FCEL

MKT CAP $956.3MP/E —DIV YIELD —FCF YIELD -10.57%REV TTM $154.1M +1.1%NET INCOME −$175.1MNET CASH $570.2M52W 6.00 – 36.01SEC XBRL · TTM TO Invalid Date

How FCEL rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

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Overview FuelCell Energy is a clean energy technology company and a stationary fuel cell manufacturer with 22 years of operating experience in this field.
Founded in 1969 and headquartered in Danbury, Connecticut, we manufacture and sell our proprietary molten carbonate fuel cell systems, which deliver large-scale, continuous clean power and advanced emissions management.
Unlike traditional power generation methods that rely on combustion, our fuel cells generate electricity electrochemically through a chemical reaction rather than burning fuel, resulting in ultra-low emissions and high efficiency.
Our carbonate fuel cell systems are fuel-flexible, with the ability to run on biofuels, renewable natural gas, or hydrogen-hydrocarbon blends, and provide reliable baseload power, carbon capture, and thermal energy for chilling, heating, and process steam.
As global energy demand rises driven by artificial intelligence (“AI”), electrification, and the need for enhanced grid resiliency, we believe solutions like ours will be vital in addressing next-generation needs, helping to strengthen the grid, reducing pollution, and supporting decarbonization goals.
We have proven utility-scale projects operating at 10 MW, 20 MW, and 58.8 MW, each with more than seven years of continuous run time.
As a company, we are motivated by our purpose of enabling a world empowered by clean energy.
We target a range of markets and applications with our products, including utilities and independent power producers, data centers, wastewater treatment, commercial and hospitality, and microgrids, among others.
We market our products primarily in the U.S. and Canada, the European Union (the “EU”) and the United Kingdom (the “UK”), and priority Asian markets including South Korea, Singapore, Malaysia, and Thailand.
We selectively pursue additional opportunities in other regions that align with our strategic priorities.
We focus our expansion on markets and regions that value clean distributed generation, have poor grid reliability and/or challenged transmission and distribution lines, and can benefit from the value streams our products provide.
In addition to our existing core molten carbonate-based commercial products, we engage strategically in research and development, both company-funded and carried out under grants from and commercial agreements with private companies and various government agencies through our Advanced Technologies programs.
Our Advanced Technologies programs are currently focused on continued development and advancement of our core carbonate fuel cell technology as well as commercialization of our solid oxide electrolysis technology for distributed hydrogen.
We focus on generating revenue from our core recurring and non-recurring revenue sources, while working to identify the next trends in clean energy we believe we can commercialize, take to market, and grow into future revenue streams.
Recent Developments The events described in this “Recent Developments” section relate, in part, to matters discussed in more detail below in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section and/or in the Notes to the Consolidated Financial Statements. 2025 EXIM Financing On November 26, 2025, the Company closed on its second project debt financing transaction (the “2025 EXIM Financing”) with the Export-Import Bank of the United States (“EXIM”) to support the Company’s obligations under its long-term service agreement (“LTSA”) with Gyeonggi Green Energy Co., Ltd.
(“GGE”), pursuant to which the Company is supplying GGE with upgraded carbonate fuel cell modules to replace existing units at GGE’s Hwaseong Baran Industrial Complex.
In conjunction with this financing, the Company entered into a promissory note and related security agreements securing the loan with equipment liens, resulting in gross proceeds of approximately $ 25.0 million.
Interest accrues at a fixed interest rate of 5.29 % , and the note is repayable in monthly installments consisting of interest and principal over 7 years from the date of the first debt payment, which is due in December 2025.
After payment of customary fees and transaction costs, net proceeds to the Company were approximately $23.1 million. The credit agreement between the Company and EXIM with respect to the 2025 EXIM Financing contains certain reporting requirements and other affirmative and negative covenants which are customary for transactions of this type.
