[10-Q] AirJoule Technologies Corporation Quarterly Earnings Report

Rhea-AI Filing Summary

AirJoule Technologies Corporation (AIRJ) reported consolidated assets of $376.1 million and stockholders' equity of $288.6 million as of June 30, 2025. The company held $30.5 million in cash and cash equivalents and reported net income of $17.4 million for the six months ended June 30, 2025 and $2.5 million for the quarter ended June 30, 2025.

The balance sheet reflects a $343.9 million investment in AirJoule, LLC and a deferred tax liability of $78.1 million. During the period the company received net proceeds of $14.56 million from a PIPE offering and has an unused committed equity facility of up to $30.0 million. The company contributed $10.0 million to the AirJoule joint venture during the six months and discloses a remaining commitment to the JV of $85.0 million. Contingent and liability-classified equity awards changed materially: the Earnout Shares liability decreased to $5.416 million and the Subject Vesting Shares liability decreased to $1.411 million as of June 30, 2025.

Positive

• Cash position strengthened to $30,502,711 as of June 30, 2025
• Net income of $17,391,871 for the six months ended June 30, 2025 (and $2,513,213 for the quarter)
• Significant investment recorded: Investment in AirJoule, LLC of $343,858,688 on the balance sheet
• Successful equity financing: Net proceeds from the April 2025 PIPE of $14,556,106 and an available Equity Line Purchase Agreement for up to $30,000,000

Negative

• Operating loss of $7,353,117 for the six months ended June 30, 2025
• Equity-method loss from AirJoule, LLC of $4,319,945 for the six months ended June 30, 2025
• Net cash used in operating activities of $2,163,485 for the six months ended June 30, 2025
• Large remaining JV capital commitment of $85.0 million as of June 30, 2025
• Significant deferred tax liability of $78,054,508 as of June 30, 2025
• Management warns that future operating losses and negative operating cash flows may increase and additional financing may be required

Insights

Financial Analyst

TL;DR: Results show modest positive net income and stronger liquidity from PIPE proceeds, offset by operating losses and equity-method JV losses.

The company reported consolidated net income of $17.4 million for the six months ended June 30, 2025 and held $30.5 million in cash. Other income items and fair value adjustments materially affected reported results; total other income, net for the six months was $21.543 million. Operating results continue to show an operating loss of $7.35 million for the six-month period and an equity loss from the AirJoule JV of $4.32 million. The balance sheet contains a significant equity-method investment in AirJoule, LLC of $343.9 million and a sizeable deferred tax liability of $78.1 million. Liquidity was supported this period by $14.56 million of net PIPE proceeds and an available equity line facility of up to $30.0 million that has not yet been drawn.

Risk & Corporate Finance Analyst

TL;DR: Material contingent liabilities and sizable future JV funding commitments create tangible liquidity and execution risk despite current cash on hand.

The company discloses a remaining capital contribution commitment to the AirJoule JV of $85.0 million as of June 30, 2025 and expects that future operating losses and negative operating cash flows may increase. Net cash used in operating activities was $2.16 million for the six months. Although the Equity Line Purchase Agreement provides capacity to raise up to $30.0 million, sales under that facility have not commenced. The consolidated balance sheet also carries liability-classified equity awards (Earnout Shares $5.416 million; Subject Vesting Shares $1.411 million) and a deferred tax liability of $78.05 million. These items materially affect future funding needs and downside risk if expected JV contributions or external financing are delayed or unavailable.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________ to ______________

Commission File Number 001-41151

AIRJOULE TECHNOLOGIES CORPORATION

(Exact name of registrant as specified in its charter)

Delaware		86-2962208
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

34361 Innovation Drive Ronan, Montana		59864
(Address of principal executive offices)		(Zip Code)

(800) 942-3083

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Class A common stock, par value $0.0001 per share		AIRJ		The Nasdaq Stock Market LLC
Warrants to purchase Class A common stock		AIRJW		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 1, 2025, there were 60,439,593 shares of the registrant’s Class A common stock, par value $0.0001 per share, issued and outstanding.

AIRJOULE TECHNOLOGIES CORPORATION

TABLE OF CONTENTS

		Page
Part 1 - Financial Information		1
Item 1.	Condensed Consolidated Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024 (Unaudited)	1
	Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024 (Unaudited)	2
	Condensed Consolidated Statements of Changes in Members’ and Stockholders’ Equity (Deficit) for the Three and Six Months Ended June 30, 2025 and 2024 (Unaudited)	3
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 (Unaudited)	5
	Notes to the Unaudited Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition And Results of Operations	30
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	38
Item 4.	Controls and Procedures	38
Part II - Other Information		39
Item 1.	Legal Proceedings	39
Item 1A.	Risk Factors	39
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 3.	Defaults Upon Senior Securities	39
Item 4.	Mine Safety Disclosures	39
Item 5.	Other Information	39
Item 6.	Exhibits	41
Signatures		42

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PART 1 - FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

AIRJOULE TECHNOLOGIES CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

		June 30,				December 31,
		2025				2024
		(unaudited)
Assets
Current assets
Cash, cash equivalents and restricted cash		$	30,502,711			$	28,021,748
Due from related party			545,013				2,820,129
Prepaid expenses and other current assets			968,892				613,754
Total current assets			32,016,616				31,455,631
Operating lease right-of-use asset			131,235				147,001
Property and equipment, net			23,872				16,373
Investment in AirJoule, LLC			343,858,688				338,178,633
Other assets			54,482				54,482
Total assets		$	376,084,893			$	369,852,120
Liabilities and stockholders’ equity
Current liabilities
Accounts payable		$	296,587			$	79,202
Other accrued expenses			2,197,206				1,720,318
Operating lease liability, current			32,886				30,227
True Up Shares liability			—				2,189,000
Total current liabilities			2,526,679				4,018,747
Earnout Shares liability			5,416,000				24,524,000
Subject Vesting Shares liability			1,411,000				7,819,000
Operating lease liability, non-current			107,113				124,002
Deferred tax liability			78,054,508				81,256,047
Total liabilities			87,515,300				117,741,796
Commitments and contingencies (Note 12)
Stockholders’ equity
Preferred stock, $0.0001 par value; 25,000,000 authorized shares and 0 shares issued    and outstanding as of June 30, 2025 and December 31, 2024		$	—			$	—
Class A common stock, $0.0001 par value; 600,000,000 authorized shares and   60,439,593 and 55,928,661 shares issued and outstanding as of June 30, 2025    and December 31, 2024, respectively			6,044				5,593
Additional paid-in capital			72,644,217				53,577,270
Retained earnings			215,919,332				198,527,461
Total stockholders’ equity			288,569,593				252,110,324
Total liabilities and stockholders’ equity		$	376,084,893			$	369,852,120

The accompanying notes are an integral part of these condensed consolidated financial statements.

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AIRJOULE TECHNOLOGIES CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

		Three Months Ended June 30,								Six Months Ended June 30,
		2025				2024				2025				2024
Cost and expenses:
General and administrative		$	3,751,211			$	3,211,205			$	6,537,695			$	4,024,444
Research and development			401,623				1,050,804				789,542				1,896,961
Sales and marketing			7,794				74,841				22,003				112,566
Transaction costs incurred in connection with business combination			—				—				—				54,693,103
Depreciation and amortization			2,289				1,216				3,877				2,301
Loss from operations			(4,162,917	)			(4,338,066	)			(7,353,117	)			(60,729,375	)
Other income (expense):
Interest income			283,733				216,480				526,758				242,626
Gain on contribution to AirJoule, LLC			—				—				—				333,500,000
Equity loss from investment in AirJoule, LLC			(2,089,667	)			(580,788	)			(4,319,945	)			(607,170	)
Change in fair value of Earnout Shares liability			6,276,000				13,064,000				19,108,000				5,392,000
Change in fair value of True Up Shares liability			—				(136,000	)			106,106				133,000
Change in fair value of Subject Vesting Shares liability			934,000				1,759,000				6,408,000				(666,000	)
Gain on settlement of legal fees			—				2,207,445				—				2,207,445
Other expense, net			(286,818	)			—				(285,470	)			—
Total other income, net			5,117,248				16,530,137				21,543,449				340,201,901
Income before income taxes			954,331				12,192,071				14,190,332				279,472,526
Income tax benefit (expense)			1,558,882				1,237,824				3,201,539				(84,487,339	)
Net income		$	2,513,213			$	13,429,895			$	17,391,871			$	194,985,187
Weighted average Class A common stock outstanding, basic			59,247,717				49,560,529				57,656,530				43,357,928
Basic net income per share, Class A common stock		$	0.04			$	0.25			$	0.30			$	4.05
Weighted average Class A common stock outstanding, diluted			60,179,241				51,358,716				58,727,169				44,995,234
Diluted net income, per share, Class A common stock		$	0.04			$	0.24			$	0.30			$	3.92
Weighted average Class B common stock outstanding, basic and diluted			—				4,759,642				—				4,759,642
Basic net income per share, Class B common stock		$	—			$	0.25			$	—			$	4.05
Diluted net income per share, Class B common stock		$	—			$	0.24			$	—			$	3.92

The accompanying notes are an integral part of these condensed consolidated financial statements.

