (expense)
Other income (expense) includes foreign currency gains and losses and non-recurring non-operating gains and losses.
Results of Operations
Consolidated Comparison of Year Ended December 31, 2025 to December 31, 2024
The following table sets forth our results of operations for the periods indicated (amounts in thousands):
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | $ Change | |||||||||||||||
| Revenue | $ | 203,671 | $ | 46,199 | $ | 157,472 | |||||||||||
| Cost of revenue | 155,681 | 40,012 | 115,669 | ||||||||||||||
| Gross profit | 47,990 | 6,187 | 41,803 | ||||||||||||||
| Operating expenses: | |||||||||||||||||
| Sales and marketing | 13,698 | 15,839 | (2,141) | ||||||||||||||
| Research and development | 14,635 | 25,999 | (11,364) | ||||||||||||||
| General and administrative | 81,180 | 62,971 | 18,209 | ||||||||||||||
| Provision for credit losses | 9,409 | 29,980 | (20,571) | ||||||||||||||
| Depreciation, amortization, and accretion (excluding amounts included in cost of revenue) | 3,435 | 1,058 | 2,377 | ||||||||||||||
| Loss on impairment and sale of long-lived assets | - | 336 | (336) | ||||||||||||||
| Total operating expenses | 122,357 | 136,183 | (13,826) | ||||||||||||||
| Loss from operations | (74,367) | (129,996) | 55,629 | ||||||||||||||
| Other income (expense): | |||||||||||||||||
| Interest expense | (8,464) | (123) | (8,341) | ||||||||||||||
| Interest income | 1,100 | 5,537 | (4,437) | ||||||||||||||
| Change in fair value of financial instruments carried at fair value | (8,179) | (1,025) | (7,154) | ||||||||||||||
| Impairment of equity securities | - | (11,730) | 11,730 | ||||||||||||||
| Other income (expense), net | (5,985) | 1,591 | (7,576) | ||||||||||||||
| Loss before income taxes | (95,895) | (135,746) | 39,851 | ||||||||||||||
| Provision for income taxes | 7,763 | 67 | 7,696 | ||||||||||||||
| Net loss | $ | (103,658) | $ | (135,813) | $ | 32,155 | |||||||||||
Revenue
The Company recognized revenue for the product and service categories as follows for theyearsended December 31, 2025 and 2024 (amounts in thousands):
| Year Ended December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Sale of energy storage products | $ | 196,198 | $ | 44,592 | |||||||
| Tolling and PPA revenue | 2,337 | - | |||||||||
| Operation and maintenance services | 1,284 | 1,090 | |||||||||
| Software licensing | 540 | 402 | |||||||||
| IP licensing | 3,312 | 115 | |||||||||
| Total revenue | $ | 203,671 | $ | 46,199 | |||||||
Revenue for the year ended December 31, 2025 was $203.7 million, an increase of $157.5 million from $46.2 million for the year ended December 31, 2024. The increase was primarily driven by a $151.6 million increase in energy storage product sales due to the ramp-up of the Company's EPC projects in Australia and the completed delivery of equipment under an EEQ contract in the U.S., a $3.2 million increase in IP licensing revenue following the B-VAULT licensing agreement in the first quarter of 2025, and $2.3 million of tolling and PPA revenue from the Cross Trails and CRC, which both began commercial operations in 2025.
Revenue from two customers accounted for 56% and 32% of total revenue, respectively, for the year ended December 31, 2025 and revenue from two customers accounted for 75% and 19% of total revenue, respectively, for the year ended December 31, 2024.
Cost of Revenue
Cost of revenue for the year ended December 31, 2025 was $155.7 million, an increase of $115.7 million from $40.0 million for the year ended December 31, 2024. The increase was primarily driven by higher costs from energy product sales, consistent with the ramp up of energy storage product sales in 2025.
Gross Profit and Gross Profit Margin
Gross profit for the year ended December 31, 2025 was $48.0 million, an increase of $41.8 million from $6.2 million for the year ended December 31, 2024. The increase was driven primarily by higher contributions from energy storage product sales, higher margin IP licensing revenue, and lower warranty expense compared to the prior year, including a favorable adjustment in 2025 resulting from a change in estimated warranty costs. These favorable impacts were partially offset by higher depreciation and amortization expense associated with Cross Trails and CRC, which began commercial operations in 2025.
Gross profit margin increased to 23.6% for the year ended December 31, 2025 from 13.4% for the year ended December 31, 2024, primarily reflecting higher margins on energy product sales, a higher mix of IP licensing revenue in 2025, which carries no associated cost of revenue, and lower warranty expense compared to the prior year.
Sales and Marketing Expenses
Sales and marketing expenses for the year ended December 31, 2025 were $13.7 million, a decrease of $2.1 million from $15.8 million for the year ended December 31, 2024. The decrease was driven primarily by cost control measures and lower S&M headcount, which together reduced personnel-related expenses by $0.5 million, consulting fees by $0.5 million, and external marketing and public relations costs by $0.7 million.
Research and Development Expenses
Research and development expenses for the year ended December 31, 2025 were $14.6 million, a decrease of $11.4 million from $26.0 million for the year ended December 31, 2024. The decrease was driven primarily by cost control measures and lower R&D headcount, which reduced personnel-related expenses by $7.0 million, engineering and development costs by $3.3 million, and software costs by $0.5 million.
General and Administrative Expenses
General and administrative expenses for the year ended December 31, 2025 were $81.2 million, an increase of $18.2 million from $63.0 million for the year ended December 31, 2024. The increase was driven primarily by higher personnel-related costs of $12.1 million due to increased G&A headcount, a $3.0 million increase in legal and professional fees, a
$1.6 million increase in project development costs, a $0.9 million increase in consulting costs, and a $0.6 million increase in software costs. The increase in G&A headcount and costs are primarily related to the Company's strategic shift toward an Own & Operate business model.
Provision for Credit Losses
Provision for credit losses for the year ended December 31, 2025 was $9.4 million, a decrease of $20.6 million from $30.0 million for the year ended December 31, 2024. In 2025, the provision for credit losses was driven by a $5.5 million provision related to the Company's customer financing receivable and $3.8 million related to the Company's convertible note receivable from DG Fuels. The Company fully reserved the customer financing receivable in 2025 due to continued non-collection from the customer, and the Company fully reserved the DG Fuels convertible note receivable and accrued interest due to the investee's financial difficulties.