In addition, under this credit agreement and through an amendment to the credit agreement for the 2024 EXIM Financing (as defined elsewhere herein), the Company is required to maintain, throughout the remaining term of the credit agreement for the 2024 EXIM Financing and the term of the credit agreement for the 2025 EXIM Financing, a total minimum cash balance of $ 55.0 million.
The amendment to the credit agreement for the 2024 EXIM Financing, which was executed in conjunction with and at the same time as the credit agreement for the 2025 EXIM Financing, reduced the total minimum cash balance requirement from $ 100.0 million to $ 55.0 million.
For the purposes of these credit agreements, cash is defined as the sum of unrestricted cash plus all short-term (but no longer than three months), marketable United States Treasury instruments (as measured based on the maturity amount of each instrument).
Results of Operations Management evaluates our results of operations and cash flows using a variety of key performance indicators, including revenues compared to prior periods and internal forecasts, costs of our products and results of our cost reduction initiatives, and operating cash use.
GAAP. The following discussion and analysis of our Results of Operations and Liquidity and Capital Resources includes a comparison of the fiscal year ended October 31, 2025 (“fiscal year 2025”) to the fiscal year ended October 31, 2024 (“fiscal year 2024”).
A similar discussion and analysis that compares fiscal year 2024 to the fiscal year ended October 31, 2023 (“fiscal year 2023”) can be found in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our Form 10-K for the fiscal year ended October 31, 2024. Comparison of the Years Ended October 31, 2025 and 2024 Revenues and Costs of revenues Revenues and costs of revenues for the years ended October 31, 2025 and 2024 were as follows: Year Ended October 31, Change (dollars in thousands) 2025 2024 $ % Total revenues $ 158,162 $ 112,132 $ 46,030 41% Total costs of revenues 184,570 148,050 36,520 25% Gross loss $ (26,408) $ (35,918) $ 9,510 26% Gross margin (16.7)% (32.0)% Total revenues for the year ended October 31, 2025 increased $46.0 million, or 41%, to $158.2 million from $112.1 million for the year ended October 31, 2024.
Total costs of revenues for the year ended October 31, 2025 increased by $36.5 million, or 25%, to $184.6 million from $148.1 million for the year ended October 31, 2024.
The Company’s gross margin was (16.7)% in fiscal year 2025, as compared to a gross margin of (32.0)% in fiscal year 2024.
Product revenues Product revenues, cost of product revenues and gross loss from product revenues for the years ended October 31, 2025 and 2024 were as follows: Year Ended October 31, Change (dollars in thousands) 2025 2024 $ % Product revenues $ 69,129 $ 25,675 $ 43,454 169% Cost of product revenues 82,853 39,582 43,271 109% Gross loss from product revenues $ (13,724) $ (13,907) $ (1)% Product revenues gross margin (19.9)% (54.2)% Product revenues for the year ended October 31, 2025 were $69.1 million compared to $25.7 million for the year ended October 31, 2024.
The increase in product revenues during the year ended October 31, 2025 was primarily driven by $66.0 million of revenue recognized under the Company’s LTSA with GGE for the replacement of 22 fuel cell modules for GGE’s 58.8 MW fuel cell power plant platform in Hwasong-si, South Korea, compared to the revenue recognized for the replacement of 6 fuel cell modules in the year ended October 31, 2024.
Partially offsetting the increase in revenue recognized under the LTSA with GGE is the decrease in revenue recognized under the Company’s sales contract with Ameresco, Inc. $3.1 million of revenue was recognized under the Company’s sales contract with Ameresco, Inc. for the year ended October 31, 2025, compared to $7.7 million in the year ended October 31, 2024.
The Company’s sales contract with Ameresco, Inc. was entered into during the second quarter of fiscal year 2024, pursuant to which the Company is to provide a 2.8 MW platform to the Sacramento Sewer District. Cost of product revenues increased $43.3 million for the year ended October 31, 2025 to $82.9 million, compared to $39.6 million in the year ended October 31, 2024, primarily due to the higher product sales in fiscal year 2025.