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AIRJOULE TECHNOLOGIES CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN MEMBERS’ AND STOCKHOLDERS’ EQUITY (DEFICIT) (UNAUDITED)

For the Three and Six Months Ended June 30, 2025

		Class A Common Stock								Additional Paid-In
		Shares				Amount				Capital				Retained Earnings				Total Stockholders’ Equity
Balance at December 31, 2024			55,928,661			$	5,593			$	53,577,270			$	198,527,461			$	252,110,324
Exercise of options			147,579				15				41,745				—				41,760
Share-based compensation		—					—				1,069,076				—				1,069,076
Issuance of True up Shares			275,880				28				2,082,866				—				2,082,894
Net income		—					—				—				14,878,658				14,878,658
Balance at March 31, 2025			56,352,120			$	5,636			$	56,770,957			$	213,406,119			$	270,182,712
Exercise of options			148,486				15				57,943				—				57,958
Share-based compensation			—				—				1,571,980				—				1,571,980
PIPE offering proceeds, net			3,775,126				377				14,243,353				—				14,243,730
Issuance of common stock upon vesting of restricted stock units			163,861				16				(16	)			—				—
Net income			—				—				—				2,513,213				2,513,213
Balance at June 30, 2025			60,439,593			$	6,044			$	72,644,217			$	215,919,332			$	288,569,593

For the Three and Six Months Ended June 30, 2024

		Members’				Preferred				Class A Common Stock								Class B Common Stock
		Contribution				Units				Shares				Amount				Shares				Amount				Subscription Receivable				Additional Paid-In Capital				Retained Earnings (Accumulated Deficit)				Total Stockholders’ Equity (Deficit)
Balance at December 31, 2023		$	2,109,310			$	9,158,087				—			$	—				—			$	—			$	—			$	—			$	(17,168,101	)		$	(5,900,704	)
Retroactive application of recapitalization			(2,109,310	)			(9,158,087	)			32,731,583				3,274				4,759,642				476				—				11,263,647				—				—
Balance at December 31, 2023		$	—			$	—				32,731,583			$	3,274				4,759,642			$	476			$	—			$	11,263,647			$	(17,168,101	)		$	(5,900,704	)
Issuance of common stock			—				—				5,807,647				581				—				—				(6,000,000	)			49,364,419				—				43,365,000
Exercise of warrants			—				—				380,771				38				—				—				—				45,722				—				45,760
Exercise of options			—				—				2,141,839				214				—				—				—				56,036				—				56,250
Reverse capitalization, net of transaction costs			—				—				8,001,930				800				—				—				—				(21,028,277	)			—				(21,027,477	)
Net income			—				—				—				—				—				—				—				—				181,555,292				181,555,292
Balance at March 31, 2024		$	—			$	—				49,063,770			$	4,907				4,759,642			$	476			$	(6,000,000	)		$	39,701,547			$	164,387,191			$	198,094,121
Issuance of common stock pursuant to June 2024 subscription agreement			—				—				1,238,500				124				—				—				—				12,384,876				—				12,385,000
Exercise of warrants			—				—				705,758				71				—				—				—				(71	)			—				—
Exercise of options			—				—				8,000				8				—				—				—				3,912				—				3,920
Subscription proceeds received			—				—				—				—				—				—				6,000,000				—				—				6,000,000
Share-based compensation			—				—				—				—				—				—				—				150,519				—				150,519
Net income			—				—				—				—				—				—				—				—				13,429,895				13,429,895
Balance at June 30, 2024		$	—			$	—				51,016,028			$	5,110				4,759,642			$	476			$	—			$	52,240,783			$	177,817,086			$	230,063,455

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The accompanying notes are an integral part of these condensed consolidated financial statements.

4

AIRJOULE TECHNOLOGIES CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

		Six Months Ended June 30,
		2025				2024
Cash flows from operating activities
Net income		$	17,391,871			$	194,985,187
Adjustment to reconcile net income to cash used in operating activities:
Depreciation and amortization			3,877				2,301
Deferred tax expense (benefit)			(3,201,539	)			84,487,339
Amortization of operating lease right-of-use assets			15,766				59,709
Change in fair value of Earnout Shares liability			(19,108,000	)			(5,392,000	)
Change in fair value of True Up Shares liability			(106,106	)			(133,000	)
Change in fair value of Subject Vesting Shares liability			(6,408,000	)			666,000
Change in fair value of Equity Line Obligation liability			286,819				—
Gain on contribution to AirJoule, LLC			—				(333,500,000	)
Equity loss from investment in AirJoule, LLC			4,319,945				607,170
Non-cash transaction costs in connection with business combination			—				53,721,000
Gain on settlement of legal fees			—				(2,207,445	)
Share-based compensation			2,419,596				150,519
Changes in operating assets and liabilities:
Due from related party			2,496,577				—
Due to related party			—				(1,440,000	)
Prepaid expenses and other current assets			(355,138	)			(806,153	)
Operating lease liabilities			(14,230	)			(56,818	)
Accounts payable			217,385				(3,157,317	)
Accrued expenses, accrued transaction costs and other liabilities			(122,308	)			(5,563,053	)
Net cash used in operating activities			(2,163,485	)			(17,576,561	)
Cash flows from investing activities
Purchases of fixed assets			(11,376	)			(6,554	)
Investment in AirJoule, LLC			(10,000,000	)			(10,000,000	)
Net cash used in investing activities			(10,011,376	)			(10,006,554	)
Cash flows from financing activities
Proceeds from the exercise of warrants			—				45,760
Proceeds from the exercise of options			99,718				60,170
Proceeds from the PIPE offering, net			14,556,106				—
Proceeds from the issuance of common stock pursuant to subscription agreements			—				61,750,000
Net cash provided by financing activities			14,655,824				61,855,930
Net increase in cash, cash equivalents and restricted cash			2,480,963				34,272,815
Cash, cash equivalents and restricted cash, beginning of period			28,021,748				375,796
Cash, cash equivalents and restricted cash, end of the period		$	30,502,711			$	34,648,611
Supplemental non-cash investing and financing activities:
Issuance of True Up Shares		$	2,082,894			$	—
Deferred offering costs included in accrued expenses and other current liabilities		$	312,375			$	—
Initial recognition of True Up Shares liability		$	—			$	555,000
Initial recognition of Subject Vesting Shares liability		$	—			$	11,792,000
Initial recognition of ROU asset and operating lease liability		$	—			$	172,649
Liabilities combined in recapitalization, net		$	—			$	8,680,477
Contribution to AirJoule, LLC of license to technology		$	—			$	333,500,000
Supplemental cash flow information:
Taxes paid		$	—			$	—

The accompanying notes are an integral part of these condensed consolidated financial statements.

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AIRJOULE TECHNOLOGIES CORPORATION

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1 — ORGANIZATION AND BUSINESS OPERATIONS

We are an advanced technology company whose purpose is to free the world from its water and energy constraints by delivering groundbreaking sorption technologies. Our vision is to be the leading technology platform that unleashes the power of water from air. AirJoule produces pure distilled water from air, and our proprietary AirJoule platform, at commercial scale, will mitigate water scarcity through distributed water generation for businesses and consumers around the world. Our products are especially valuable for industrial users, which generate significant amounts of waste heat that can be used to power our sorption technologies to produce low cost pure distilled water and dehumidified air – two key inputs for a variety of industrial activities, including data centers and advanced manufacturing. In HVAC applications, AirJoule is designed to reduce energy consumption, minimize or even eliminate the use of environmentally-harmful refrigerants, and generate material cost efficiencies for air conditioning systems. We are focused on commercialization and scaling manufacturing of our AirJoule products through our global collaborations, including with GE Vernova and Carrier Global Corporation (“Carrier”), and we believe that deploying AirJoule units worldwide will serve our purpose of freeing the world of its water and energy constraints.

