Earnings Call Insights: FuelCell Energy (FCEL) Q3 2025
Management View
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Jason Few, President, CEO & Director, stated that the company is executing its third fiscal quarter with “meaningful revenue growth while focusing on expanding our sales pipeline and improving our cost structure.” He emphasized that restructuring actions implemented in June are lowering costs and sharpening focus on distributed power generation. Few explained, “broader deployment of this platform is our clearest path to profitability, supported domestically by favorable public policy tailwinds.” He highlighted the company’s position in electrochemical technology and the opportunity to address global power demand driven by AI and data centers.
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Few discussed strategic partnerships, particularly in South Korea, where FuelCell Energy delivered 8 replacement modules to Gyeonggi Green Energy Company Limited (GGE) and entered a long-term service agreement with CGN Yulchon Generation Company for 8 carbonate fuel cell modules totaling 10 megawatts. The company also signed an MOU with Inuverse to explore up to 100 megawatts of fuel cell-based power for the AI Daegu Data Center.
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The CEO noted, “We remain on track to reduce operating expenses by 30% on an annualized basis compared to operating expenses incurred in fiscal year 2024 and we are targeting the future achievement of positive adjusted EBITDA once our Torrington manufacturing facility reaches an annualized production rate of 100 megawatts per year.”
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Michael Bishop, Executive VP, CFO & Treasurer, stated, “In the third quarter of fiscal year 2025, we reported total revenues of $46.7 million compared to revenues of $23.7 million in the prior year quarter, representing a 97% increase.” Bishop also noted, “Adjusted net loss per share attributable to common stockholders, which excludes the noncash impairment expenses, restructuring expenses and certain other noncash items was $0.95 compared to $1.74 in the third quarter of fiscal year 2024.”
Outlook
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Management reiterated a target to reduce operating expenses by 30% on an annualized basis compared to fiscal year 2024, and the focus remains on achieving positive adjusted EBITDA at a 100 megawatt annualized production rate at the Torrington facility. Bishop stated the facility is currently operating in the “30 to 40-megawatt range” and will adjust as backlog materializes.
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Few indicated strong demand in the U.S. and Korea for data center applications, supported by policy tailwinds such as ITC eligibility for fuel cell technologies, which is expected to last through at least 2032 and potentially as far as 2035.
Financial Results
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Total revenues for the third quarter of fiscal year 2025 were $46.7 million. Product revenues reached $26 million, service agreement revenues were $3.1 million, generation revenues were $12.4 million, and advanced technology contract revenues were $5.3 million.
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Gross loss for the quarter was $5.1 million. Operating expenses totaled $90.2 million, with noncash impairment expenses of $64.5 million and restructuring expenses of $4.1 million.
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Net loss attributable to common stockholders in the quarter was $92.5 million, with a resulting net loss per share of $3.78. Adjusted net loss per share was $0.95.
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Cash, restricted cash, and cash equivalents as of July 31, 2025, totaled $236.9 million.
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Backlog increased by approximately 4% to $1.24 billion.
Q&A
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Matt (Canaccord Genuity) asked about momentum in the data center space and the Inuverse partnership. Few responded, “the Inuverse announcement is a reflection of the strength that we’ve been able to demonstrate in Korea with large-scale utility platforms” and emphasized strong U.S. domestic demand in addition to Korea.
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Jeffrey Osborne (TD Cowen) inquired about the pipeline for legacy commercial business post-ITC reinstatement. Few said, “we’re starting to see a shift in the way utilities think about deploying power and really gaining an appreciation for the value of distributed power generation as opposed to just centralized generation.”
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Osborne asked about module delivery cadence for GGE and CGN. Bishop explained, “we had 16 modules left for this fiscal year. So we delivered on time, 8 modules this quarter. That would leave a balance of another 8 in the fourth fiscal quarter and then another 16 next fiscal year.”
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Osborne questioned Torrington’s facility run rate and EBITDA outlook. Bishop stated, “the facility is in between the 30 to 40-megawatt range… when the company gets to 100 megawatts of production volume, we expect to be at adjusted EBITDA positive.”
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Ryan Pfingst (B. Riley) asked about the timeline for the Inuverse MOU converting to an order. Few said, “those activities are ongoing, and they are working aggressively to secure those offtake agreements now having lined up the power and gas supply for that site.”
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Pfingst also asked about milestones for the Exxon/Rotterdam carbon capture project. Few explained, “we are in the conditioning phase for the carbon capture modules that will be shipped to Rotterdam… we expect the project to be up and operational in 2026.”
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Noel Parks (Tuohy Brothers) discussed strategic financing and data center urgency. Bishop described project-specific and broader commercial financing models, while Few detailed the value proposition for data centers, including modularity, absorption chilling, and the ability to scale.
Sentiment Analysis
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Analysts expressed strong interest in data center opportunities and financing structure, displaying a slightly positive to neutral tone while probing for specifics on backlog, production cadence, and partnership momentum.
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Management maintained a confident and disciplined tone in prepared remarks and Q&A, with Few emphasizing “the momentum for data centers and the market opportunity it represents.” Bishop used confident language regarding cost control and EBITDA targets.
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Compared to the previous quarter, management’s tone continues to be focused and confident, while analysts remain constructively inquisitive but less focused on restructuring-related concerns.
Quarter-over-Quarter Comparison
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The current quarter featured a continued focus on cost reduction, with a reiterated target of 30% annualized operating expense reduction. There is a marked increase in emphasis on commercial momentum in Korea and data center partnerships, including the Inuverse MOU.
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Backlog increased slightly, with significant product and service agreement updates in Korea. Compared to the previous quarter, revenue growth was stronger, and management highlighted tangible impacts from restructuring.
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Analysts shifted from restructuring-related questions to a heavier focus on market traction, delivery cadence, and commercial financing.
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Management’s confidence in achieving EBITDA profitability at 100 megawatts production was reiterated, with added details on current production rates and commercial pipeline.
Risks and Concerns
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Noncash impairment and restructuring expenses impacted operating results.
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Management noted that the path to positive EBITDA depends on scaling production to 100 megawatts, which is contingent on backlog growth.
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Analysts inquired about the timing of order conversions, project financing, and the competitive environment, indicating ongoing uncertainty about the pace of commercial adoption and order flow.
Final Takeaway
FuelCell Energy’s leadership underscored that decisive restructuring and a sharpened strategic focus on distributed power generation are yielding measurable results, with revenue growth, expanded partnerships, and cost discipline positioning the company to capitalize on global demand trends in data centers and clean energy. Management believes that continued progress on operational efficiency and scaling manufacturing will be critical to achieving profitability and long-term value creation.