Manufacturing variances, primarily related to production volumes and unabsorbed overhead costs, totaled approximately $13.1 million for the year ended October 31, 2025 compared to approximately $11.9 million for the year ended October 31, 2024. Product revenues for the year ended October 31, 2025 generated a gross loss of $(13.7) million compared to a gross loss of $(13.9) million for the year ended October 31, 2024.
The gross loss for both of the years ended October 31, 2025 and 2024 was primarily due to the manufacturing variances discussed above.
For the year ended October 31, 2025, we operated at an annualized production rate of approximately 31.5 MW, which is an increase from the annualized production rate of 27.7 MW for the year ended October 31, 2024.
The increase in the annualized production rate for fiscal year 2025 is primarily due to increasing our production levels in our Torrington facility as a result of market demand timing.
As of October 31, 2025 and 2024, there was $66.2 million and $111.3 million, respectively, of product backlog.
Service agreements revenues Service agreements revenues and associated cost of revenues for the years ended October 31, 2025 and 2024 were as follows: Year Ended October 31, Change (dollars in thousands) 2025 2024 $ % Service agreements revenues $ 20,398 $ 9,969 $ 10,429 105% Cost of service agreements revenues 22,634 11,098 11,536 104% Gross loss from service agreements revenues $ (2,236) $ (1,129) $ (1,107) 98% Service agreements revenues gross margin (11.0)% (11.3)% Revenues for the year ended October 31, 2025 from service agreements increased $10.4 million to $20.4 million from $10.0 million for the year ended October 31, 2024 primarily because more module exchanges were performed under long-term service agreements during the year ended October 31, 2025 than during the year ended October 31, 2024.
The increase is also a result of revenue recognized under the Company’s LTSA with GGE for service provided by the Company to GGE’s 58.8 MW fuel cell power plant platform in Hwaseong-si, South Korea. For the year ended October 31, 2025, performance penalties under our service agreements totaled approximately $0.8 million compared to approximately $0.4 million for the year ended October 31, 2024.
Performance guarantees represent variable consideration for service contracts and accordingly are recorded as an offset to service agreements revenues. Cost of service agreements revenues increased $11.5 million to $22.6 million for the year ended October 31, 2025 from $11.1 million for the year ended October 31, 2024.
Cost of service agreements revenues were higher for the year ended October 31, 2025 than for the year ended October 31, 2024 primarily due to the costs associated with the greater number of module exchanges performed during the year, as well as the costs of commissioning GGE modules during the year.

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Item 1A Risk Factors” in this Annual Report.
Overview At FuelCell Energy, our purpose is to enable a world powered by clean energy.
We are a global leader in delivering a variety of clean energy solutions to address some of the world’s most critical challenges around energy access, resilience, reliability, affordability, safety and security.
Since our inception, FuelCell Energy has been innovating and developing commercial technologies that produce clean electricity, heat, clean hydrogen, and water.
We are also proud to be at the forefront of what we believe to be one of the most critical technologies required to achieve the world’s overall emissions objectives: carbon capture.
Today, we offer commercial technology that produces clean electricity, heat, clean hydrogen, and water and is also capable of recovering and capturing carbon for utilization and/or sequestration, depending on product configuration and application.
We also continue to invest in product development and commercializing technologies that are expected to add new capabilities to our platforms’ abilities to deliver hydrogen and long duration hydrogen-based energy storage through our solid oxide technologies, as well as further enhance our existing platforms’ carbon capture solutions. We target a range of markets and applications with our products, including utilities and independent power producers, data centers, wastewater treatment, commercial and hospitality, food and beverage, and microgrids, among others.
We market our products primarily in the United States, Europe and Korea, and we are also pursuing opportunities in other countries around the world.