Power & Digital Infrastructure Acquisition II Corp (“XPDB”) entered into an Agreement and Plan of Merger (the “Merger Agreement”), dated June 5, 2023, as amended on February 5, 2024, with XPDB Merger Sub, LLC, a direct wholly-owned subsidiary of XPDB (“Merger Sub”), and AirJoule Technologies LLC, formerly known as Montana Technologies LLC (“Legacy Montana”). On March 14, 2024, pursuant to the Merger Agreement, Merger Sub was merged with and into Legacy Montana, with Legacy Montana surviving the merger as a wholly-owned subsidiary of XPDB (the “Merger” and, together with the other transactions contemplated by the Merger Agreement, the “Business Combination”). In connection with closing the Business Combination (the “Closing”), XPDB changed its name from “Power & Digital Infrastructure Acquisition II Corp.” to “Montana Technologies Corporation.”

In November 2024, to better align the Company’s name with its business operations and AirJoule technology, the Company changed its name from Montana Technologies Corporation to AirJoule Technologies Corporation, and its wholly-owned subsidiary changed its name from Montana Technologies LLC to AirJoule Technologies LLC.

Prior to the Business Combination, all of the outstanding preferred units of Legacy Montana were converted into Class B common units. As a result of the Business Combination, (i) each issued and outstanding Class B common unit and Class C common unit of Legacy Montana was converted into the right to receive approximately 23.8 shares of newly issued shares of Class A common stock of the Company, (ii) each issued and outstanding class A common unit of Legacy Montana converted into the right to receive approximately 23.8 shares of newly issued shares of Class B common stock of the Company and (iii) each option to purchase common units of Legacy Montana converted into the right to receive an option to purchase Class A common stock of the Company having substantially similar terms to the corresponding option, including with respect to vesting and termination-related provisions, except that such options represented the right to receive a number of shares of Class A common stock equal to the number of common units subject to the corresponding option immediately prior to the Closing multiplied by approximately 23.8.

The Business Combination was accounted for as a reverse recapitalization in accordance with U.S. generally accepted accounting principles (“GAAP”). Under this method of accounting, although XPDB acquired the outstanding equity interest in Legacy Montana in the Business Combination, XPDB is treated as the acquired company and Legacy Montana was treated as the accounting acquirer for financial statement purposes. Accordingly, the Business Combination was treated as the equivalent of Legacy Montana issuing stock for the net assets of XPDB, accompanied by a recapitalization.

Furthermore, the historical financial statements of Legacy Montana became the historical financial statements of the Company upon the consummation of the Merger. As a result, the condensed consolidated financial statements reflect (i) the historical operating results of Legacy Montana prior to the Business Combination; (ii) the combined results of XPDB and Legacy Montana following the Closing; (iii) the assets and liabilities of Legacy Montana at their historical cost and (iv) Legacy Montana’s equity structure for all periods presented, as affected by the recapitalization presentation after completion of the Business Combination. See Note 4 - Recapitalization for further details of the Business Combination.

On January 25, 2024, Legacy Montana entered into a joint venture formation framework agreement (the “Framework Agreement”) with GE Ventures LLC (“GE Vernova”), a Delaware limited liability company and, solely for the purposes specified therein, GE Vernova LLC, a Delaware limited liability company, pursuant to which Legacy Montana and GE Vernova agreed, subject to the terms and conditions of the Framework Agreement, including certain closing conditions specified therein, to form a joint venture (the “AirJoule JV”) in which Legacy Montana and GE Vernova will each hold a 50% interest. The joint venture transaction closed on March 4, 2024. AirJoule, LLC, the entity formed under this agreement, is included under the equity method of accounting within these financial statements. See Note 5 - Equity Method Investment for further details.

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Note 2 — LIQUIDITY AND CAPITAL RESOURCES

The April 2025 PIPE

On April 23, 2025, the Company entered into subscription agreements (the “April 2025 PIPE Subscription Agreements”) with certain investors (the “April 2025 PIPE Investors”), pursuant to which, among other things, the April 2025 PIPE Investors agreed to subscribe for and purchase from AirJoule, and AirJoule agreed to issue and sell to the April 2025 PIPE Investors, an aggregate of 3,775,126 newly issued shares of Class A common stock at a purchase price of $3.98 per share on the terms and subject to the conditions set forth therein. The April 2025 PIPE Subscription Agreements entitled the April 2025 PIPE Investors to shelf registration rights with respect to the shares of Class A common stock they purchased. The transaction closed on April 25, 2025, and the shares of Class A common stock were issued and sold to the April 2025 PIPE Investors in reliance on Section 4(a)(2) of the Securities Act.

Committed Equity Facility

On March 25, 2025, the Company entered into a common stock purchase agreement (the “Equity Line Purchase Agreement”) with B. Riley Principal Capital II, LLC (the “Equity Line Investor”). Under the terms and subject to the conditions of the Equity Line Purchase Agreement, the Company has the right, but not the obligation, to sell to the Equity Line Investor, over a 36-month period, up to an aggregate of $30,000,000 of newly issued shares of common stock of the Company subject to certain conditions and limitations contained in the Equity Line Purchase Agreement, including that the Company may issue no more than the number of shares equal to 19.99% of the aggregate number of issued and outstanding shares of common stock of the Company as of immediately prior to the execution of the Equity Line Purchase Agreement without first obtaining stockholder approval. As of June 30, 2025, sales under the Equity Line Purchase Agreement had not yet commenced. Included in the conditions is a price payable (the “Equity Line Obligation liability”) by the Company to the Equity Line Investor if the Company sells shares to the Equity Line Investor. The Equity Line Obligation liability does not have a material impact on existing sources of liquidity. See further discussion in Note 3 - Summary of Significant Accounting Policies.

The Company’s primary sources of liquidity have been cash contributions from founders or equity capital raised from other investors. As of June 30, 2025, the Company had retained earnings of $215.9 million and $29.5 million of working capital including $30.5 million in cash, cash equivalents and restricted cash. The Company had restricted cash of approximately $30,633, which is included in cash, cash equivalents and restricted cash in the condensed consolidated balance sheets and represents cash deposited by the Company into a separate account and designated as collateral for a standby letter of credit in the same amount in accordance with a contractual agreement.

The Company assesses its liquidity in terms of its ability to generate adequate amounts of cash to meet current and future needs. Its expected primary uses of cash on a short and long-term basis are for working capital requirements, capital expenditures, capital contributions to its joint ventures and other general corporate services. The Company’s primary working capital requirements are for project execution activities including purchases of materials, services and payroll which fluctuate during the year, driven primarily by the timing and extent of activities required for new and existing projects. The Company’s management expects that future operating losses and negative operating cash flows may increase from historical levels because of additional costs and expenses related to the development of the Company’s technology and the development of market and strategic relationships with other businesses and customers.

Future capital requirements will depend on many factors, including, the timing and extent of spending by the Company and its joint ventures to support the launch of their product and research and development efforts, the degree to which the Company is successful in launching new business initiatives and the cost associated with these initiatives, the timing and extent of contributions made to the Company’s joint ventures by the other partners and the growth of the Company’s business generally. In March 2024, the Company contributed $10.0 million in cash to the AirJoule JV. Pursuant to the A&R Joint Venture Agreement, the Company has agreed to make additional capital contributions to the AirJoule JV based on a business plan and annual operating budgets to be agreed between the Company and GE Vernova, and the Company’s remaining commitment for capital contributions to the AirJoule JV is $85.0 million as of June 30, 2025. In general, for the first six years, GE Vernova has the right, but not the obligation, to make capital contributions to the AirJoule JV. See Note 5 - Equity Method Investment for further information.

Capital Contribution

Pursuant to the A&R Joint Venture Agreement, the Company is expected to contribute additional capital to the AirJoule JV based on a business plan and annual operating budgets to be agreed between the Company and GE Vernova. During the six months ended June 30, 2025, the Company contributed an additional $10.0 million in capital contributions to the AirJoule JV.