In 2024, the provision for credit losses was driven by a $24.1 million provision related to a refundable deposit advanced to a customer and a $4.7 million provision related to the Company's customer financing receivable.
Depreciation, Amortization, and Accretion Expense (Excluding Amounts Included in Cost of Revenue)
Depreciation, amortization, and accretion expense (excluding amounts included in cost of revenue) for the year ended December 31, 2025 was $3.4 million, an increase of $2.4 million from $1.1 million for the year ended December 31, 2024. The increase was driven primarily by depreciation on the Snyder CDU, which was placed into service in 2025.
Interest Expense
Interest expense for the year ended December 31, 2025 was $8.5 million, an increase of $8.3 million from $0.1 million for the year ended December 31, 2024. The increase in interest expense for the year ended December 31, 2025 reflects higher interest costs associated with debt financings obtained in 2025, whereas in 2024 the Company's borrowings were limited to insurance premium financing arrangements with minimal interest costs.
Interest Income
Interest income for the year ended December 31, 2025 was $1.1 million, a decrease of $4.4 million from $5.5 million for the year ended December 31, 2024. The decrease in interest income for the year ended December 31, 2025 reflects lower average interest-bearing cash balances compared to 2024.
Change in Fair Value of Financial Instruments Carried at Fair Value
Change in fair value of financial instruments carried at fair value was a loss of $8.2 million for the year ended December 31, 2025, an increase of $7.2 million compared to a loss of $1.0 million for the year ended December 31, 2024. The loss in 2025 was driven by a $4.4 million loss on the Company's convertible debentures and a $3.8 million loss on the Company's liability-classified warrants. The loss in 2024 was fully attributable to the change in fair value of the Company's conversion option in DG Fuels accounted for as a derivative.
Other Income (Expense), Net
Other expense, net for the year ended December 31, 2025 was $6.0 million, a change of $7.6 million from other income, net of $1.6 million for the year ended December 31, 2024. Other expense, net for the year ended December 31, 2025 primarily reflects $2.1 million in costs related to selling shares under the Hudson Equity Purchase Agreement, $1.9 million in transaction costs that were expensed related to the issuance of the redeemable non-controlling interest, a $1.5 million loss on debt extinguishment, and $1.1 million of foreign exchange losses, partially offset by a $0.4 million gain on the sale of R&D equipment.
Other income, net for the year ended December 31, 2024 primarily reflects a $1.5 million gain recognized on the derecognition of a related-party contract liability.
Provision for Income Taxes
Provision for income taxes for the year ended December 31, 2025 was $7.8 million, an increase of $7.7 million from $0.1 million for the year ended December 31, 2024. The increase in the income tax provision primarily relates to a valuation allowance recorded against the Company's deferred tax assets to reduce the Company's ITCs to their net realizable value upon their transfer to a third-party purchaser.
Liquidity and Capital Resources
Sources of Liquidity
Historically, Energy Vault has financed its net cash used in operating and investing activities primarily through the issuance and sale of equity, proceeds from the reverse recapitalization and private investment in public equity ("PIPE")
transaction completed in 2022, and debt financings. In 2025, we also entered into a preferred equity investment arrangement at Asset Vault to support the development, acquisition, and ownership of energy storage assets.
For corporate-level liquidity, we have accessed unsecured debt financings. Our indebtedness ranks senior to our common equity. If we raise additional funds through the issuance of debt securities, such instruments could also rank senior to our common equity and may include covenants or other terms that impose restrictions on our operations. Volatility in the credit markets and broader financial services sector could impact the availability and cost of both debt and equity financing in the future.
In addition to corporate-level liquidity, in 2025 we launched Asset Vault, a fully consolidated subsidiary dedicated to developing, building, owning, and operating energy storage assets. In support of this strategy, we entered into a preferred equity investment arrangement with OIC, providing a $300 million capital framework to fund the acquisition and development of a portfolio of energy storage assets. We have raised, and expect to continue to raise, project-level capital to support the development, construction, ownership, and operation of energy storage assets, including through Asset Vault and other project-specific financing vehicles. Such project-level capital has included preferred equity and project-level secured debt incurred by the subsidiaries that hold the applicable project assets (including subsidiaries of Asset Vault). This project-level debt is generally secured by the underlying energy storage systems and related project assets and is intended to be supported by, and repaid from, project cash flows, and may include customary limited-recourse provisions (including specified sponsor or project-party indemnities and other limited obligations) rather than full recourse to Energy Vault Holdings, Inc. While project-level financing can enable us to scale owned-asset deployments and manage corporate liquidity needs, the availability and cost of such financing depend on a variety of factors, including project readiness, permitting and interconnection status, contracted offtake and other revenue arrangements, counterparty credit, market conditions and interest rates, and evolving tax credit eligibility requirements and trade policy.
To support non-cash backed performance bonding and surety obligations required under project EPC agreements, the Company partners with Marsh to access bonding and surety instruments issued by top-rated insurance firms. .
As part of our ongoing business operations, the Company had a sales backlog of $1.3 billion as of December 31, 2025. Management expects this backlog to contribute to the future funding of our business, supported by a robust developed pipeline, which we anticipate to convert into additional contracted backlog as new agreements are executed.
Energy Vault has historically incurred negative operating cash flows and operating losses and may continue to incur operating losses in the future. The Company may seek to raise additional capital through combinations of equity and/or debt financings, subject to prevailing market conditions. Issuance of equity securities could result in dilution to existing stockholders and may include rights, preferences, or privileges senior to those of the Company's common stock.
Management believes that its cash, cash equivalents, and restricted cash as of December 31, 2025, together with expected cash flows from operations and existing funding arrangements, will be sufficient to fund operating activities and meet obligations for at least the next twelve months from the date of issuance of these consolidated financial statements. This assessment does not assume any future proceeds from the exercise of outstanding warrants.
