Eos Energy Enterprises Q1 Earnings Call Highlights

Key Points

• Eos Energy posted a strong first quarter, with revenue surging 445% year over year to $57 million and backlog reaching $645 million. Management reaffirmed its 2026 revenue outlook of $300 million to $400 million.
• The company unveiled Frontier Power USA, a financing platform meant to improve bankability for long-duration storage projects. Eos said Frontier will combine project development, insurance-backed financing and operations support, and it already signed a 2 GWh capacity reservation agreement tied to the platform.
• Operational performance improved sharply, with cube output up 467% year over year and Thornhill facility production expected to begin in June. Eos also said its DawnOS upgrade is boosting efficiency and that it still expects positive adjusted gross margin later this year and positive adjusted EBITDA before year-end.

Eos Energy Enterprises NASDAQ: EOSE reported a sharp year-over-year increase in first-quarter revenue and outlined a new project financing platform that management said is intended to accelerate adoption of its long-duration energy storage systems.

The company generated $57 million in first-quarter 2026 revenue, up 445% from the prior-year period, according to Nathan Kroeker, chief commercial officer and interim chief financial officer. Chief Executive Officer Joe Mastrangelo said revenue over the past two quarters totaled $115 million, more than the company reported for all of 2025.

Eos ended the quarter with $472 million in cash and $645 million in backlog, representing 2.6 gigawatt-hours of storage, Kroeker said. The company reaffirmed its 2026 revenue outlook of $300 million to $400 million.

Frontier Power USA Positioned as Financing Platform

A major focus of the call was Frontier Power USA, a newly announced platform that Eos said is designed to address what Mastrangelo described as the “single biggest barrier” to long-duration storage adoption: bankability.

Mastrangelo said Frontier combines Eos’s technology stack, including its Z3 battery module, DawnOS controls and Indensity system configuration, with project development, insurance-backed financing and asset operations capabilities. He said the platform is intended to bring together capital, insurance, construction and offtake arrangements that are often assembled sequentially on individual projects.

Frontier is expected to be capitalized with three layers, according to Mastrangelo:

• $100 million in institutional capital from Cerberus;
• A targeted $150 million contribution from Eos, funded through a pro rata rights offering;
• A technology performance insurance wrap from Ariel Green at Lloyd’s of London, supporting senior project debt targeted at more than $1 billion.

Eos also entered into a 2 gigawatt-hour firm capacity reservation agreement with Frontier Power USA. Mastrangelo said the agreement will increase backlog, though not on a one-for-one basis because part of the agreement is expected to involve a project already reflected in backlog that could be financed through Frontier.

During the question-and-answer session, JPMorgan’s Mark Strouse asked how Eos would recognize revenue from Frontier given its minority equity stake. Kroeker said revenue would flow through the income statement as it would with a third-party customer, but would be identified as related-party revenue. Mastrangelo said Frontier would have its own board and management team and that agreements would be negotiated at arm’s length.

Production Improves as Thornhill Facility Nears Initial Output

Chief Operating Officer John Mahaz said the company is beginning to see returns from investments in automation and productivity. Cube output increased 467% from the first quarter of 2025 and 17% from the fourth quarter, while direct labor per cube declined 47% year-over-year and 25% sequentially.

Mahaz said margins improved by approximately $10 million quarter-over-quarter as output increased and material costs came down. He said material cost per cube was up 4% year-over-year due to the transition from the prior battery management system to DawnOS, but down 5% sequentially as supplier and design improvements took hold.

At the company’s Thornhill facility, Mahaz said building readiness is complete, line power-up is underway, and initial production is on track for the end of the second quarter. Full production is expected in the fourth quarter. In response to a question from Stifel’s Patrick Ouellette, Mahaz said the line is installed and undergoing power-up and debugging, with production expected to start in June.

DawnOS Performance Cited as Key to Bankability

Mastrangelo said Eos has crossed 6 gigawatt-hours of discharged energy across its technology, spanning about 3.9 million cycles. He said the Z3 platform accounts for roughly half a gigawatt-hour of energy and more than 1 million cycles.

The CEO highlighted the transition from string-level battery management to module-level battery management under DawnOS. He said the change allows each module to be monitored, managed and dispatched individually, improving the ability to extract energy efficiently from the system.

Using one site as an example, Mastrangelo said average round-trip efficiency before DawnOS ranged from 34% to 42%, with high variability. After the DawnOS upgrade, he said average round-trip efficiency moved into the low-to-mid 70% range, with a maximum performance of 88% and reduced variance.

In response to TD Cowen’s Jeffrey Osborne, Mastrangelo said moving an Eos system from four hours to 10 hours does not require changes to the battery system itself, only a change in how the system is operated. He said upgrading to DawnOS involves software and printed circuit board changes, with wiring changes depending on the configuration of the installed system.

Pipeline Expands to $24 Billion

Kroeker said total commercial opportunities increased to $24 billion, representing 107 gigawatt-hours, up 3% sequentially and 56% year-over-year. Mastrangelo said 55% of the pipeline is for systems with durations of eight hours or more, a segment where he said Eos competes on both technical performance and economics.

Kroeker said demand remains strong in PJM and NYISO, including work with Talen Energy on large storage projects at existing sites ahead of PJM’s reliability backstop procurement process. He also said Eos is seeing growing interest from utilities, utility-backed developers, hyperscalers and AI-driven projects.

The company also discussed a joint development agreement with TURBINE-X, which Kroeker said targets 2 gigawatt-hours of storage over the next several years, with initial deployments in 2027. The agreement combines TURBINE-X’s access to gas-fired generation with Eos’s Indensity solution for data centers and other applications.

Losses Narrow, CFO Transition Announced

Eos reported a gross loss of $44.4 million for the quarter, which Kroeker said represented a 157 percentage point margin improvement from the prior year. Adjusted gross loss was $39 million, excluding non-cash stock-based compensation and depreciation and amortization. Adjusted EBITDA was a loss of $68 million, which Kroeker said represented a 294 percentage point margin improvement from the prior year.

The company reported net income of $509 million, but Kroeker emphasized that net income is heavily affected by non-cash fair value accounting adjustments tied to warrants and derivatives. He said adjusted EBITDA is the more relevant operating measure.

Management also said Eos is still targeting positive adjusted gross margin later this year. In the Q&A, Mastrangelo said the company believes it will achieve positive adjusted EBITDA before the end of the year.

Kroeker said Alessandro Lagi will join Eos as chief financial officer in June, allowing Kroeker to return his full focus to commercial growth. Mastrangelo said Lagi brings public company finance leadership and industrial scaling experience, including work in the energy industry and at Johnson Controls.

About Eos Energy Enterprises NASDAQ: EOSE

Eos Energy Enterprises specializes in the development and deployment of scalable, long-duration energy storage systems designed to support the integration of renewable power and enhance grid reliability. The company's core technology centers on its proprietary zinc hybrid cathode (Znyth™) battery platform, which aims to deliver safe, low-cost, and durable performance for utility, commercial and industrial, and microgrid applications.

The company's flagship product, the Aurora™ energy storage system, combines its Znyth™ cells with modular power conversion and controls to offer flexible capacity ranging from one to three hours of discharge duration.

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