In order to finance future opportunities and associated costs, it is possible that the Company would need to raise additional financing if the proceeds realized to date are insufficient to support its business needs. While management believes that the proceeds realized to

7

date will be sufficient to meet its currently contemplated business needs, there is no guarantee that this will be the case. If additional financing is required by the Company from outside sources, the Company may not be able to raise it on terms acceptable to it or at all. If the Company is unable to raise additional capital on acceptable terms when needed, its product development business, results of operations and financial condition would be materially and adversely affected.

Note 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in accordance with GAAP, expressed in U.S. dollars. References to GAAP issued by the Financial Accounting Standards Board (“FASB”) in these accompanying notes to the financial statements are to the FASB Accounting Standards Codification (“ASC”). The condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern.

Unaudited Interim Condensed Financial Statements

The accompanying unaudited condensed consolidated financial statements reflect all adjustments including normal recurring adjustments, which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows for the periods presented in accordance with GAAP. Operating results for interim periods presented are not necessarily indicative of the results that may be expected for the year ending December 31, 2025. The interim financial statements presented herein do not contain all required disclosures under GAAP for annual financial statements. The accompanying unaudited interim condensed financial statements should be read in conjunction with the annual audited financial statements and related notes in the Company's Annual Report on Form 10-K for the year ended December 31, 2024.

Principles of Consolidation

Our condensed consolidated financial statements include the accounts of AirJoule Technologies Corporation and its subsidiaries after elimination of all intercompany accounts and transactions. We consolidate all subsidiaries in which we have a controlling financial interest, which includes AirJoule Technologies LLC, a wholly owned subsidiary.

The Company owns a noncontrolling interest in an unconsolidated joint venture with GE Vernova, the AirJoule JV. The investment in the Company’s unconsolidated affiliate is accounted for using the equity method with the Company’s proportionate share of income or loss recognized within equity gain (loss) from investment in AirJoule JV in its condensed consolidated statements of operations. See further discussion of the Company’s unconsolidated affiliate in Note 5 - Equity Method Investment.

Segment Information

The Company’s chief operating decision maker (“CODM”) has been identified as the senior executive committee that includes the Chief Executive Officer and Chief Financial Officer. They review the operating results for the Company as a whole to make decisions about allocating resources and assessing financial performance. The measure of segment performance is based on consolidated net income as reported on the condensed consolidated statement of operations. The measure of segment assets is reported on the condensed consolidated balance sheets as total assets.

The CODM uses net income to monitor budget versus actual results, assess performance and how to allocate resources. The key measures of segment profit or loss reviewed by our CODM are general and administrative expenses, research and development expenses and interest earned on the Company’s interest-bearing accounts. General and administrative and research and development expenses are reviewed and monitored by the CODM to manage and forecast cash to ensure enough capital is available to meet current and future needs, which include working capital requirements, capital expenditures and other general corporate services. Primary working capital requirements are for project execution and development of the Company’s technology, which includes purchases of materials, services, payroll and development of market and strategic relationships with other businesses and customers. The CODM reviews interest earned to measure cash inflow and determine the most effective strategy of investment with the interest-bearing accounts while maintaining compliance with the Company’s investment policy. Additionally, the CODM reviews the Company’s investment in AirJoule, LLC for material changes, including potential impairment resulting from events or changes in circumstances indicating that a decline in value has occurred that is other than temporary.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of expenses during the reporting period.

8

Some of the more significant estimates include fair values of liabilities associated with the Earnout Shares, True Up Shares and Subject Vesting Shares (as such terms are defined in Note 4 - Recapitalization), fair value of the investment in the AirJoule JV and income taxes. Due to the uncertainty involved in making estimates, actual results could differ from those estimates, which could have a material effect on the financial condition and results of operations in future periods.

Cash, Cash Equivalents and Restricted Cash and Concentration of Credit Risk

The Company considers all highly liquid investments with a weighted average maturity of 90 days or less at the time of purchase to be cash equivalents. The carrying values of cash, cash equivalents and restricted cash approximate their fair values due to the short-term nature of these instruments. As of June 30, 2025 and December 31, 2024, there was $25.8 million and $20.4 million, respectively, held in money market funds. The Company maintains cash balances at financial institutions that may exceed the Federal Deposit Insurance Corporation’s insurance limits. The amounts over these insured limits as of June 30, 2025 and December 31, 2024 were $3.9 million and $6.9 million, respectively. The Company mitigates this concentration of credit risk by monitoring the creditworthiness of the financial institutions. No losses have been incurred to date on any deposits.

Deferred Offering Costs

The Company capitalizes certain legal, accounting, and other third-party fees that are directly associated with in-process equity financings as deferred offering costs until such financings are consummated. After consummation of the equity financing, these costs will be netted against gross proceeds.

Business Combinations

The Company evaluates whether acquired net assets should be accounted for as a business combination or an asset acquisition by first applying a screen test to determine whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If so, the transaction is accounted for as an asset acquisition. If not, the Company applies its judgment to determine whether the acquired net assets meet the definition of a business by considering if the set includes an acquired input, process and the ability to create outputs.

The Company accounts for business combinations using the acquisition method when it has obtained control. The Company measures goodwill as the fair value of the consideration transferred, including the fair value of any non-controlling interest recognized, less the net recognized amount of the identifiable assets acquired and liabilities combined, all measured at their fair value as of the acquisition date. Transaction costs, other than those associated with the issuance of debt or equity securities, that the Company incurs in connection with a business combination are expensed as incurred.

Any contingent consideration is measured at fair value at the acquisition date. A contingent consideration that does not meet all the criteria for equity classification is required to be recorded at its initial fair value at the acquisition date, and on each balance sheet date thereafter. Changes in the estimated fair value of liability-classified contingent considerations are recognized on the condensed consolidated statements of operations in the period of change.

Equity Method Investment

In accordance with ASC 323, Investments - Equity Method and Joint Ventures, investments in entities over which the Company does not have a controlling financial interest but has significant influence are accounted for using the equity method, with the Company’s share of earnings or losses reported in earnings or losses from equity method investments in the statements of operations. Under the equity method, the Company’s investments are initially measured and recognized using the cost accumulation model following the guidance in ASC 805-50-30, Initial Measurement of Asset Acquisitions. After initial recognition, the condensed consolidated financial statements include the Company’s share of undistributed earnings or losses, and impairment, if any, until the date on which significant influence ceases.

Warrants

The Company determines the accounting classification of warrants it issues as either liability or equity classified by first assessing whether the warrants meet the liability classification in accordance with ASC 480-10, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity (“ASC 480”), then in accordance with ASC 815-40, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock (“ASC 815”). In order for a warrant to be classified in stockholders’ equity (deficit), the warrant must be (i) indexed to the Company’s equity and (ii) meet the conditions for equity classification.

If a warrant does not meet the conditions for stockholders’ equity (deficit) classification, it is carried in the condensed consolidated balance sheets as a warrant liability measured at fair value, with subsequent changes in the fair value of the warrant recorded in other

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non-operating gains (losses) in the condensed consolidated statements of operations. If a warrant meets both conditions for equity classification, the warrant is initially recorded, at its relative fair value on the date of issuance, in stockholders’ equity (deficit) in the condensed consolidated balance sheets, and the amount initially recorded is not subsequently remeasured at fair value.

Income Taxes

Prior to the Business Combination on March 14, 2024, the Company was a limited liability company and treated as a partnership for income tax purposes. As a partnership, the Company was not directly liable for federal income taxes. As of the date of the Business Combination, the operations of the Company ceased to be taxed as a partnership resulting in a change in tax status for federal and state income tax purposes.

The Company follows the asset and liability method of accounting for income taxes under ASC 740, Income Taxes (“ASC 740”). Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that is included in the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. Management has evaluated the Company’s tax positions, including its previous status as a pass-through entity for federal and state tax purposes, and has determined that the Company has taken no uncertain tax positions that require adjustment to the condensed consolidated financial statements. The Company’s reserve related to uncertain tax positions was zero as of June 30, 2025 and December 31, 2024. There were no unrecognized tax benefits, and no amounts accrued for interest and penalties as of June 30, 2025 and December 31, 2024. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviations from its position.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. Among other provisions, the OBBBA made permanent extensions of certain provisions within the Tax Cuts and Jobs Act and allowance of immediate expensing of qualified research and development expenses. We are evaluating the future impact of the tax law changes on our financial statements.

