Results
Nauticus Robotics, Inc.
08/11/2025 | Press release | Distributed by Public on 08/11/2025 15:06
Quarterly Report for Quarter Ending June 30, 2025 (Form 10-Q)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the unaudited condensed consolidated financial statements and the notes thereto included in Part I, Item 1, "Financial Statements" of this Quarterly Report on Form 10-Q.
Overview
Nauticus Robotics, Inc. (the "Company," "our," "us" or "we") is a developer of ocean robots, cloud software and intelligent services that transform operations in offshore energy, environmental monitoring, and defense. Our principal corporate offices are located in Webster, Texas. Our portfolio includes fully autonomous underwater vehicles ("AUVs"), remotely operated vehicles ("ROVs") electric robotic manipulators, and the Nauticus ToolKITT™ software platform. Our technology solutions position us at the forefront of the global shift toward autonomy.
Our flagship autonomous vehicle, AQUANAUT®, provides advantages over conventionally tethered ROVs and traditional AUVs. Leveraging advanced thruster configurations, a streamlined hull, and integrated electric manipulation, AQUANAUT® performs complex subsea tasks with efficiency, precision, and minimal surface support. Nauticus ToolKITT™-our intelligent control and autonomy software-extends this capability across platforms, enabling robots to sense, decide, and act autonomously. Nauticus ToolKITT™ has already been deployed on third-party ROVs and is gaining traction as a transformative solution for inspection, maintenance, and intervention services. The Olympic Arm™ is a fully electric subsea manipulator designed for complex intervention tasks on both work-class ROVs and AQUANAUT® . Its patented electric actuators replace traditional hydraulic systems.
The strategic acquisition of SeaTrepid. finalized on March 20, 2025, intends to expand our operational fleet, enhance service capacity, and open cross-selling opportunities by integrating Nauticus ToolKITT™ into SeaTrepid's operations. The combined portfolio sets a new standard for efficiency, performance, and flexibility in subsea services.
Recent Developments
We entered 2025 with significant momentum, strengthened by both strategic execution and market adoption:
•Operational Deployments - We successfully launched the 2025 offshore season with multiple ROV deployments, including a long-term drill support contract in the Gulf of Mexico and environmental operations off the U.S. East Coast. AQUANAUT® is now integrated into commercial operations, marking a critical milestone in its path to scaled revenue.
•Industry Recognition- Our technology received significant visibility at leading industry conferences. AQUANAUT® was featured in a technical paper presented by a supermajor at the Offshore Technology Conference, while our leadership team contributed to panels at both the DeepStar Technology Symposium and the Louisiana Energy Conference. These appearances highlight our growing influence as a thought leader in subsea autonomy.
•Integration Progress- SeaTrepid integration is delivering tangible results. The combined ROV and AQUANAUT® fleet is enabling us to engage a broader customer base, increase utilization, and expand into new geographies.
•Strategic Partnerships- We announced a collaboration with Open Ocean Robotics to pair AQUANAUT® with solar-powered uncrewed surface vessels, combining persistent surface monitoring with subsea autonomy to unlock cost-efficient, lower-carbon solutions. Additionally, we signed a multi-year master services agreement with Advanced Ocean Systems (AOS) to test integrated subsea and surface autonomy solutions, further expanding our innovation ecosystem.
Market Environment and Outlook
The offshore energy market remains robust, with vessel and subsea asset utilization in the Gulf of Mexico near multi-year highs. While the North American offshore wind sector experienced temporary delays due to policy shifts, recent easing of restrictions has revived select opportunities, and we are actively mobilizing for new wind-farm projects.
Adoption of autonomous subsea robotics is accelerating, driven by customer priorities around safety, efficiency, and data quality. Energy operators are increasingly leading this innovation push, creating tailwinds for advanced solutions like AQUANAUT® and Nauticus ToolKITT™.
Defense sector engagement is also gaining momentum, with increased activity at the prime contractor level. While awards typically flow first to larger primes, we are strategically positioned through partnerships, such as our alliance with Leidos, to participate in future contracts.
Overall, our near-term pipeline is stronger than ever, supported by active contracts, prospective projects in multiple basins, and international interest in our autonomous services.
Operational Performance and Product Advancement
Service revenue in the quarter was driven primarily by SeaTrepid's ROV operations, now fully integrated into Nauticus. Importantly, cross-selling is beginning to take hold, as SeaTrepid's customers express interest in AQUANAUT®, the Olympic Arm™, and Nauticus ToolKITT™.
AQUANAUT® is now mobilized with one of our ROVs on an active commercial environmental contract. While we addressed certain hardware refinements this quarter to improve reliability and uptime, these improvements are expected to yield stronger margins and consistent performance going forward.
Nauticus ToolKITT™ is approaching full commercial deployment. The first commercial release is ready for external testing, and we are advancing discussions with customers to integrate ToolKITT™ onto their own ROV fleets.