We target for expansion and development markets and geographic regions that benefit from and value clean distributed generation; are located where there are high energy costs, poor grid reliability, and/or challenged transmission and distribution lines; can leverage the multiple value streams delivered by our platforms (electricity, hydrogen, thermal, water, and carbon recovery); are aligned with regulatory frameworks that harmonize energy, economic and environmental policies; and are committed to reducing their Scope 1 and Scope 2 emissions. FuelCell Energy, headquartered in Danbury, Connecticut, was founded in 1969 as a New York corporation to provide applied research and development services on a contract basis.
We completed our initial public offering in 1992 and reincorporated in Delaware in 1999.
We began selling stationary fuel cell power plants commercially in 2003.
Recent Developments The events described in this “Recent Developments” section relate, in part, to matters discussed in more detail below in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section and/or in the Notes to the Consolidated Financial Statements. November 2024 Restructuring On November 13, 2024, the Company’s Board of Directors approved a global restructuring of its operations in the U.S., Canada and Germany.
The restructuring plan is aimed at reducing operating costs and better aligning its workforce with the needs of the Company’s business and its customers.
The restructuring plan included a reduction in our workforce of approximately 13% or 75 employees in November 2024 and includes reduced spending for product development, overhead and other costs.
This followed a 4% or 17 employee reduction in workforce in September 2024.
The restructuring plan also includes the deferment and cancelation of certain previously planned capital and project expenditures.
The restructuring plan will not impact the way the Company supports existing customers, and the Company will continue to deliver on replacement fuel cell modules and service and monitoring contracts.
For more information about the restructuring, please see Part II, Item 8, Note 4 — Restructuring and Note 22 — Subsequent Events. Results of Operations Management evaluates our results of operations and cash flows using a variety of key performance indicators, including revenues compared to prior periods and internal forecasts, costs of our products and results of our cost reduction initiatives, and operating cash use.
GAAP. The following discussion and analysis of our Results of Operations and Liquidity and Capital Resources includes a comparison of the fiscal year ended October 31, 2024 (“fiscal year 2024”) to the fiscal year ended October 31, 2023 (“fiscal year 2023”).
A similar discussion and analysis that compares fiscal year 2023 to the fiscal year ended October 31, 2022 (“fiscal year 2022”) can be found in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our Form 10-K for the fiscal year ended October 31, 2023. Comparison of the Years Ended October 31, 2024 and 2023 Revenues and Costs of revenues Revenues and costs of revenues for the years ended October 31, 2024 and 2023 were as follows: Year Ended October 31, Change (dollars in thousands) 2024 2023 $ % Total revenues $ 112,132 $ 123,394 $ (11,262) (9)% Total costs of revenues 148,050 133,929 14,121 11% Gross loss $ (35,918) $ (10,535) $ (25,383) 241% Gross margin (32.0)% (8.5)% Total revenues for the year ended October 31, 2024 decreased $11.3 million, or 9%, to $112.1 million from $123.4 million for the year ended October 31, 2023.
Total costs of revenues for the year ended October 31, 2024 increased by $14.1 million, or 11%, to $148.1 million from $133.9 million for the year ended October 31, 2023.
The Company’s gross margin was (32.0)% in fiscal year 2024, as compared to a gross margin of (8.5)% in fiscal year 2023.
Product revenues Product revenues, cost of product revenues and gross (loss) profit from product revenues for the years ended October 31, 2024 and 2023 were as follows: Year Ended October 31, Change (dollars in thousands) 2024 2023 $ % Product revenues $ 25,675 $ 19,589 $ 6,086 31% Cost of product revenues 39,582 12,878 26,704 207% Gross (loss) profit from product revenues $ (13,907) $ 6,711 $ (20,618) (307)% Product revenues gross margin (54.2)% 34.3% Product revenues for the year ended October 31, 2024 were $25.7 million compared to $19.6 million for the year ended October 31, 2023.