Research and Development Cost

The Company accounts for research and development cost (“R&D”) in accordance with FASB ASC 730, Research and Development. R&D represents costs incurred in performing research aimed at the discovery of new knowledge and the advancement of techniques to bring significant improvements to products and processes. Costs incurred in developing a product include consulting, engineering, construction and costs incurred to build prototypes.

Fair Value of Financial Instruments

Fair value is the price that would be received to sell an asset, or the amount paid to transfer a liability in an orderly transaction between market participants at the measurement date. There is a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The Company classifies fair value balances based on the observability of those inputs. The three levels of the fair value hierarchy are as follows:

	Level 1 —	Inputs based on unadjusted quoted market prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
	Level 2 —	Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar instruments in markets that are not active or for which all significant inputs are observable or can be corroborated by observable market data.
	Level 3 —	Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The inputs are both unobservable for the asset and liability in the market and significant to the overall fair value measurement.

In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement. The Company establishes the fair value of its assets and liabilities using the price that

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would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and establishes a fair value hierarchy based on the inputs used to measure fair value. The recorded amounts of certain financial instruments, including accounts payable, accrued expenses, and other current liabilities approximate fair value due to their relatively short maturities. See Note 5 – Equity Method Investment for measurements of the Investment in AirJoule, LLC measured utilizing level 3 inputs as of March 4, 2024. See Note 11 – Fair Value Measurements for measurements of the Earnout Shares, True Up Shares and Subject Vesting Shares, measured utilizing level 3 inputs as of June 30, 2025 and December 31, 2024.

Earnout Shares Liability

In connection with the reverse recapitalization and pursuant to the Merger Agreement, eligible former Legacy Montana Equityholders (as defined below) are entitled to receive additional shares of Common Stock upon the Company achieving certain milestones. See Note 4 – Recapitalization. The settlement of the Earnout Shares to the Legacy Montana Equityholders depends on factors other than just the Company’s stock price. As such, management determined that the Earnout Shares should be classified as a liability and recognized at fair value at each reporting period with changes in fair value included in the condensed consolidated statements of operations.

The Company estimated fair value of the Earnout Shares with a Monte Carlo simulation using a distribution of potential outcomes for expected earnings before interest, taxes, depreciation and amortization (“EBITDA”) and stock price at expected commission dates, utilizing a correlation coefficient for EBITDA and stock price, and assuming $50.0 million of Annualized EBITDA per production line, with each of the production lines commissioned over a five-year period. EBITDA was discounted to the valuation date with a weighted average cost of capital estimate and forecasted to each estimated commission date. Earnout mechanics at each estimated commission date were assessed, and if the earnout thresholds were achieved, the future value of the Earnout Shares was discounted to the valuation date utilizing a risk-free rate commensurate with the overall term. The commission dates used reflected management’s best estimates regarding the time to complete full construction and achieve operational viability of a production line, including all permitting, regulatory approvals and necessary or useful inspections. The five-year period and overall settlement mechanics for the Earnout Shares represent contractual inputs. Management’s valuation of the Earnout Shares liability involves certain assumptions requiring significant judgment, and actual results may differ from assumed and estimated amounts.

The Company determined the Earnout Shares associated with employees are accounted for as compensation expense under FASB ASC Topic 718, Share-based Compensation (“ASC 718”). See “Share-Based Compensation” below.

Derivative Financial Instruments and Other Financial Instruments Carried at Fair Value

The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. The Company evaluates all of its financial instruments, including the True Up Shares issued in connection with the Subscription Agreement, the Subject Vesting Shares issued in connection with the Business Combination and the Equity Line Obligation liability, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and FASB ASC 815, Derivatives and Hedging (“ASC 815”). The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is reassessed at the end of each reporting period.

The True Up Shares issued under one of the Subscription Agreements do not qualify as equity under ASC 815; therefore, the True Up Shares are required to be classified as a liability and measured at fair value with subsequent changes in fair value recorded in the condensed consolidated statements of operations. The fair value of the derivative liability is discussed in Note 11 — Fair Value Measurements.

The Subject Vesting Shares liability was an assumed liability of XPDB. The Subject Vesting Shares vest and are no longer subject to forfeiture as described in Note 4 – Recapitalization. They do not meet the “fixed-for-fixed” criterion and thus are not considered indexed to the Company’s stock price. As such, management determined that the Subject Vesting Shares should be classified as a liability and recognized at fair value at each reporting period with changes in fair value included in the condensed consolidated statements of operations. The estimated fair value of the Subject Vesting Shares was determined utilizing a Monte Carlo simulation, with underlying forecast mathematics based on geometric Brownian motion in a risk-neutral framework. The Calculation of the value of the Subject Vesting Shares considered the $12.00 and $14.00 vesting conditions in addition to the vesting related to the milestones associated with the Earnout Shares. Management’s valuation of the Subject Vesting Shares liability involves certain assumptions requiring significant judgment and actual results may differ from assumed and estimated amounts. See Note 11 – Fair Value Measurements.

The Equity Line Obligation liability does not qualify as equity under ASC 815; therefore, the Equity Line Obligation liability is required to be classified as a liability and measured at fair value. The Company will measure the fair value of the Equity Line Obligation liability on a nonrecurring basis as expected changes in the liability will be immaterial to the condensed consolidated financial statements. The Company will recognize at fair value any shares purchased by the Equity Line Investor using the purchase

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price of the shares on the date of issuance while derecognizing the then-current fair value of the Equity Line Obligation liability and include the associated fair value gain or loss in the condensed consolidated statements of operations as other income (loss). See Note 11 — Fair Value Measurements for further discussion.

Share-Based Compensation

The Company accounts for share-based compensation arrangements granted to employees and non-employees in accordance with ASC 718, Share-based Compensation, by measuring the grant date fair value of each award and recognizing the resulting expense over the period during which the recipient is required to perform services in exchange for the award. Equity-based compensation expense is only recognized for awards subject to performance conditions if it is probable that the applicable performance conditions will be achieved. Once it is probable that the performance condition will be achieved, the Company recognizes stock-based compensation cost over the remaining requisite service period on a graded vesting basis, with a cumulative adjustment for the portion of the service period that occurred for the period prior to the performance condition becoming probable of achievement, if any. Stock-based compensation expense for equity awards that contain market vesting conditions is recognized over the requisite service period commencing on the grant date even if the market condition is not satisfied. The Company accounts for forfeitures when the forfeitures occur.

The Company estimates the fair value of stock option awards subject to only a service condition on the date of grant using the Black-Scholes valuation model. The Black-Scholes model requires the use of highly subjective and complex assumptions, including the stock option’s expected term, the price volatility of the underlying stock, the applicable risk-free interest rate and the expected dividend yield of the underlying common stock, as well as an estimate of the fair value of the common stock underlying the stock option. The grant date fair value of restricted stock units that contain service vesting conditions are estimated based on the fair value of the underlying stock on the grant date. For restricted stock units with market vesting conditions, the fair value is estimated using a Monte Carlo simulation model, which incorporates the likelihood of achieving the market condition.

The Company estimates the fair value of Earnout Shares awards to employees, which are considered compensatory awards and accounted for under ASC 718 using the Monte Carlo simulation model. The Monte Carlo simulation model was selected as the valuation methodology for the Earnout Shares due to the path-dependent nature of applicable triggering events. Under ASC 718, such Earnout Shares are measured at fair value as of the grant date and expense is recognized over the applicable time-based vesting period (the triggering event is a market condition and does not impact expense recognition). The Monte Carlo model requires the use of highly subjective and complex assumptions, estimates and judgments, including the current stock price, the volatility of the underlying stock, expected term the risk-free interest rate, the selection of comparable companies and the probability of possible future events. Changes in any or all of these estimates and assumptions or the relationships between those assumptions impact our valuations as of each valuation date and may have a material impact on the valuation of share-based compensation arrangements. An increase of 100-basis points in interest rates would not have a material impact on the Company’s share-based compensation. During the period from the date of the Business Combination through June 30, 2025, the Company did not record share-based compensation expense associated with these Earnout Shares as the performance conditions associated with these Earnout Shares were not deemed probable of achievement. Unrecognized share-based compensation expense for these Earnout Shares with a performance-based vesting condition that was not deemed probable occurring as of June 30, 2025 was $1.5 million which is expected to vest subject to the performance-based vesting condition being satisfied or deemed probable.

