Fuel Tech Reports 2025 Third Quarter Financial Results

Rhea-AI Summary

Fuel Tech (NASDAQ: FTEK) reported Q3 2025 results: consolidated revenue of $7.5M versus $7.9M a year earlier, gross margin expanded to 48.9% from 43.4%, and net income was $0.3M (or $0.01 per share) compared with $0.08M a year ago. The company ended Q3 with $13.7M cash, $20.2M investments (short‑ and long‑term), and no debt, totaling $33.8M in cash and investments. APC backlog rose to $9.5M at Sept 30, 2025, up from $7.8M at June 30, 2025. Fuel Tech acquired Wahlco IP for $350,000 to expand APC offerings, and launched a commercially priced six‑month FUEL CHEM demonstration with an estimated annual revenue potential of $2.5–3.0M.

Positive

• Consolidated gross margin expanded to 48.9%
• Cash and investments of $33.8M with no debt
• APC backlog increased to $9.5M (up >20% since June 30, 2025)
• Adjusted EBITDA of $0.228M in Q3 2025 vs loss of $(0.035M) year-ago
• Acquired Wahlco IP for $350,000 to expand APC product portfolio
• Commercial FUEL CHEM demo with $2.5–3.0M annual revenue potential

Negative

• Consolidated revenue declined to $7.5M from $7.9M year-over-year
• APC segment revenue fell to $2.7M from $3.2M (≈15.6% decline)
• Long-term investments decreased to $7.97M from $10.88M (≈26.8% drop)

Insights

Market-Focused Financial Analyst

Profitability returned, balance sheet strengthened; backlog and a small strategic IP acquisition support modestly positive outlook.

Consolidated results show a return to net income of $303,000 in Q3 2025, improved gross margin to 48.9%, and Adjusted EBITDA of $228,000, while revenue modestly declined to $7.5 million. The company reports $33.8 million in cash and investments and no debt, and stockholders’ equity of $41.0 million, which together indicate a solid liquidity and capital position.

Operationally, APC revenue timing pressures reduced near-term top-line performance, but APC backlog rose to $9.5 million (up from $7.8 million at June 30, 2025), a >20% increase, and FUEL CHEM revenue expanded to $4.8 million with expected continued strength. Management completed a targeted IP acquisition for $350,000 to broaden APC offerings; the deal size is small versus balance sheet strength and may be accretive to aftermarket revenue if customer conversion occurs.

Key dependencies and risks include the timing of APC project execution and the six‑month commercial demonstration for a new FUEL CHEM customer that began in October 2025 and is expected to run for six months; the contract’s annualized revenue potential is stated at $2.5 to $3.0 million if run full-time. Monitor APC backlog conversion, the outcome and commercial adoption of the FUEL CHEM demonstration by mid-2026, and DGI demonstration progress through Q2 2026. Near-term impact appears modestly positive given profitability, higher margins, stronger liquidity, backlog growth, and a low-cost IP add-on.

11/04/2025 - 04:15 PM

WARRENVILLE, Ill., Nov. 04, 2025 (GLOBE NEWSWIRE) -- Fuel Tech, Inc. (NASDAQ: FTEK), a technology company using advanced engineering processes to provide emissions control systems and water treatment technologies in utility and industrial applications, today reported financial results for the third quarter ended September 30, 2025.

“We operated profitably in the third quarter, expanded customer relationships for our Air Pollution Control (APC) and FUEL CHEM^® business segments, and increased our APC backlog by more than 20% from June 30, 2025,” said Vincent J. Arnone, President and CEO. “We ended the third quarter in a very strong financial position with $33.8 million in cash and investments and no debt. Subsequent to quarter end, we expanded our APC solutions portfolio via a small strategic acquisition of complementary APC intellectual property from Wahlco, Inc., a leading environmental equipment and services company that has completed several hundred project installations worldwide over the past three decades.”   

Business Segment Performance

Mr. Arnone continued, “We generated improved quarter-over-quarter performance in our FUEL CHEM^® business segment during the third quarter of 2025. In October, we installed equipment at a coal-fired unit for a new FUEL CHEM customer in the U.S. for a commercially-priced demonstration program that recently commenced, and is expected to run for six months.    The annual revenue potential from this commercial contract is projected to be approximately $2.5 to $3.0 million based on the customer running the program full-time, with the revenue expected to generate historic FUEL CHEM gross margins.   We continue to believe that FUEL CHEM’s full year 2025 segment revenues will reach their highest levels since 2022.”