The increase in product revenues during the year ended October 31, 2024 was primarily driven by $18.0 million of revenue recognized under the Company’s long-term service agreement (“LTSA”) with Gyeonggi Green Energy Co., Ltd.
(“GGE”) for the replacement of 6 fuel cell modules for GGE’s 58.8 MW fuel cell power plant platform in Hwasong-si, Korea.
The increase also reflects $7.7 million of revenue recognized under the Company’s sales contract with Ameresco, Inc., which was entered into during the second quarter of fiscal year 2024, pursuant to which the Company is to provide a 2.8 MW platform to the Sacramento Sewer District. Product revenues for the year ended October 31, 2023 relate to the December 2021 Settlement Agreement (the “Settlement Agreement”) with POSCO Energy Co., Ltd.
(“POSCO Energy”) and its subsidiary, Korea Fuel Cell Co., Ltd.
(“KFC”), which included an option to purchase an additional 14 modules (in addition to the 20 modules that were purchased by KFC during fiscal year 2022).
This option included a material right related to an extended warranty obligation for the modules.
The option was not exercised by KFC as of the expiration date of December 31, 2022 and, as a result, during the year ended October 31, 2023, the Company recognized $9.1 million of product revenues, which represents the consideration allocated to the material right if the option had been exercised.
Product revenues for the fiscal year ended October 31, 2023 also included $10.5 million of revenue that was recognized in October 2023 when certain of the modules previously sold by the Company to KFC were installed by KFC at the power plants operated by Noeul Green Energy Co., Ltd.
(“Noeul Green Energy”), the Company entered into a new long-term service agreement to service these power plants (including the modules installed by KFC), and the existing service agreement between KFC and Noeul Green Energy was simultaneously terminated.
Recognition of this revenue was previously constrained due to an obligation of the Company to KFC related to modules previously sold by the Company to KFC.
This obligation was relieved in conjunction with the execution of the new long-term service agreement with Noeul Green Energy. Cost of product revenues increased $26.7 million for the year ended October 31, 2024 to $39.6 million, compared to $12.9 million in the same period in the prior year, primarily due to the higher product sales in fiscal year 2024.
Manufacturing variances, primarily related to production volumes and unabsorbed overhead costs, totaled approximately $11.9 million for the year ended October 31, 2024 compared to approximately $12.0 million for the year ended October 31, 2023. Product revenues for the year ended October 31, 2024 generated a gross loss of $13.9 million compared to a gross profit of $6.7 million for the year ended October 31, 2023.
The gross loss for the year ended October 31, 2024 was primarily due to the manufacturing variances discussed above.
The gross profit for the year ended October 31, 2023 is a direct result of the product revenues recognized related to the expiration without exercise of KFC’s module purchase option, the release of previously constrained product revenue and the fact that there were no corresponding costs associated with the recognition of these revenues.
For the year ended October 31, 2024, we operated at an annualized production rate of approximately 27.7 MW, which is a decrease from the annualized production rate of 32.7 MW for the year ended October 31, 2023.
The reduction in the annualized production rate for fiscal year 2024 is primarily due to moderating our production levels in our Torrington facility as a result of market demand timing.
As of October 31, 2024 and 2023, there was $111.3 million and $0 million, respectively, of product backlog. Service agreements revenues Service agreements revenues and associated cost of revenues for the years ended October 31, 2024 and 2023 were as follows: Year Ended October 31, Change (dollars in thousands) 2024 2023 $ % Service agreements revenues $ 9,969 $ 49,084 $ (39,115) (80)% Cost of service agreements revenues 11,098 44,953 (33,855) (75)% Gross (loss) profit from service agreements revenues $ (1,129) $ 4,131 $ (5,260) (127)% Service agreements revenues gross margin (11.3)% 8.4% Revenues for the year ended October 31, 2024 from service agreements decreased $39.1 million to $10.0 million from $49.1 million for the year ended October 31, 2023 primarily because fewer module exchanges were performed during the year ended October 31, 2024.

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Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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