Net Income Per Share

Basic net income per share is computed by dividing the net income which is allocated based upon the proportionate amount of weighted average shares outstanding, by each class of stockholder’s stock outstanding during the period. Diluted net income per share is computed by giving effect to all potential shares of common stock, including warrants, stock options, Earnout Shares, True Up Shares, Subject Vesting Shares and restricted stock units (“RSUs”), to the extent dilutive. Stock options and warrants with exercise prices greater than the average market price of the Company’s common stock for the period are excluded from the calculation of diluted net income per share as their inclusion would be anti-dilutive. Additionally, RSUs that vest based on service conditions that have not been achieved as of the end of the period are not included in the computation of basic or diluted earnings per share. Finally, Earnout Shares, True Up Shares and Subject Vesting shares are not included in the calculation of dilutive net income per share if their conditions are not deemed satisfied for issuance as of the reported period. For the three and six months ended June 30, 2025, 21,557,596 warrants, 1,380,736 Subject Vesting Shares and 853,612 Earnout Shares were not included in the calculation of dilutive net income per share as they would be anti-dilutive. For the three and six months ended June 30, 2025, 1,059,559 and 410,708 RSUs, respectively, were not included in the calculation of dilutive net income per share as they would be anti-dilutive. For the three and six months ended June 30, 2024, Earnout Shares, Subject Vesting Shares, True Up Shares and RSUs were not included in the calculation of dilutive net income per share as they would be anti-dilutive.

For the three months ended June 30, 2025, dilutive shares included in the calculation of net income per share of common stock, utilizing the treasury stock method, were 882,300 shares of common stock issuable upon the exercise of stock options and 49,224

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shares of common stock issuable upon the vesting of RSUs. For the three months ended June 30, 2024, dilutive shares included in the calculation of net income per share of common stock, utilizing the treasury stock method, were 1,411,586 shares of common stock issuable upon the exercise of stock options and 386,601 shares of common stock issuable upon the exercise of warrants.

For the six months ended June 30, 2025, dilutive shares included in the calculation of net income per share of common stock, utilizing the treasury stock method, were 975,105 shares of common stock issuable upon the exercise of stock options and 95,534 shares of common stock issuable upon the vesting of RSUs. For the six months ended June 30, 2024, dilutive shares included in the calculation of net income per share of common stock, utilizing the treasury stock method, were 1,360,305 shares of common stock issuable upon the exercise of stock options and 277,001 shares of common stock issuable upon the exercise of warrants.

The net income per share of common stock presented in the condensed consolidated statements of operations is based on the following for the three and six months ended June 30, 2025 and 2024:

	Three Months Ended June 30,
	2025								2024
	Class A Common Stock				Class B Common Stock				Class A Common Stock				Class B Common Stock
Basic net income per share of common stock
Numerator:
Allocation of net income	$	2,513,213			$	—			$	12,253,141			$	1,176,754
Denominator:
Basic weighted average shares outstanding		59,247,717				—				49,560,529				4,759,642
Basic net income per share of common stock	$	0.04			$	—			$	0.25			$	0.25
Diluted net income per share of common stock
Numerator:
Allocation of net income	$	2,513,213			$	—			$	12,290,847			$	1,139,048
Denominator:
Diluted weighted average shares outstanding		60,179,241				—				51,358,716				4,759,642
Diluted net income per share of common stock	$	0.04			$	—			$	0.24			$	0.24

	Six Months Ended June 30,
	2025								2024
	Class A Common Stock				Class B Common Stock				Class A Common Stock				Class B Common Stock
Basic net income per share of common stock
Numerator:
Allocation of net income	$	17,391,871			$	—			$	175,697,852			$	19,287,335
Denominator:
Basic weighted average shares outstanding		57,656,530				—				43,357,928				4,759,642
Basic net income per share of common stock	$	0.30			$	—			$	4.05			$	4.05
Diluted net income per share of common stock
Numerator:
Allocation of net income	$	17,391,871			$	—			$	176,332,549			$	18,652,638
Denominator:
Diluted weighted average shares outstanding		58,727,169				—				44,995,234				4,759,642
Diluted net income per share of common stock	$	0.30			$	—			$	3.92			$	3.92

New Accounting Pronouncements

Recently Issued Accounting Standards

The Company is an emerging growth company, as defined in the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it (i)

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is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, these financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates.

In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, which clarifies that contractual sale restrictions are not considered in measuring fair value of equity securities and requires additional disclosures for equity securities subject to contractual sale restrictions. The standard is effective for the Company for fiscal years beginning after December 15, 2024. The Company adopted this standard, and it does not have a material impact on the Company’s condensed consolidated financial statements and related disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions. The standard will be effective for the Company for fiscal years beginning after December 15, 2025. Early adoption is permitted. The Company is currently evaluating the impact of this accounting standard update on its condensed consolidated financial statements and disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires disaggregated disclosure of income statement expenses for public business entities. The standard is effective for the Company for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of this accounting standard update on its condensed consolidated financial statements and disclosures.

In November 2024, the FASB issued ASU 2024-04, Debt (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments, which clarifies the requirements related to accounting for the settlement of a debt instrument as an induced conversion. The standard is effective for the Company for fiscal years beginning after December 15, 2025. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s condensed consolidated financial statements and related disclosures.

In May 2025, the FASB issued ASU 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity, which clarifies current guidance for determining the accounting acquirer for a transaction effected primarily by exchanging equity interests in which the legal acquiree is a variable interest entity (“VIE”) that meets the definition of a business. The amendments require that an entity consider the same factors that are currently required for determining which entity is the accounting acquirer in other acquisition transactions. The standard is effective for the Company for fiscal years beginning after December 15, 2026. Early adoption is permitted. The Company is currently evaluating the impact of this accounting standard update on its condensed consolidated financial statements and disclosures.

In May 2025, the FASB issued ASU 2025-04, Compensation - Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606): Clarifications to Share-Based Consideration Payable to a Customer, which is intended to reduce diversity in practice and improve the decision usefulness and operability of the guidance for share-based consideration payable to a customer in conjunction with selling goods or services. The standard is effective for the Company for fiscal years beginning after December 15, 2026. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s condensed consolidated financial statements and related disclosures.

Note 4 — RECAPITALIZATION

On June 5, 2023, XPDB and Merger Sub entered into the Merger Agreement with Legacy Montana. On March 14, 2024, pursuant to the Merger Agreement, Merger Sub merged with and into Legacy Montana, with Legacy Montana surviving the Merger as a wholly owned subsidiary of XPDB.

As part of the Business Combination, the holders of Legacy Montana equity securities (the “Legacy Montana Equityholders”) received consideration (the “Merger Consideration”). After giving effect to the conversion of all outstanding Legacy Montana preferred units into Legacy Montana Class B common units, which occurred prior to the effective time of the Merger, the Merger Consideration was paid (i) in the case of holders of Legacy Montana Class B common units and Legacy Montana Class C common units, in the form of newly issued shares of Class A common stock, with a $10.00 value ascribed to each such share and which entitles the holder thereof to one vote per share on all matters submitted to a vote of the holders of Class A common stock, whether voting separately as a class or otherwise, (ii) in the case of holders of Legacy Montana Class A common units, in the form of newly issued shares of Class B common stock, with a $10.00 value ascribed to each such share and which entitles the holder thereof to a number of votes per share such that the Legacy Montana Equityholders as of immediately prior to the Closing, immediately following the

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Closing, collectively owned shares representing at least 80% of the voting power of all classes of capital stock of the recapitalized company (the “Post-Combination Company”) entitled to vote on matters submitted to a vote of the stockholders of the Post-Combination Company, and (iii) in the case of holders of Legacy Montana options, each outstanding Legacy Montana option, whether vested or unvested, were converted into an option to purchase, upon the same terms and conditions as are in effect with respect to the corresponding Legacy Montana option immediately prior to the Closing, including with respect to vesting and termination-related provisions, a number of shares of Class A common stock (rounded down to the nearest whole share) equal to the product of (x) the number of Legacy Montana common units underlying such option immediately prior to the Closing and (y) the number of shares of Class A common stock issued in respect of each Legacy Montana common unit in the Business Combination pursuant to the Merger Agreement, at an exercise price per share (rounded up to the nearest whole cent) equal to (A) the exercise price per Legacy Montana common unit underlying such option immediately prior to the Closing divided by (B) the number of shares of Class A common stock issued in respect of each Legacy Montana common unit in the Business Combination pursuant to the Merger Agreement.