Finally, the Olympic Arm™ program continued to mature. Market demand for a compact, fully electric manipulator remains strong, and we intend to capitalize on that demand as development proceeds.
Conclusion
The first half of 2025 has been a period of decisive execution. We have integrated SeaTrepid, expanded our operational fleet, advanced AQUANAUT®, Nauticus ToolKITT™, and Olympic Arm™ toward full commercialization, and forged strategic alliances that extend our market reach.
With a strong ROV services pipeline, growing adoption of autonomous solutions, and AQUANAUT® revenue set to scale in the second half of the year, Nauticus is well positioned for growth. We remain focused on reliability, readiness, and disciplined capital deployment, confident that our strategy will unlock significant long-term value for our stakeholders.
Results of Operations
Three and six months ended June 30, 2025, compared to three and six months ended June 30, 2024
The following table sets forth summarized condensed consolidated financial information:
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| Revenue | |||||||||||||||||||||||||||||||||||||||||||||||
| Service | $ | 2,075,566 | $ | 501,708 | $ | 1,573,858 | 314 | % | $ | 2,240,822 | $ | 966,062 | $ | 1,274,760 | 132 | % | |||||||||||||||||||||||||||||||
| Total revenue | 2,075,566 | 501,708 | 1,573,858 | 314 | % | 2,240,822 | 966,062 | 1,274,760 | 132 | % | |||||||||||||||||||||||||||||||||||||
| Costs and Expenses | |||||||||||||||||||||||||||||||||||||||||||||||
| Cost of revenue | 3,504,043 | 2,875,394 | 628,649 | 22 | % | 4,743,000 | 4,969,349 | (226,349) | -5 | % | |||||||||||||||||||||||||||||||||||||
| Depreciation | 574,563 | 411,586 | 162,977 | 40 | % | 1,054,939 | 837,771 | 217,168 | 26 | % | |||||||||||||||||||||||||||||||||||||
| Research and development | - | - | - | 0 | % | - | 63,534 | (63,534) | -100 | % | |||||||||||||||||||||||||||||||||||||
| General and administrative | 4,368,187 | 3,227,288 | 1,140,899 | 35 | % | 8,677,873 | 6,657,298 | 2,020,575 | 30 | % | |||||||||||||||||||||||||||||||||||||
| Total costs and expenses | 8,446,793 | 6,514,268 | 1,932,525 | 30 | % | 14,475,812 | 12,527,952 | 1,947,860 | 16 | % | |||||||||||||||||||||||||||||||||||||
| Operating loss | (6,371,227) | (6,012,560) | 358,667 | 6 | % | (12,234,990) | (11,561,890) | 673,100 | 6 | % | |||||||||||||||||||||||||||||||||||||
| Other (income) expense: | |||||||||||||||||||||||||||||||||||||||||||||||
| Other (income) expense, net | 52,461 | 118,274 | (65,813) | 56 | % | (34,936) | 21,801 | (56,737) | -260 | % | |||||||||||||||||||||||||||||||||||||
| Gain on lease termination | - | (8,532) | 8,532 | 100 | % | - | (23,897) | 23,897 | -100 | % | |||||||||||||||||||||||||||||||||||||
| Foreign currency transaction loss | 274 | 4,296 | (4,022) | -94 | % | 3,541 | 9,443 | (5,902) | -63 | % | |||||||||||||||||||||||||||||||||||||
| Loss on extinguishment of debt | - | - | - | 0 | % | - | 78,734,949 | (78,734,949) | 100 | % | |||||||||||||||||||||||||||||||||||||
| Change in fair value of warrant liabilities | 8,757 | (4,422,701) | 4,431,458 | 100 | % | (42,131) | (12,732,324) | 12,690,193 | 100 | % | |||||||||||||||||||||||||||||||||||||
| Change in fair value of New Convertible Debentures | - | (7,410,303) | 7,410,303 | 100 | % | - | (11,914,729) | 11,914,729 | 100 | % | |||||||||||||||||||||||||||||||||||||
| Change in fair value of November 2024 Debentures | (187,866) | - | (187,866) | -100 | % | 536,060 | - | 536,060 | -100 | % | |||||||||||||||||||||||||||||||||||||
| Interest expense, net | 1,209,323 | 1,165,431 | 43,892 | 4 | % | 2,323,839 | 2,640,828 | (316,989) | -12 | % | |||||||||||||||||||||||||||||||||||||
| Net income (loss) | $ | (7,454,176) | $ | 4,540,975 | $ | 11,995,151 | -264 | % | $ | (15,021,363) | $ | (68,297,961) | $ | (53,276,598) | -78 | % | |||||||||||||||||||||||||||||||
Revenue.For the three and six months ended June 30, 2025, revenue increased $1,573,858 or 314% and $1,274,760 or 132%, respectively, as compared to the three and six months ended June 30, 2024, primarily driven bythe additional activity from the SeaTrepid acquisition performed in March 20, 2025.