“Revenues generated by our APC business declined quarter-over-quarter, due primarily to customer-driven delays and project timing. In August, we announced $3.2 million of new awards from new and existing customers in the U.S., Europe and Southeast Asia. This activity supported an increase in consolidated APC segment backlog at September 30, 2025 to $9.5 million, up from $7.8 million at June 30, 2025 and $6.2 million at December 31, 2024.

“We are continuing to pursue significant prospects offered by the rising demand for power generation in support of data centers and traditional public utility entities. We remain actively engaged with multiple bids outstanding for our SCR (Selective Catalytic Reduction) technology to address the emissions control requirements of those opportunities that will develop and be implemented in the U.S. over the next several years.”  

Mr. Arnone continued, “Regarding the growth and development of our Dissolved Gas Infusion (DGI^®) technology, we had a very successful exhibition of DGI at the Water Environment Federation Technical Exhibition and Conference, or WEFTEC, in Chicago last month, and generated significant interest in the technology. We are continuing an extended demonstration of DGI at a fish hatchery in the Western U.S., which we expect will last until the second quarter of 2026. Our DGI system is currently performing well and is meeting customer expectations for the precise delivery of concentrated dissolved oxygen.”

IP Acquisition

As referenced earlier, subsequent to the end of the third quarter Fuel Tech acquired all of the intellectual property assets and customer-related activities of Wahlco, Inc. for total cash consideration of $350,000.

“This acquisition represents a smart, cost-effective expansion of our IP portfolio by identifying high-value assets at a modest price. The acquired technology aligns with our long-term vision to address customer APC needs on a global basis.” 

The acquired portfolio of assets includes technology applicable to flue gas conditioning systems; ammonia handling equipment for all size applications associated with utilities, independent power producers, oil and gas refineries, pulp and paper mills, cement plants, and steel mills; and urea to ammonia conversion technologies for nitrogen oxide reduction. Also included as part of the portfolio are customer installation and aftermarket market data, which we believe will drive accretive aftermarket revenues.

Third Quarter 2025 (“Q3 2025”) Consolidated Results Overview
All comparisons are to the third quarter ended September 30, 2024 unless otherwise stated.

Consolidated revenues for Q3 2025 declined to $7.5 million from $7.9 million, mainly due to lower APC revenues resulting from the timing of project execution on current contracts, partially offset by higher FUEL CHEM revenues.   

Consolidated gross margin for Q3 2025 expanded to 48.9% of revenues from 43.4% of revenues, reflecting higher APC and FUEL CHEM segment gross margins.

SG&A expenses of $3.2 million were consistent with the prior year period.

Interest income was flat at $0.3 million and related primarily to interest received on the held-to-maturity debt securities and money market funds.

Net income in Q3 2025 was $303,000, or $0.01 per share, compared to net income of $80,000, or $0.00 per share.

Adjusted EBITDA was $228,000 in Q3 2025 compared to an Adjusted EBITDA loss of $(35,000).

APC segment revenue decreased to $2.7 million from $3.2 million, primarily related to timing of project execution on existing contracts. Segment gross margin expanded to 47.2% from 35.0%, primarily due to product and project mix.

FUEL CHEM segment revenue rose to $4.8 million from $4.6 million, primarily due to increased operation dispatch at legacy accounts, as well as sustained business from a new customer account added midyear in 2024. Segment gross margin expanded to 49.8% from 49.2% due to an increased volume of sales activity combined with relatively flat segment administrative expenses.

Financial Condition

At September 30, 2025, cash and cash equivalents were $13.7 million, short-term investments were $12.2 million, and long-term investments totaled $8.0 million. Stockholders’ equity at September 30, 2025 was $41.0 million, or $1.31 per share, and the Company had no debt.

Conference Call

Management will host a conference call on Wednesday, November 5, 2025 at 10:00 am ET / 9:00 am CT to discuss the results and business activities. Interested parties may participate in the call by dialing:

• (877) 423-9820 (Domestic) or
• (201) 493-6749 (International)

The conference call will also be accessible via the Upcoming Events section of the Company’s web site at www.ftek.com. Following management’s opening remarks, there will be a question-and-answer session.