Immediately prior to the Closing, 100% of the total outstanding Legacy Montana Class A common units and 7% of the total outstanding Legacy Montana Class B common units (or an aggregate of approximately 18% of the total outstanding Legacy Montana Class A units and Legacy Montana Class B units) were held by unitholders that continue as directors, officers, employees or contractors of the Post-Combination Company. The retention of certain employees who continue as directors, officers or employees of the Post-Combination Company (whose responsibilities include continued technology development and commercial execution) is integral to the achievement of the milestones that will determine whether Earnout Shares are payable. Legacy Montana does not believe that such targets are achievable absent the continued involvement of such persons. In June and September 2024, the Company granted equity awards (pursuant to the terms of the Incentive Plan (as defined below)) to its directors, officers and certain employees of the Company and the AirJoule JV, and the Company expects to continue to provide competitive compensation, benefits and equity awards to key directors, officers and employees going forward in order to incentivize these individuals to continue to provide services to the Company.

The Legacy Montana Equityholders have the opportunity to receive additional equity consideration (in each case, in accordance with their respective pro rata share), and the Company has reserved shares of Class A common stock that may be issuable in the future upon full completion of construction and achievement of operational viability (including all permitting, regulatory approvals and necessary or useful inspections) of new production capacity of Legacy Montana’s key components. See Note 11 - Fair Value Measurements for additional information on the Earnout Shares.

Upon the Closing of the Business Combination, and following the conversion of the XPDB Class B common stock to Class A common stock, the sponsor of XPDB beneficially owned 6,827,969 shares of Class A common stock, of which (i) 5,447,233 shares automatically vested (and shall not be subject to forfeiture) at the Closing and (ii) 1,380,736 shares (the “Subject Vesting Shares”) shall be vested and no longer be subject to forfeiture as follows:

•During the vesting period, a portion of the Subject Vesting Shares shall vest, from time to time, simultaneously with any Earnout Shares, with the number of vesting shares calculated as (A) the aggregate number of Subject Vesting Shares outstanding immediately after the Closing multiplied by (B) the fraction of (x) the applicable Earnout Milestone Amount divided by (y) the Maximum Earnout Milestone Amount (as defined below); and

•(A) 690,368 shall vest at such time that the volume weighted average price of Class A common stock on the Nasdaq Capital Market (“Nasdaq”) as reported by Bloomberg L.P. equals or exceeds $12.00 per share (as adjusted for extraordinary transactions, stock splits, extraordinary stock dividends, reorganizations, recapitalizations and the like) for 20 trading days within any 30 consecutive trading day period during the vesting period; or (B) if, prior to the $12.00 vesting time, any Subject Vesting Shares have vested simultaneously with the Earnout Stock Payment, then (x) if the number of Subject Vesting Shares that have vested exceeds 690,368, then no additional Subject Vesting Shares shall vest and (y) if the number of Subject Vesting Shares that have vested is less than 690,368 (the “Deficit Amount”), then a number of Subject Vesting Shares equal to 690,368 less the Deficit Amount shall vest; and

•Any remaining Subject Vesting Shares shall vest in full at the same time that the volume weighted average price of Class A common stock on the Nasdaq as reported by Bloomberg L.P. equals or exceeds $14.00 per share (as adjusted for extraordinary transactions, stock splits, extraordinary stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30 consecutive trading day period.

On March 8, 2024, XPDB and an investor entered into a Subscription Agreement pursuant to which XPDB agreed to sell 588,235 shares of Class A common stock to the investor for an aggregate purchase price of approximately $5.0 million, contingent on the Closing of the Business Combination. The Subscription Agreement provides that, subject to certain conditions set forth therein, the Company may be required to issue to the investor up to an additional 840,336 shares of Class A common stock (the “True Up Shares”) if the trading price of the Class A common stock falls below the per share purchase price within one year of the Closing of the Business Combination. The True Up Shares are considered a variable-share obligation under ASC 480-10-25-14, and as a result were

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accounted for as a liability recognized at fair value at each reporting period with changes in fair value included in earnings. During the year ended December 31, 2024, the Company’s volume-weighted average price of the Class A common stock on the Nasdaq as reported by Bloomberg L.P. was less than $8.50 (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 15 consecutive trading days. As a result of this triggering event, the Company issued to the investor 275,880 shares of Class A common stock on March 18, 2025. The difference between the fair value of True Up Shares as reported on the triggering event date and the fair value calculated using the Company's stock price at close of business on the triggering event date was recognized as a gain in the condensed consolidated statements of operations. See Note 11 – Fair Value Measurements.

As discussed in Note 1 - Organization and Business Operations, the Business Combination was consummated on March 14, 2024, which, for accounting purposes, was treated as the equivalent of Legacy Montana issuing stock for the net assets of XPDB, accompanied by a recapitalization. Under this method of accounting, XPDB was treated as the acquired company for financial accounting and reporting purposes under US GAAP.

Transaction Proceeds

Upon closing of the Business Combination, the Company received gross proceeds of $7.5 million inclusive of $5.0 million from the PIPE investment, offset by total transaction costs and other fees totaling of $7.5 million. The following table reconciles the elements of the Business Combination to the condensed consolidated statements of cash flows and the condensed consolidated statement of changes in stockholders’ equity (deficit) for the six months ended June 30, 2024:

Cash-trust and cash, net of redemptions		$	2,455,361
Add: proceeds from PIPE investment			4,999,998
Less: transaction costs and advisory fees, paid			(7,455,359	)
Net proceeds from the Business Combination			—
Less: Subject Vesting Shares liability			(11,792,000	)
Less: True Up Shares liability			(555,000	)
Less: accounts payable and accrued liabilities combined			(9,054,854	)
Add: other, net			374,377
Reverse recapitalization, net		$	(21,027,477	)

The number of shares of Common Stock issued immediately following the consummation of the Business Combination were:

XPDB Class A common stock, outstanding prior to the Business Combination			10,608,178
Less: Redemption of XPDB Class A common stock			(10,381,983	)
Class A common stock of XPDB			226,195
XPDB Class B common stock, outstanding prior to the Business Combination			7,187,500
PIPE subscription			588,235
Business Combination Class A common stock			8,001,930
Legacy Montana Shares			45,821,482
Class A and B Common Stock immediately after the Business Combination			53,823,412

The number of Legacy Montana shares was determined as follows:

		Legacy Montana Units				The Company’s Shares after conversion ratio
Class A common stock			1,725,418				41,061,840
Class B common stock			200,000				4,759,642

Transaction Costs

During the six months ended June 30, 2024, based on the proceeds received, the Company expensed $54.7 million for transaction costs incurred in connection with the Business Combination, inclusive of the recognition of the earnout shares liability of $53.7 million, because the transaction costs exceeded the proceeds received in the Business Combination. See Note 11- Fair Value Measurements for further information on the recognition and measurement of the Earnout shares. The remaining transaction costs primarily represented fees incurred for financial advisory, legal and other professional services that were directly related to the Business Combination.

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Public and private placement warrants

The 14,375,000 Public Warrants issued at the time of XPDB’s initial public offering and 11,125,000 warrants issued in connection with private placement at the time of XPDB’s initial public offering (the “Private Placement Warrants”) remained outstanding and became warrants for the Company.

Redemption

Prior to the closing of the Business Combination, certain XPDB public shareholders exercised their right to redeem certain of their outstanding shares for cash, resulting in the redemption of 10,381,983 shares of XPDB Class A common stock for an aggregate payment of $112.7 million.

Note 5 — EQUITY METHOD INVESTMENT

AirJoule, LLC

On January 25, 2024, Legacy Montana entered into a Framework Agreement with GE Vernova, a Delaware limited liability company, and, solely for the purposes specified therein, GE Vernova LLC, a Delaware limited liability company (“GE Vernova Parent”), pursuant to which Legacy Montana and GE Vernova agreed, subject to the terms and conditions of the Framework Agreement, including certain closing conditions specified therein, to form a joint venture in which each of Legacy Montana and GE Vernova will hold a 50% interest. The purpose of the AirJoule JV is to incorporate GE Vernova’s proprietary sorbent materials into systems that utilize the Company’s AirJoule water capture technology and to manufacture and bring products incorporating the combined technologies to market in the Americas, Africa and Australia.