Tax Credit Transfer Commitment
On March 28, 2025, the Company entered into a Tax Credit Transfer Commitment, on behalf of its majority and wholly-owned subsidiary companies, with a third-party purchaser pursuant to which the Company agreed to sell the ITCs generated by CRC, Cross Trails and the Snyder CDU. On February 26, 2026, the Company collected $11.8 million in proceeds from the transfer of the Cross Trails ITC to the third-party purchaser. As of the date of the Annual Report, the sales of the eligible ITCs generated by the CRC HESS and Snyder CDU are expected to close following the satisfaction of certain customary closing conditions.
At-the-Market Facility and Equity Purchase Agreements
On November 12, 2024, we entered into an open market sales agreement ("Sales Agreement") with Jefferies LLC, as sales agent (the "Sales Agent"), pursuant to which we may, from time to time, sell shares of our common stock, having an aggregate offering price of up to $50.0 million through the Sales Agent under an "at-the-market" equity offering program. We may seek, from time to time, to raise additional capital either under the Sales Agreement or otherwise.
On March 31, 2025, we entered into the Hudson Equity Purchase Agreement. Pursuant to the Hudson Equity Purchase Agreement, the Company has the right at its sole discretion, but not the obligation, to sell to Hudson, and Hudson is obligated to purchase, up to $25.0 million of newly issued shares of the Company's common stock, from time to time during the term of the Hudson Equity Purchase Agreement, subject to certain limitations and conditions.
In connection with the Hudson Equity Purchase Agreement, the Company entered into a Registration Rights Agreement, pursuant to which the Company agreed to register the Commitment Shares and the shares issuable pursuant to the Hudson
Equity Purchase Agreement. The securities to be offered pursuant to the Hudson Equity Purchase Agreement will be offered pursuant to our effective shelf registration statement on Form S-3/A (File No. 333-273089), which was filed with the SEC on July 14, 2023 and declared effective on July 20, 2023.
During the year ended December 31, 2025, the Company received proceeds of $6.8 million from the sale of common stock under the Hudson Equity Purchase Agreement.
On August 6, 2025, the Company entered into the Helena Purchase Agreement. Pursuant to the Helena Purchase Agreement, the Company has the right, but not the obligation, to sell to Helena, and Helena is obligated to purchase, up to $25.0 million of newly issued shares of the Company's common stock, from time to time over a 36-month term, subject to certain limitations and conditions. The obligations under the Helena Purchase Agreement are subject to a standstill period and will not commence until the later of (i) ninety days from the execution of the agreement, or (ii) the termination or expiration of the Company's existing Hudson Equity Purchase Agreement.
The Company's Convertible Debentures (defined in sections below) restrict the Company from selling shares under the Hudson and Helena Equity Purchase Agreements unless the note holder provides consent.
CRC Bridge Loan
On March 31, 2025, CRC, a majority-owned subsidiary of the Company, entered into a $27.8 million credit agreement with Jefferies, as administrative agent, collateral agent, and lender. The CRC Bridge Loan was intended to provide interim financing until long-term debt could be arranged. The CRC Bridge Loan carried a 9.5% annual interest rate and had a scheduled maturity date of April 23, 2025. After deducting closing fees, net proceeds totaled $26.8 million. On April 4, 2025, the Company refinanced the full outstanding balance of the CRC Bridge Loan through the issuance of $27.8 million in CRC Senior Notes (as described below).
CRC Senior Notes
On April 4, 2025, CRC issued $27.8 million of senior notes with Eagle Point Credit as lender and Jefferies serving as agent for the transaction. The CRC Senior Notes were priced at 99.25% of par, resulting in net proceeds of $27.6 million.
The CRC Senior Notes bear interest at 12.5% per annum until the earlier of (i) the Company's receipt of any tax credit transfer proceeds and (ii) December 31, 2025, and thereafter at a rate of 9.50% per annum. The CRC Senior Notes are senior secured obligations of CRC, backed by a first-priority pledge of all CRC assets and equity interests. The CRC Senior Notes include customary affirmative and negative covenants, including minimum cash reserves and a minimum debt service coverage ratio.
Principal and interest are payable semi-annually, with installments due each February 28 and August 31. The Company may, at its option, redeem all or a portion of the CRC Senior Notes prior to maturity, subject to specified call protection provisions and any prepayment premiums set forth in the agreement. In the event of a change of control, the Company may be required to offer to repurchase the notes at a specified price.
Cross Trails Bridge Loan
On May 12, 2025, the Company entered into a secured bridge loan with Crescent Cove for $10.0 million, bearing interest at 24% per annum and with a maturity date of July 14, 2025. The loan was issued net of a 5% original issue discount and a structuring fee of $0.2 million, for net proceeds of $9.3 million. Total interest expense on the loan of $0.4 million was deducted from the loan proceeds. On July 14, 2025, the Company repaid $5.0 million of principal and simultaneously amended the loan to extend the maturity of the remaining $5.0 million to July 21, 2025. In connection with the extension, the Company paid a $0.2 million amendment fee. The remaining principal and additional interest for the extension were paid on July 18, 2025.
Cross Trails Senior Note
On July 23, 2025, Cross Trails, a wholly-owned subsidiary of the Company, entered into a credit agreement with Wilmington Trust, National Association, as administrative agent and collateral agent, and Jefferies Capital Services, LLC, as initial lender.
The Cross Trails Senior Note provides for a senior secured term loan facility in an aggregate principal amount of approximately $17.8 million. After origination costs were deducted from the loan proceeds by the lender, net proceeds from the Cross Trails Senior Note were $17.6 million. The proceeds are intended to support the Cross Trails energy storage project, including payment of operating costs, funding of required reserve accounts, payment of fees and expenses related to the transaction, and certain distributions to the project sponsor or its designee at closing.
The Cross Trails Senior Note is structured as a single-draw term loan, with the full amount funded on July 23, 2025. The borrowing bears interest, at the Company's election, at (i) the Alternate Base Rate ("ABR") plus 5.00% or (ii) the term
Secured Overnight Financing Rate ("SOFR") plus 6.00%. Principal and interest are payable semi-annually, with installments due each February 28 and August 31, beginning on February 28, 2026. The Cross Trails Senior Note matures on July 23, 2032.