About Fuel Tech

Fuel Tech develops and commercializes state-of-the-art proprietary technologies for air pollution control, process optimization, water treatment, and advanced engineering services. These technologies enable customers to operate in a cost-effective and environmentally sustainable manner. Fuel Tech is a leader in nitrogen oxide (NO_x) reduction and particulate control technologies and its solutions have been installed on over 1,300 utility, industrial and municipal units worldwide. The Company’s FUEL CHEM^® technology improves the efficiency, reliability, fuel flexibility, boiler heat rate, and environmental status of combustion units by controlling slagging, fouling, corrosion and opacity. Water treatment technologies include DGI^® Dissolved Gas Infusion Systems which utilize a patented saturator and a patent-pending channel injector to deliver supersaturated oxygen solutions and other gas-water combinations to target process applications or environmental issues. This infusion process has a variety of applications in the water and wastewater industries, including remediation, aeration, biological treatment and wastewater odor management. Many of Fuel Tech’s products and services rely heavily on the Company’s exceptional Computational Fluid Dynamics modeling capabilities, which are enhanced by internally developed, high-end visualization software. For more information, visit Fuel Tech’s web site at www.ftek.com.

NOTE REGARDING FORWARD-LOOKING STATEMENTS

This press release contains “forward-looking statements” as defined in Section 21E of the Securities Exchange Act of 1934, as amended, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and reflect Fuel Tech’s current expectations regarding future growth, results of operations, cash flows, performance and business prospects, and opportunities, as well as assumptions made by, and information currently available to, our management. Fuel Tech has tried to identify forward-looking statements by using words such as “anticipate,” “believe,” “plan,” “expect,” “estimate,” “intend,” “will,” and similar expressions, but these words are not the exclusive means of identifying forward-looking statements. These statements are based on information currently available to Fuel Tech and are subject to various risks, uncertainties, and other factors, including, but not limited to, those discussed in Fuel Tech’s Annual Report on Form 10-K in Item 1A under the caption “Risk Factors,” and subsequent filings under the Securities Exchange Act of 1934, as amended, which could cause Fuel Tech’s actual growth, results of operations, financial condition, cash flows, performance and business prospects and opportunities to differ materially from those expressed in, or implied by, these statements. Fuel Tech undertakes no obligation to update such factors or to publicly announce the results of any of the forward-looking statements contained herein to reflect future events, developments, or changed circumstances or for any other reason. Investors are cautioned that all forward-looking statements involve risks and uncertainties, including those detailed in Fuel Tech’s filings with the Securities and Exchange Commission.

FUEL TECH, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (in thousands, except share and per share data)
	September 30,				December 31,
	2025				2024
ASSETS
Current assets:
Cash and cash equivalents	$	13,677			$	8,510
Short-term investments		12,183				10,184
Accounts receivable, less current expected credit loss of $108 and $106, respectively		4,828				9,368
Inventories, net		402				397
Prepaid expenses and other current assets		864				1,160
Total current assets		31,954				29,619
Property and equipment, net of accumulated depreciation of $19,312 and $18,958, respectively		4,820				5,084
Goodwill		2,116				2,116
Other intangible assets, net of accumulated amortization of $552 and $525, respectively		306				327
Right-of-use operating lease assets, net		558				585
Long-term investments		7,969				10,875
Other assets		190				191
Total assets	$	47,913			$	48,797
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	2,402			$	2,915
Accrued liabilities:
Operating lease liabilities - current		87				77
Employee compensation		748				1,248
Other accrued liabilities		2,674				1,615
Total current liabilities		5,911				5,855
Operating lease liabilities - non-current		514				548
Deferred income taxes, net		176				176
Other liabilities		303				263
Total liabilities		6,904				6,842
Stockholders’ equity:
Common stock, $.01 par value, 40,000,000 shares authorized, 32,281,179 and 31,767,329 shares issued, and 31,074,438 and 30,708,273 shares outstanding, respectively		322				317
Additional paid-in capital		165,559				165,295
Accumulated deficit		(120,597	)			(119,472	)
Accumulated other comprehensive loss		(1,783	)			(1,915	)
Nil coupon perpetual loan notes		76				76
Treasury stock, at cost		(2,568	)			(2,346	)
Total stockholders’ equity		41,009				41,955
Total liabilities and stockholders’ equity	$	47,913			$	48,797

See notes to condensed consolidated financial statements.