Cost of revenue. For the three ended June 30, 2025, cost of revenueincreased $628,649 or 22% as compared to the three months ended June 30, 2024due to the additional revenue. For the six months ended June 30 2025, cost of revenue decreased$226,349 or 5%, as compared to the six months ended June 30, 2024 driven by cost control strategies.
Depreciation.For the three and six months ended June 30, 2025, depreciation increased $162,977 or 40% and $217,168, or 26%, respectively, as compared to the three and six months ended June 30, 2024, due to the increase in property and equipment primarily related to the acquisition of SeaTrepid.
Research and development.For the six months ended June 30, 2025, research and development costs decreased $63,534, or 100%, respectively, compared to the six months ended June 30, 2024, due to the Company achieving technological feasibility in both hardware and software development and focusing on bringing its products to market. From April 1, 2024, no costs were classified as research and development.
General and administrative.For the three and six months ended June 30, 2025, general and administrative costs increased 1,140,899 or 35% and $2,020,575, or 30%, respectively, compared to the three and six months ended June 30, 2024,driven by the SeaTrepid acquisition related costs as well as integration of their structure.
Other (income) expense, net.For the three months ended June 30, 2025, other expense is attributable to franchise tax liabilities incurred in relation to activity in Brazil. For the six months ended June 30, 2025, other expense related to prior year reimbursement of costs from client. For the three monthsended June 30, 2024, other expense related primarily to franchise tax expense and taxes incurred from activity in Brazil. For the six months ended June 30, 2024, other expense related to franchise tax expense and taxes incurred from activity in Brazil partially offset by proceeds received from the sale of expensed equipment.
Gain on lease termination.For the three months ended June 30, 2024, a gain on lease termination of $8,532 was reported, relating to a second agreement to reduce leased office space in Norway. For the six months ended June 30, 2024, a gain on lease termination of $23,897 was reported, primarily due to the reduction in leased office space in Norway.
Loss on extinguishment of debt.For the six months ended June 30, 2024, a loss on the extinguishment of debt of $78,734,949 was reported driven by the Amendment and Exchange Agreement. See Note 7 "Notes Payable".
Change in fair value of warrant liabilities.For the three months ended June 30, 2025 the Company reported a loss in the fair value of warrant liabilities of $8,757; for the three months ended June 30 2024, the Company reported a gain in fair value of warrant liabilities $4,422,701. For the six months ended June 30, 2025 and 2024, the Company reported a gain in the fair value of warrant liabilities of $42,131 and $12,732,324, respectively.
Change in fair value of New Convertible Debentures.For the three and six months ended June 30, 2024, a gain on the fair value of the new convertible debentures of $7,410,303 and $11,914,729 was reported respectively.
Change in fair value of November 2024 Debentures. For the three months ended June 30, 2025 a gain on the fair value of the new convertible debentures of ($187,866); for the six months ended June 30, 2025 a loss on the fair value of the new convertible debentures of $536,060 was reported.
Interest expense, net.For the three months ended June 30, 2025, interest expense, net increased $43,892, or 4%, driven by interest on the convertible senior secured term loans. For the six months ended June 30, 2025, interest expense, net decreased, $316,989 or 12% driven by interest on the convertible senior secured term loans.
Liquidity and Capital Resources
The Company continues to develop its principal products and conduct research and development activities. Currently, the Company does not generate sufficient revenue to cover operating expenses, working capital and capital expenditures. The Company has embarked on cost-cutting measures to continue to preserve cash. The Company may require additional liquidity to continue its operations over the next twelve months which a current investor has committed to provide. The Company believes with this investor support that there will be sufficient resources to continue as a going concern for at least one year from the date that the condensed consolidated financial statements contained in this Form 10-Q are issued.
As of June 30, 2025, the Company had $2,663,404 of cash and cash equivalents.
Significant sources and uses of cash during the six months ended June 30, 2025.
Sources of cash:
•The Company received net proceeds of $19,403,540 from equity financing attributable to the ATM share offering.
Uses of cash:
•Cash used in operating activities was $14,006,452, of which $2,067,289 was used to increase working capital.
•Cash used in investing activities related to the acquisition of SeaTrepid of $3,871,992 and capital expenditures of $47,239.
Indebtedness. The Company's indebtedness as of June 30, 2025, is presented in Item 1, "Financial Statements - Note 7 - Notes Payable" and our lease obligations are presented in Item 1, "Financial Statements - Note 8 - Leases."
Critical Accounting Policies and Estimates
Certain of our accounting estimates are important to the portrayal of our financial condition, since they require management to make difficult, complex or subjective judgements, some of which may relate to matters that are inherently certain. Estimates are susceptible to material changes as a result of changes in facts and circumstances. Please refer to "Critical Accounting Policies and Estimates" contained in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024 for a complete discussion of our critical accounting estimates.
Nauticus Robotics, Inc. published this content on August 11, 2025, and is solely responsible for the information contained herein. Distributed via SEC EDGAR on August 11, 2025 at 21:06 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]