The Cross Trails Senior Note may be repaid at any time, subject to payment of accrued interest, breakage costs and a repayment premium. Mandatory prepayments are required upon the occurrence of certain customary events, including the receipt of insurance or condemnation proceeds (subject to customary reinvestment rights), asset sales above specified thresholds, the incurrence of additional non-permitted indebtedness, or the non-permitted issuance of new equity interests by the borrower, and are subject to the payment of accrued interest, breakage costs and a repayment premium.
The obligations under the Cross Trails Senior Note are secured by a first priority security interest in substantially all of the assets of the Cross Trails Borrower, including the project assets, accounts, and related collateral, as well as the membership interests in the Cross Trails Borrower. The Cross Trails Senior Note contains customary affirmative and negative covenants for a project financing of this type, including limitations on additional indebtedness, liens, asset sales, investments, affiliate transactions, and distributions. The Cross Trails Borrower is also required to maintain certain financial ratios, including a minimum debt service coverage ratio of 1.10:1.00, and to maintain insurance, deliver certain financial and other reports, and comply with applicable laws and permits.
The Cross Trails Senior Note also includes customary representations and warranties, indemnification provisions and requirements for the maintenance of insurance and compliance with applicable laws and permits.
Sale of Future Receipts
On August 29, 2025, the Company, together with Energy Vault, Inc., its wholly-owned subsidiary (collectively with the Company, the "Sellers") entered into an agreement of sale of future receipts (the "Cedar Arrangement") with Cedar Advance LLC ("Cedar"). Cedar paid a purchase price of $5.0 million, from which $0.5 million of origination fees were deducted, resulting in net proceeds of $4.5 million. Under the agreement, the Sellers remit to Cedar $0.2 million per week, or approximately 27.0% of future receivables collections, until Cedar has received an aggregate amount equal to (i) $5.1 million if fully repaid within 30 days of funding, (ii) $5.2 million if fully repaid after 30 days but within 60 days of funding, or (iii) $6.3 million if not fully repaid within 60 days of funding.
The Company did not fully repay the Cedar Arrangement within 60 days of funding, therefore the applicable aggregate amount to be remitted to Cedar will be $6.3 million. Through December 31, 2025, the Company had remitted $2.8 million to Cedar, with $3.5 million remaining.
On September 2, 2025, the Sellers entered into an agreement of sale of future receipts (the "UFS Arrangement") with UFS West LLC ("UFS"). UFS paid a purchase price of $1.0 million, from which $0.1 million of origination fees were deducted, resulting in net proceeds of $0.9 million. Under the agreement, the Sellers remit to UFS $35 thousand per week, or approximately 4.9% of future receivables collections, until UFS has received an aggregate amount equal to (i) $1.0 million if fully repaid within 30 days of funding, (ii) $1.0 million if fully repaid after 30 days but within 60 days of funding, or (iii) $1.3 million if not fully repaid within 60 days of funding.
The Company fully repaid the UFS Arrangement on November 4, 2025, which was within 60 days of funding, therefore the applicable aggregate amount remitted was $1.0 million.
On September 4, 2025, the Sellers entered into an agreement of sale of future receipts (the "Reliance Arrangement") with Reliance Financial FL LLC ("Reliance"). Reliance paid a purchase price of $1.5 million, from which $0.2 million of origination fees were deducted, resulting in net proceeds of $1.3 million. Under the agreement, the Sellers remit to Reliance $0.1 million per week, or approximately 1.0% of future receivables collections, until Reliance has received an aggregate amount equal to (i) $1.5 million if fully repaid within 30 days of funding, (ii) $1.6 million if fully repaid after 30 days but within 60 days of funding, or (iii) $1.9 million if not fully repaid within 60 days of funding.
The Company fully repaid the Reliance Arrangement on November 4, 2025, which was within 60 days of funding, therefore the applicable aggregate amount remitted was $1.6 million.
Convertible Debentures
On September 22, 2025, the Company entered into a Securities Purchase Agreement (the "Purchase Agreement") with YA II PN, Ltd. (the "Investor"), pursuant to which the Company agreed to issue senior unsecured convertible debentures in multiple tranches with an aggregate principal amount of up to $50.0 million. On December 30, 2025, the Purchase Agreement was amended to increase the aggregate principal amount to $65.0 million (collectively, the "Convertible Debentures").
The initial tranche of $30.0 million ("Tranche 1") was funded on September 22, 2025 at 97% of par, resulting in net proceeds of $29.1 million. The second tranche of $20.0 million ("Tranche 2") was funded on December 16, 2025 at 97% of
par, resulting in net proceeds of $19.4 million. The third tranche of $15.0 million ("Tranche 3") was funded on December 30, 2025 at 98% of par, resulting in net proceeds of $14.7 million.
Tranches 1 and 2 mature on March 22, 2027 and Tranche 3 matures on August 30, 2027. All three tranches bear interest at 7.0% per annum (18.0% upon an uncured event of default). Installment payments of principal and interest are due monthly (each, a "Payment Date," beginning on the applicable payment commencement date). For each installment, the Company may (i) pay cash plus a payment premium equal to 7.0% (Tranches 1 and 2) or 4.0% (Tranche 3) of the principal portion paid ("Payment Premium") (10.0% while an Amortization Event is in effect, as defined below), (ii) elect to allow the Investor to convert the unpaid installment at a price equal to the lower of (A) the Applicable Fixed Price (defined below) or (B) 97% of the lowest daily VWAP during the four trading days immediately preceding the conversion date, but not below the Floor Price (equal to $0.60 per share), or (iii) satisfy the installment through a combination of cash and conversion.
The fixed conversion price is $4.50 per share for Tranche 1, $7.53 per share for Tranche 2, and $7.41 per share for Tranche 3. For purposes of the redemption and conversion provisions described below, the "Applicable Fixed Price" means the fixed conversion price for the applicable tranche.
On any Payment Date when the Company's daily Bloomberg volume weighted average price ("VWAP") has equaled or exceeded 115% of the Applicable Fixed Price for each of the five prior trading days, no cash installment payment is due on such Payment Date and the related installment is deferred, with the principal remaining outstanding until maturity.