FUEL TECH, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except share and per share data)
	Three Months Ended								Nine Months Ended
	September 30,								September 30,
	2025				2024				2025				2024
Revenues	$	7,490			$	7,851			$	19,430			$	19,850
Costs and expenses:
Cost of sales		3,829				4,444				10,281				11,462
Selling, general and administrative		3,207				3,225				9,895				9,815
Research and development		450				361				1,510				1,159
		7,486				8,030				21,686				22,436
Operating income (loss)		4				(179	)			(2,256	)			(2,586	)
Interest income		311				323				1,127				968
Other (expense) income, net		(5	)			(63	)			15				1,576
Income (loss) before income taxes		310				81				(1,114	)			(42	)
Income tax expense		(7	)			(1	)			(11	)			(18	)
Net income (loss)	$	303			$	80			$	(1,125	)		$	(60	)
Net income (loss) per common share:
Basic net income (loss) per common share	$	0.01			$	0.00			$	(0.04	)		$	(0.00	)
Diluted net income (loss) per common share	$	0.01			$	0.00			$	(0.04	)		$	(0.00	)
Weighted-average number of common shares outstanding:
Basic		31,074,000				30,708,000				30,890,000				30,526,000
Diluted		31,293,000				30,848,000				30,890,000				30,526,000

See notes to condensed consolidated financial statements.

FUEL TECH, INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) (in thousands)
	Three Months Ended								Nine Months Ended
	September 30,								September 30,
	2025				2024				2025				2024
Net income (loss)	$	303			$	80			$	(1,125	)		$	(60	)
Other comprehensive income (loss):
Foreign currency translation adjustments		(14	)			106				132				(32	)
Comprehensive income (loss)	$	289			$	186			$	(993	)		$	(92	)

See notes to condensed consolidated financial statements.

FUEL TECH, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands)
	Nine Months Ended
	September 30,
	2025				2024
Operating Activities
Net loss	$	(1,125	)		$	(60	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation		490				248
Amortization		27				42
Non-cash interest income on held-to-maturity securities		(91	)			(109	)
Stock-based compensation, net of forfeitures		269				337
Changes in operating assets and liabilities:
Accounts receivable		3,066				(845	)
Employee retention credit receivable		1,677				(1,677	)
Inventory		(4	)			(3	)
Prepaid expenses, other current assets and other non-current assets		318				655
Accounts payable		(560	)			842
Accrued liabilities and other non-current liabilities		516				(1,215	)
Net cash provided by (used in) operating activities		4,583				(1,785	)
Investing Activities
Purchases of equipment and patents		(231	)			(316	)
Purchases of debt securities		(10,004	)			(14,072	)
Maturities of debt securities		11,000				11,000
Net cash provided by (used in) investing activities		765				(3,388	)
Financing Activities
Taxes paid on behalf of award participants		(222	)			(95	)
Net cash used in financing activities		(222	)			(95	)
Effect of exchange rate fluctuations on cash		41				(36	)
Net increase (decrease) in cash and cash equivalents		5,167				(5,304	)
Cash and cash equivalents at beginning of period		8,510				17,578
Cash and cash equivalents at end of period	$	13,677			$	12,274

See notes to condensed consolidated financial statements.

FUEL TECH, INC. Segment Data- Reporting Segments (Unaudited) (in thousands)
Information about reporting segment net sales and gross margin from operations is provided below:
	Air Pollution				FUEL CHEM
Three months ended September 30, 2025	Control Segment				Segment				Other				Total
Revenues from external customers	$	2,707			$	4,783			$	—			$	7,490
Cost of sales		(1,428	)			(2,401	)			—				(3,829	)
Gross margin		1,279				2,382				—				3,661
Selling, general and administrative		—				—				(3,207	)			(3,207	)
Research and development		—				—				(450	)			(450	)
Operating income (loss) from operations	$	1,279			$	2,382			$	(3,657	)		$	4

	Air Pollution				FUEL CHEM
Three months ended September 30, 2024	Control Segment				Segment				Other				Total
Revenues from external customers	$	3,224			$	4,627			$	—			$	7,851
Cost of sales		(2,095	)			(2,349	)			—				(4,444	)
Gross margin		1,129				2,278				—				3,407
Selling, general and administrative		—				—				(3,225	)			(3,225	)
Research and development		—				—				(361	)			(361	)
Operating income (loss) from operations	$	1,129			$	2,278			$	(3,586	)		$	(179	)

	Air Pollution				FUEL CHEM
Nine months ended September 30, 2025	Control Segment				Segment				Other				Total
Revenues from external customers	$	6,515			$	12,915			$	—			$	19,430
Cost of sales		(3,713	)			(6,568	)			—				(10,281	)
Gross margin		2,802				6,347				—				9,149
Selling, general and administrative		—				—				(9,895	)			(9,895	)
Research and development		—				—				(1,510	)			(1,510	)
Operating income (loss) from operations	$	2,802			$	6,347			$	(11,405	)		$	(2,256	)