Investor conversions are subject to a beneficial ownership limit of 4.99% of the Company's common stock and to a limit of 19.99% of the Company's outstanding common stock as of closing unless stockholder approval to exceed such cap is obtained in accordance with the rules and regulations of the New York Stock Exchange (the "Exchange Cap"). An "Amortization Event" includes, among other things, (i) the Company's common stock trading below the Floor Price for 5 of 7 consecutive trading days, (ii) issuance of more than 99% of the shares available under the Exchange Cap without stockholder approval, or (iii) beginning 60 days after issuance, the resale registration statement being unusable for 10 consecutive trading days. While an Amortization Event is in effect, the monthly installment must be paid in cash, the applicable payment premium is 10.0%, and the installment amount may increase to the greater of the scheduled amount and 20.0% of then-outstanding principal.
Outside the monthly payment schedule, the Company may optionally redeem the Convertible Debentures upon advance notice for cash when the VWAP is below the Applicable Fixed Price (with the applicable Payment Premium). Upon a change of control, the Company may redeem all outstanding Convertible Debentures at 110% of principal.
In connection with the Purchase Agreement, the Company entered into a registration rights agreement (the "Registration Rights Agreement") with the Investor, pursuant to which the Company agreed to file a registration statement covering the resale of the Common Stock issuable upon conversion of the Convertible Debentures within 10 business days after closing and to use commercially reasonable efforts to obtain effectiveness within 60 days. The Purchase Agreement includes customary covenants and restrictions, including a prohibition on variable-rate transactions while amounts may be or are outstanding, limitations on additional indebtedness and liens subject to agreed exceptions (including specified project-level indebtedness for subsidiaries such as Calistoga and Cross Trails and certain refinancings), and limitations on the Company's use of existing equity lines without Investor consent. The Company may utilize its at-the-market equity ("ATM") program only if specified conditions are satisfied, applying 25.0% of gross ATM proceeds to reduce the Convertible Debentures principal on the back end of the schedule, and observing a cooling-off period of three trading days after an Investor market-price conversion; if the ATM is used in any calendar month, the next scheduled amortization payment will be convertible at the Investor's election. Any subsidiary that directly receives Convertible Debenture proceeds must guarantee the Company's obligations. The Investor agreed not to engage in short sales of the Company's equity, but may sell shares corresponding to submitted conversions.
In February 2026, the Company fully repaid Tranches 2 and 3, and partially repaid Tranche 1 in cash with the proceeds from the Senior Convertible Notes (described below).
Senior Convertible Notes
On February 17, 2026, the Company completed a private offering of $140.0 million aggregate principal amount of 5.250% Senior Convertible Notes due 2031. In addition, the Company issued an additional $10.0 million aggregate principal amount of Senior Convertible Notes pursuant to the initial purchasers' option in a transaction that closed on February 27, 2026. The Senior Convertible Notes bear interest at 5.250% per annum, payable in cash semi-annually in arrears on March 1 and September 1 of each year, beginning on September 1, 2026, and mature on March 1, 2031, unless earlier converted, redeemed or repurchased. In connection with the offering, the Company entered into privately negotiated capped call transactions. After deducting the 3.25% initial purchaser's discount and before the cost of the capped call transactions and offering expenses, the Company received $145.1 million in proceeds. The Company used approximately $20.5 million of
the net proceeds to fund the capped call transactions and paid $3.8 million for advisory and placement agent fees, resulting in net proceeds of $120.8 million.
The Company used a portion of the net proceeds from the Senior Convertible Notes to make aggregate cash payments of $49.7 million to YA II PN, Ltd. in connection with repayments of the Company's Convertible Debentures, comprised of principal, accrued interest, and cash premium. Tranches 2 and 3 were fully repaid. After these payments, unpaid principal remaining outstanding under the Convertible Debentures was $7.9 million. In addition, $5.6 million of principal remained technically outstanding because the Company had delivered conversion notices to the Investor, but the Investor had not yet completed conversion.
The Senior Convertible Notes have an initial conversion rate of 193.1807 shares of common stock per $1,000 principal amount, representing an initial conversion price of approximately $5.18 per share, which represents a conversion premium of approximately 27.5% above the $4.06 closing price of the Company's common stock on February 11, 2026.
The capped call transactions have an initial strike price of approximately $5.18 per share, consistent with the initial conversion price of the Senior Convertible Notes, and an initial cap price of $8.12 per share, which represents a premium of 100% above the $4.06 closing price of the Company's common stock on February 11, 2026. The capped call transactions are expected to reduce potential dilution to the Company's common stock upon any conversion of the Senior Convertible Notes, and/or offset any cash payments the Company is required to make in excess of the principal amount upon conversion, with such reduction and/or offset subject to a cap based on the cap price.
Cash, Cash Equivalents, and Restricted Cash
Our cash equivalents are highly liquid investments purchased with an original or remaining maturities of three months or less.
The following table summarizes our cash, cash equivalents, and restricted cash balances as of December 31, 2025 and 2024(amounts in thousands):
|
December 31,
|
|||||||||||
|
2025
|
2024
|
||||||||||
| Cash and cash equivalents | $ | 58,260 | $ | 27,091 | |||||||
| Restricted cash | 45,183 | 2,982 | |||||||||
| Total cash, cash equivalents, and restricted cash | $ | 103,443 | $ | 30,073 | |||||||
Restricted cash primarily consists of cash deposits held in segregated accounts as collateral for certain debt financing requirements and for guarantees and bonds issued in connection with our customer owned and Company owned projects under development.
Additionally, our contractual arrangements with customers often require us to issue letters of credit, bank guarantees, and performance and payment bonds to secure our performance under those contracts. To collateralize these instruments, we deposit cash in restricted accounts that cannot be used for general corporate purposes until the underlying obligations are settled or the guarantees expire.
The following table summarizes restricted cash balances (amounts in thousands):
|
December 31,
|
|||||||||||
|
2025
|
2024
|
||||||||||
| Restricted cash, current portion | $ | 4,717 | $ | 990 | |||||||
| Restricted cash, long-term portion | 40,466 | 1,992 | |||||||||
| Total restricted cash | $ | 45,183 | $ | 2,982 | |||||||
| Restricted cash related to debt financing | $ | 9,489 | $ | - | |||||||
| Restricted cash related to customer projects | 33,002 | 2,982 | |||||||||
| Other | 2,692 | - | |||||||||
| Total restricted cash | $ | 45,183 | $ | 2,982 | |||||||
Contractual Obligations
Our principal commitments as of December 31, 2025 consisted primarily of obligations under debt financing arrangements, operating leases, finance leases, a deferred pension, warranty liabilities, and issued purchase orders. Our non-cancellable
purchase obligations as of December 31, 2025 totaled approximately $5.4 million, which is all expected to be paid in the next twelve months.
The following table summarizes the cash maturities of the Company's debt instruments as of December 31, 2025 (amounts in thousands):
| 2026 | 2027 | 2028 | 2029 | 2030 | Thereafter | ||||||||||||||||||||||||||||||
| Debt obligations | $ | 54,377 | $ | 19,829 | $ | 2,615 | $ | 3,228 | $ | 3,126 | $ | 16,408 | |||||||||||||||||||||||
Cash Flows
The following table summarizes cash flows from operating, investing, and financing activities for the periods indicated (amounts in thousands):
|
Year Ended December 31,
|
|||||||||||
| 2025 | 2024 | ||||||||||
| Net cash used in operating activities | $ | (5,649) | $ | (55,860) | |||||||
| Net cash used in investing activities | (44,607) | (58,736) | |||||||||
| Net cash provided by (used in) financing activities | 123,050 | (252) | |||||||||
| Effects of exchange rate changes on cash | 576 | (634) | |||||||||
| Net increase (decrease) in cash, cash equivalents, and restricted cash | $ | 73,370 | $ | (115,482) | |||||||
Operating Activities
Net cash used in operating activities was $5.6 million for the year ended December 31, 2025, compared to net cash used in operating activities of $55.9 million for the year ended December 31, 2024.
For the year ended December 31, 2025, net cash used in operating activities reflects a net loss of $103.7 million, adjusted for $74.4 million in non-cash charges, a $56.9 million increase in operating liabilities, and a $33.3 million increase in operating assets.
Significant non-cash items include $36.7 million in stock-based compensation expense, $9.4 million in provision for credit losses, $7.1 million related to the deferred tax asset valuation allowance, $5.7 million in depreciation, amortization, and accretion expense, a $8.2 million loss related to the change in fair value of financial instruments carried at fair value, $3.2 million in non-cash debt and financing costs, $1.9 million in non-cash equity issuance costs related to the Hudson Equity Purchase Agreement, and $1.5 million of loss on debt extinguishment.
The increase in operating liabilities was driven by a $60.0 million increase in accounts payable and accrued expenses, partially offset by a $2.8 million decrease in contract liabilities. The increase in operating assets was driven by a $13.4 million increase in contract assets, an $11.3 million increase in accounts receivable, a $4.5 million increase in advances to suppliers, a $3.0 million increase in other assets, and a $1.1 million increase in prepaid expenses and other current assets.
Net cash used in operating activities for the year ended December 31, 2025 improved compared with the year ended December 31, 2024, primarily reflecting lower net loss due to higher gross profit and favorable timing of payments and accruals within accounts payable and accrued expenses.
Investing Activities
Net cash used in investing activities was $44.6 million for the year ended December 31, 2025, compared to net cash used in investing activities of $58.7 million for the year ended December 31, 2024.
Net cash used in investing activities for the year ended December 31, 2025 consists of $41.1 million for the purchase of property and equipment, primarily for the construction of the Snyder CDU, Cross Trails, and CRC, $2.1 million of loans extended to Stoney Creek prior to its acquisition, and $1.4 million related to the purchase of favorable contract intangible assets as part of the acquisition of SOSA. In 2025, the Company paid $4.7 million to acquire SOSA, of which $3.3 million is presented within purchase of property and equipment and $1.4 million is presented within purchase of intangible assets in the consolidated statement of cash flows.
The decrease in net cash used in investing activities for the year ended December 31, 2025, compared to the year ended December 31, 2024 was driven by lower property and equipment expenditures.
Financing Activities
Net cash provided by financing activities was $123.1 million for the year ended December 31, 2025, compared to net cash used in financing activities of $0.3 million for the year ended December 31, 2024.
Net cash provided by financing activities for the year ended December 31, 2025 was primarily attributable to $151.3 million in proceeds from the issuance of debt, $33.7 million in gross proceeds from the issuance of redeemable non-controlling interest related to OIC's investment in Asset Vault, $6.8 million in proceeds from the issuance of common stock under the Hudson Equity Purchase Agreement, and $2.6 million in proceeds from insurance premium financing arrangements, partially offset by $56.5 million of debt repayments, $9.6 million of debt issuance cost payments, $2.6 million in payments for transaction costs related to OIC's investment in Asset Vault, and $2.9 million of insurance premium financing repayments.
The increase in net cash provided by financing activities for the year ended December 31, 2025 compared to the year ended December 31, 2024 was driven by the debt financings, OIC's investment in Asset Vault, and issuances of common stock, none of which occurred in 2024.
Non-GAAP Financial Measures
To complement our consolidated statements of operations and comprehensive loss, we use non-GAAP financial measures of adjusted S&M expenses, adjusted R&D expenses, adjusted G&A expenses, adjusted operating expenses, adjusted net loss, and adjusted EBITDA. Management believes that these non-GAAP financial measures complement our GAAP amounts and such measures are useful to securities analysts and investors to evaluate our ongoing results of operations when considered alongside our GAAP measures. The presentation of these non-GAAP measures is not meant to be considered in isolation or as an alternative to other measures of financial performance calculated in accordance with GAAP. These non-GAAP measures and their reconciliation to GAAP financial measures are shown below.