	Air Pollution				FUEL CHEM
Nine months ended September 30, 2024	Control Segment				Segment				Other				Total
Revenues from external customers	$	9,491			$	10,359			$	—			$	19,850
Cost of sales		(5,927	)			(5,535	)			—				(11,462	)
Gross margin		3,564				4,824				—				8,388
Selling, general and administrative		—				—				(9,815	)			(9,815	)
Research and development	$	—				—				(1,159	)			(1,159	)
Operating income (loss) from operations	$	3,564			$	4,824			$	(10,974	)		$	(2,586	)

FUEL TECH, INC. Geographic Segment Financial Data (Unaudited) (in thousands)
Information concerning our operations by geographic area is provided below. Revenues are attributed to countries based on the location of the end-user. Assets are those directly associated with operations of the geographic area.
	Three Months Ended								Nine Months Ended
	September 30,								September 30,
	2025				2024				2025				2024
Revenues:
United States	$	5,626			$	5,453			$	15,427			$	13,519
Foreign		1,864				2,398				4,003				6,331
	$	7,490			$	7,851			$	19,430			$	19,850

	September 30,				December 31,
	2025				2024
Assets:
United States	$	44,917			$	44,430
Foreign		2,996				4,367
	$	47,913			$	48,797

FUEL TECH, INC. RECONCILIATION OF GAAP NET LOSS TO EBITDA AND ADJUSTED EBITDA (Unaudited) (in thousands)
	Three Months Ended								Nine Months Ended
	September 30,								September 30,
	2025				2024				2025				2024
Net income (loss)	$	303			$	80			$	(1,125	)		$	(60	)
Interest income		(311	)			(323	)			(1,127	)			(968	)
Income tax expense		7				1				11				18
Depreciation expense		163				87				490				248
Amortization expense		9				11				27				42
EBITDA		171				(144	)			(1,724	)			(720	)
Stock compensation expense		57				109				269				337
Gain on employee retention credit		-				-				-				(1,677	)
Adjusted EBITDA	$	228			$	(35	)		$	(1,455	)		$	(2,060	)

Adjusted EBITDA

To supplement the Company's consolidated financial statements presented in accordance with generally accepted accounting principles in the United States (GAAP), the Company has provided an Adjusted EBITDA disclosure as a measure of financial performance. Adjusted EBITDA is defined as net income (loss) before interest expense, income tax expense (benefit), depreciation expense, amortization expense, stock compensation expense and gain on employee retention credit. The Company's reference to these non-GAAP measures should be considered in addition to results prepared in accordance with GAAP standards, but are not a substitute for, or superior to, GAAP results.

Adjusted EBITDA is provided to enhance investors' overall understanding of the Company's current financial performance and ability to generate cash flow, which we believe is a meaningful measure for our investor and analyst communities. In many cases non-GAAP financial measures are utilized by these individuals to evaluate Company performance and ultimately determine a reasonable valuation for our common stock. A reconciliation of Adjusted EBITDA to the nearest GAAP measure of net income (loss) has been included in the above financial table.

CONTACT:

Vince Arnone             
President and CEO      
(630) 845-4500

Devin Sullivan
Managing Director
The Equity Group Inc.
dsullivan@theequitygroup.com

FAQ

What did Fuel Tech (FTEK) report for Q3 2025 revenue and net income?

Fuel Tech reported $7.5M in Q3 2025 revenue and net income of $0.3M (or $0.01 per share).

How large is Fuel Tech's (FTEK) cash and investments position at Sept 30, 2025?

Fuel Tech held $13.7M cash, $12.2M short-term investments, and $8.0M long-term investments, totaling $33.8M in cash and investments.

What change occurred to Fuel Tech's (FTEK) APC backlog in Q3 2025?

APC backlog increased to $9.5M at Sept 30, 2025, up from $7.8M at June 30, 2025 (more than a 20% increase).

Did Fuel Tech (FTEK) make any acquisitions in 2025 and what was the cost?

Yes — Fuel Tech acquired Wahlco intellectual property and related customer activities for $350,000 to broaden APC offerings.

What is the revenue potential of Fuel Tech's (FTEK) new FUEL CHEM demonstration?

The commercially priced six-month FUEL CHEM demonstration has an estimated annual revenue potential of $2.5–3.0M if run full-time.

How did Fuel Tech's (FTEK) margins and adjusted EBITDA perform in Q3 2025?

Consolidated gross margin expanded to 48.9%, and Adjusted EBITDA was $0.228M for the quarter versus an Adjusted EBITDA loss of $(0.035M) a year earlier.