The following table provides a reconciliation from GAAP S&M expenses to non-GAAP adjusted S&M expenses (amounts in thousands):
|
Year Ended December 31,
|
|||||||||||
| 2025 | 2024 | ||||||||||
| S&M expenses (GAAP) | $ | 13,698 | $ | 15,839 | |||||||
| Non-GAAP adjustments: | |||||||||||
| Stock-based compensation expense | 3,868 | 6,162 | |||||||||
| Reorganization expenses | 32 | 288 | |||||||||
| Adjusted S&M expenses (non-GAAP) | $ | 9,798 | $ | 9,389 | |||||||
The following table provides a reconciliation from GAAP R&D expenses to non-GAAP adjusted R&D expenses (amounts in thousands):
|
Year Ended December 31,
|
|||||||||||
| 2025 | 2024 | ||||||||||
| R&D expenses (GAAP) | $ | 14,635 | $ | 25,999 | |||||||
| Non-GAAP adjustments: | |||||||||||
| Stock-based compensation expense | 5,284 | 8,693 | |||||||||
| Reorganization expenses | 318 | 523 | |||||||||
| Adjusted R&D expenses (non-GAAP) | $ | 9,033 | $ | 16,783 | |||||||
The following table provides a reconciliation from GAAP G&A expenses to non-GAAP adjusted G&A expenses (amounts in thousands):
|
Year Ended December 31,
|
|||||||||||
| 2025 | 2024 | ||||||||||
| G&A expenses (GAAP) | $ | 81,180 | $ | 62,971 | |||||||
| Non-GAAP adjustments: | |||||||||||
| Stock-based compensation expense | 27,561 | 23,854 | |||||||||
| Reorganization expenses | 812 | 748 | |||||||||
| Adjusted G&A expenses (non-GAAP) | $ | 52,807 | $ | 38,369 | |||||||
The following table provides a reconciliation from GAAP operating expenses to non-GAAP operating expenses (amounts in thousands):
|
Year Ended December 31,
|
|||||||||||
| 2025 | 2024 | ||||||||||
| Operating expenses (GAAP) | $ | 122,357 | $ | 136,183 | |||||||
| Non-GAAP adjustments: | |||||||||||
| Depreciation, amortization, and accretion (excluding amounts included in cost of revenue) | 3,435 | 1,058 | |||||||||
| Stock-based compensation expense | 36,713 | 38,709 | |||||||||
| Reorganization expenses | 1,162 | 1,559 | |||||||||
| Provision for credit losses | 9,409 | 29,980 | |||||||||
| Loss on impairment and sale of long-lived assets | - | 336 | |||||||||
| Adjusted operating expenses (non-GAAP) | $ | 71,638 | $ | 64,541 | |||||||
The following table provides a reconciliation from net loss attributable to Energy Vault Holdings, Inc. to non-GAAP adjusted net loss, (amounts in thousands):
|
Year Ended December 31,
|
|||||||||||
| 2025 | 2024 | ||||||||||
| Net loss attributable to Energy Vault Holdings, Inc. (GAAP) | $ | (103,611) | $ | (135,750) | |||||||
| Non-GAAP adjustments: | - | ||||||||||
| Stock-based compensation expense | 36,713 | 38,709 | |||||||||
| Provision for credit losses | 9,409 | 29,980 | |||||||||
| Loss on financial instruments carried at fair value | 8,179 | 1,025 | |||||||||
| Expenses related to equity purchase agreement | 2,072 | - | |||||||||
| Transaction cost expense related to redeemable non-controlling interest | 1,872 | - | |||||||||
| Loss on debt extinguishment | 1,532 | - | |||||||||
| Reorganization expenses | 1,162 | 1,559 | |||||||||
| Foreign exchange losses | 1,124 | 300 | |||||||||
| Gain on sale of R&D equipment | (426) | - | |||||||||
| Gain on contribution to equity method investment | (65) | - | |||||||||
| Net loss attributable to non-controlling interest | (47) | (63) | |||||||||
| Loss on impairment and sale of long-lived assets | - | 336 | |||||||||
| Gain on derecognition of contract liability | - | (1,500) | |||||||||
| Adjusted net loss (non-GAAP) | $ | (42,086) | $ | (65,404) | |||||||
The following table provides a reconciliation from net loss to non-GAAP adjusted EBITDA, with net loss being the most directly comparable GAAP measure (amounts in thousands):
|
Year Ended December 31,
|
|||||||||||
| 2025 | 2024 | ||||||||||
| Net loss attributable to Energy Vault Holdings, Inc. (GAAP) | $ | (103,611) | $ | (135,750) | |||||||
| Non-GAAP adjustments: | |||||||||||
| Interest expense | 8,464 | 123 | |||||||||
| Interest income | (1,100) | (5,537) | |||||||||
| Provision for income taxes | 7,763 | 67 | |||||||||
| Depreciation, amortization, and accretion | 5,727 | 1,058 | |||||||||
| Stock-based compensation expense | 36,713 | 38,709 | |||||||||
| Provision for credit losses | 9,409 | 29,980 | |||||||||
| Loss on financial instruments carried at fair value | 8,179 | 1,025 | |||||||||
| Expenses related to equity purchase agreement | 2,072 | - | |||||||||
| Transaction cost expense related to redeemable non-controlling interest | 1,872 | - | |||||||||
| Loss on debt extinguishment | 1,532 | - | |||||||||
| Reorganization expenses | 1,162 | 1,559 | |||||||||
| Foreign exchange losses | 1,124 | 300 | |||||||||
| Gain on sale of R&D equipment | (426) | - | |||||||||
| Gain on contribution to equity method investment | (65) | - | |||||||||
| Net loss attributable to non-controlling interest | (47) | (63) | |||||||||
| Loss on impairment and sale of long-lived assets | - | 336 | |||||||||
| Impairment of equity securities | - | 11,730 | |||||||||
| Gain on derecognition of contract liability | - | (1,500) | |||||||||
| Adjusted EBITDA (non-GAAP) | $ | (21,232) | $ | (57,963) | |||||||
We present adjusted EBITDA, which is net loss excluding adjustments that are outlined in the quantitative reconciliation provided above, as a supplemental measure of our performance and because we believe this measure is frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in our industry. The items excluded from adjusted EBITDA are excluded in order to better reflect our continuing operations.
Adjusted EBITDA is presented on a consolidated basis. Because our reconciliation starts with net loss attributable to Energy Vault Holdings, Inc., we add back net loss attributable to non-controlling interests to arrive at consolidated Adjusted EBITDA. Non-controlling interest allocations may be significantly impacted by the hypothetical liquidation at book value method to allocate Asset Vault's income (loss) between the Company and the redeemable non-controlling interest.
In evaluating adjusted EBITDA, one should be aware that in the future we may incur expenses similar to the adjustments noted above. Our presentation of adjusted EBITDA should not be construed as an inference that our future results will be unaffected by these types of adjustments. Adjusted EBITDA is not a measurement of our financial performance under GAAP and should not be considered as an alternative to net loss, operating loss, or any other performance measures derived in accordance with GAAP or as an alternative to cash flow from operating activities as a measure of our liquidity.
Our adjusted EBITDA measure has limitations as an analytical tool, and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:
•it does not reflect our cash expenditures, future requirements for capital expenditures, or contractual commitments;
•it does not reflect changes in, or cash requirements for, our working capital needs;
•it does not reflect stock-based compensation, which is an ongoing expense;
•although depreciation, amortization, and accretion are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and our adjusted EBITDA measure does not reflect any cash requirements for such replacements;
•it is not adjusted for all non-cash income or expense items that are reflected in our consolidated statements of cash flows;
•it does not reflect the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations;
•it does not reflect limitations on or costs related to transferring earnings from our subsidiaries to us; and
•other companies in our industry may calculate this measure differently than we do, limiting its usefulness as a comparative measure.
Because of these limitations, adjusted EBITDA should not be considered as a measure of discretionary cash available to us to invest in the growth of our business or as a measure of cash that will be available to use to meet our obligations. You should compensate for these limitations by relying primarily on our GAAP results and using adjusted EBITDA only supplementally.
Critical Accounting Estimates
The preparation of these financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.
For a summary of significant accounting policies, refer to Note 2, Summary of Significant Accounting Policiesof the consolidated financial statements included in this Annual Report on Form 10-K.
Revenue
The Company recognizes revenue over time for EPC contracts and technical services in EEQ contracts as a result of the continuous transfer of control of the products and services to the customer. The Company utilizes the percentage of completion method when recognizing revenue over time and percentage of completion is based on costs incurred as a percentage of total estimated contract costs. Since revenue recognition for these performance obligations depends on estimates, which are assessed continually during the term of the contract, recognized revenues and profits are subject to revisions as the performance obligations progresses to completion. The cumulative effects of revisions of estimated total contract costs and revenues, together with any contract reserves which may be deemed appropriate, are recorded in the period in which the facts and changes in circumstances become known. Due to uncertainties inherent in the estimation process, it is reasonably possible that these estimates will be revised in a different period.
The Company's contracts generally provide customers with a right to liquidated damages ("LDs") against Energy Vault in the event specified milestones are not met on time, or certain performance metrics are not met upon or after the substantial completion date. LDs are accounted for as variable consideration, and the contract price is reduced by the expected penalty or LD amount when recognizing revenue. Variable consideration is included in the transaction price only to the extent that it is improbable that a significant reversal in the amount of cumulative revenue recognized will occur when the uncertainty is resolved. Estimating variable consideration requires certain estimates and assumptions, including whether and by how much a project will be delayed and how a project will perform during the performance guarantee period. The existence and measurement of liquidated damages may also be impacted by the Company's judgment about the probability of favorable outcomes of customer disputes involving whether certain events qualify as force majeure or the reason for the events that caused project delays. Variable consideration for LDs is estimated using the expected value of the consideration to be received.
Allowance for Credit Losses
The Company encounters credit loss risks associated with the collection of accounts receivable, contract assets, customer financing receivable, and convertible note receivable. The accounting estimates related to the Company's allowance for credit losses is a critical accounting estimate because the underlying assumptions used for the allowance can change from time to time and credit losses could potentially have a material impact on our results of operations.
Warranty Liabilities
The accounting for warranty liabilities requires us to make assumptions and judgments, and to the extent actual results differ from original estimates, adjustments to recorded liabilities may be required. The key inputs and assumptions used in calculating estimated warranty liabilities are reviewed by management each reporting period. The Company may make additional adjustments to the estimated warranty liability based on a comparison of actual warranty results to expected results for significant differences or based on performance trends or other qualitative factors. If actual failure rates or replacement costs differ from our estimates in future periods, changes to these estimates may be required, resulting in increases or decreases in the estimated warranty liability, which may be material.
Convertible Debentures
The Company's estimate of the fair value of its Convertible Debentures requires significant judgment and the use of valuation techniques that incorporate assumptions regarding the instrument's expected economic outcomes. In estimating fair value, the Company used a Monte Carlo simulation model that considered the note's contractual conversion, redemption, and settlement provisions. The most significant assumptions involved the selection of market-yield assumptions reflective of the instrument's credit profile, expected volatility, and the probability and timing of potential settlement outcomes, including conversion, redemption, or hold-to-maturity scenarios. Changes in these assumptions could materially affect the estimated fair value of the note and the related amounts recognized in the consolidated financial statements.
Stock-Based Compensation
Stock-based compensation for RSUs that vest based on market conditions is estimated on the date of the grant using a Monte Carlo simulation model. The Monte Carlo simulation model requires the input of highly subjective assumptions, including the expected term of the award, the expected volatility of the Company's common stock, risk-free interest rates, and the expected dividend yield of the Company.
Emerging Growth Company Accounting Election
We are an "emerging growth company" as defined in Section 2(a) of the Securities Act of 1933, as amended, and have irrevocably elected to take advantage of the benefits of this extended transition period for new or revised financial accounting standards. We are expected to remain an emerging growth company through the end of 2026 and expect to continue to take advantage of the benefits of the extended transition period. This may make it difficult or impossible to compare our financial results with the financial results of another public company that is either not an emerging growth company or is an emerging growth company that has chosen not to take advantage of the extended transition period exemptions for emerging growth companies because of the potential differences in accounting standards used.
Recently Adopted and Issued Accounting Pronouncements
Recently issued and adopted/unadopted accounting pronouncements are described in Note 2 of the consolidated financial statements included elsewhere in this Annual Report.
Energy Vault Holdings Inc. published this content on March 18, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on March 18, 2026 at 20:19 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]