Upon the closing of the transaction on March 4, 2024, (the “JV Closing”), each party to the agreement entered into (i) an amended and restated limited liability company agreement of the AirJoule JV (the “A&R Joint Venture Agreement”), pursuant to which, among other things, the AirJoule JV has the exclusive right to manufacture and supply products incorporating the combined technologies to leading original equipment manufacturers and customers in the Americas, Africa and Australia, (ii) master services agreements, pursuant to which, among other things, each party to the agreement agree to provide certain agreed services to the AirJoule JV for a period of at least two years following the JV Closing (unless earlier terminated by the parties thereto) and (iii) an intellectual property agreement, pursuant to which, among other things, each of the Company and GE Vernova Parent license certain intellectual property to the AirJoule JV.

Pursuant to the A&R Joint Venture Agreement, the Company contributed $10.0 million in cash to the AirJoule JV at the JV Closing and in June 2024, GE Vernova contributed $100 to the AirJoule JV. Pursuant to the A&R Joint Venture Agreement, the Company has agreed to make additional capital contributions to the AirJoule JV based on a business plan and annual operating budgets to be agreed between the Company and GE Vernova, and the Company’s remaining commitment for capital contributions to the AirJoule JV is $85.0 million as of June 30, 2025. In general, for the first six years, GE Vernova has the right, but not the obligation, to make capital contributions to the AirJoule JV. Until GE Vernova elects to participate and contributes its pro-rata share of all past capital contributions and commits to contribute its pro-rata share for all future capital contributions, the Company shall be solely responsible for funding the AirJoule JV, and the Company shall have a distribution preference under the A&R Joint Venture Agreement for the amount of its post-closing capital contributions plus a 9.50% preferred return on such amounts.

The business and affairs of the A&R Joint Venture Agreement shall be managed by a Board of Managers, consisting of two managers (including the chairman) appointed by the Company and two managers appointed by GE Vernova. Following the second anniversary of the JV Closing, if the Board of Managers reach an impasse that cannot be resolved through the process set forth in the A&R Joint Venture Agreement, the A&R Joint Venture Agreement generally provides that the Company may require GE Vernova to sell GE Vernova’s 50% interest to the Company or GE Vernova may require the Company to purchase GE Vernova’s 50% interest, but only, in each case, if the GE Match Date has not yet occurred. The price for GE Vernova’s interest will depend on the fair market value of the interest, as set forth in the A&R Joint Venture Agreement, with a minimum value of approximately $5 million. The A&R Joint Venture Agreement also provides similar call and put rights with respect to GE Vernova’s interest if the GE Match Date does not occur by the sixth anniversary of the JV Closing or if the Company is acquired by a competitor of GE Vernova.

In the event that a change in applicable laws or regulations has a material adverse effect on GE Vernova’s interest in the AirJoule JV, or GE Vernova determines that the Company fails to meet certain financial performance benchmarks, GE Vernova may require the Company to purchase GE Vernova’s interest for a total purchase price of $1.00.

AirJoule, LLC is a variable interest entity for which the Company has determined there is shared power with GE Vernova and therefore accounts for the VIE under the equity method of accounting. The Company considered the power to direct significant activities and obligation to absorb losses or right to receive benefits in assessing whether or not the VIE should be accounting for

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under the equity method of accounting. Certain assumptions the Company used to reach its conclusion included the lack of reconsideration events, the assessment of decision-making rights based on contractual agreements and expected financial exposure.

The Company applies the equity method to an investment in common stock of an unconsolidated entity. In addition to $10.0 million in cash the Company contributed to the AirJoule JV at the JV Closing, the Company contributed a perpetual license in its intellectual property with a carrying value of zero in exchange for its investment in AirJoule, LLC. In applying the equity method, the Company’s investment was initially recorded at fair value in the condensed consolidated balance sheet. As it relates to the contributed perpetual license, the Company followed the guidance in ASC 610-20, Sale or Transfer of Non-financial Assets, which states the transfer of a license of IP that is not part of the entity’s ordinary activities, the entity should apply the licensing guidance in ASC 606, Revenue from Contracts with Customers, by analogy when evaluating the recognition and measurement of consideration received in exchange for transferring the rights to the IP and record this as other income in the statements of operations. As such the Company recognized a gain of $333.5 million for the six months ended June 30, 2024 (and treated as a temporary item for tax purposes resulting in a deferred tax liability of approximately $87.8 million) as presented in the accompanying condensed consolidated statements of operations.

The Company evaluated whether there was a basis difference between the carrying value and fair value of the Company’s proportionate share of the investee’s underlying net assets. AirJoule, LLC has elected to early adopt ASU 2023-05, Business Combinations – Joint Venture Formations (Subtopic 805-60), and, as a result measured the contributed assets at fair value. AirJoule, LLC was deemed a business as defined in ASC 805, Business Combinations, and, as such there is a basis difference of $266.0 million between the Company’s investment and the amount recorded in member’s capital by the investee, AirJoule, LLC, related to in-process R&D and goodwill which as of June 30, 2025 have indefinite lives.

The Company determined the fair value of the IP license by applying the multi-period excess earnings method. The excess earnings valuation method estimates the value of the IP license equal to the present value of the incremental after-tax cash flows attributable to that IP license over its remaining economic life. Some of the more significant assumptions utilized in our asset valuations included projected revenues, probability of commercial success, and the discount rate. The fair value using the excess earnings valuation method was determined using an estimated weighted average cost of capital of 12.5%, which reflects the risks inherent in future cash flow projections and represents a rate of return that a market participant would expect for this asset. This fair value measurement was based on significant inputs not observable in the market and thus represent Level 3 fair value measurement.

The Company’s share of the income (loss) reported by AirJoule, LLC are recorded as an equity gain (loss) from investment in AirJoule, LLC in the accompanying condensed consolidated statements of operations.

The following table contains balance sheet information of AirJoule, LLC as of June 30, 2025 and December 31, 2024:

		As of June 30, 2025				As of December 31, 2024
Total current assets		$	937,941			$	2,330,386
Total non-current assets			1,215,117,801				1,214,849,941
Total assets		$	1,216,055,742			$	1,217,180,327
Total current liabilities		$	2,180,709			$	4,531,668
Total non-current liabilities			4,104,557				4,238,293
Total liabilities			6,285,266				8,769,961
Equity			1,209,770,476				1,208,410,366
Total liabilities and equity		$	1,216,055,742			$	1,217,180,327

AirJoule, LLC tests its intangible assets for impairment during the fourth quarter of each year, or whenever a change in events and circumstances (triggering event) occurs that indicates the fair value of intangible assets may be below their carrying values. The LLC did not record any impairment charges during the three and six months ended June 30, 2025 and 2024.

Given the uncertain economic times and AirJoule, LLC’s status as an early stage company with limited operating history and the uncertainties regarding AirJoule, LLC’s successful development and commercialization of its products, there can be no assurance that the estimates and assumptions made for purposes of its goodwill impairment testing in 2025 will prove to be accurate predictions of the future. If AirJoule, LLC’s assumptions, including timing of revenue generation and forecasted EBITDA, are not achieved, then AirJoule, LLC may be required to record goodwill impairment charges in future periods.

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The following table contains statement of operations information of AirJoule, LLC for the three months ended June 30, 2025 and 2024, the six months ended June 30, 2025 and for the period from March 4, 2024 (AirJoule JV inception) to June 30, 2024:

	Three Months Ended June 30,								Six Months Ended June 30,				For the period from March 4, 2024 to June 30, 2024
	2025				2024				2025				2024
Revenue	$	—			$	—			$	—			$	—
Expenses		(4,164,656	)			(1,233,772	)			(8,949,461	)			(1,298,625	)
Other income		93,516				72,195				309,571				84,285
Net loss	$	(4,071,140	)		$	(1,161,577	)		$	(8,639,890	)		$	(1,214,340	)

Note 6 — OTHER ACCRUED EXPENSES

The following table summarizes other accrued expenses:

		As of June 30, 2025				As of December 31, 2024
Accrued royalty		$	150,000			$	250,000
Accrued payroll			825,461				1,125,846
Professional services			729,268				205,790
Equity Line Obligation			286,819				—
Accrued other			205,658				138,682
Total other accrued expenses		$	2,197,206			$	1,720,318

Note 7 — LEASES

As discussed in Note 8 – Related Party Transactions, the Company had a property lease with a related party which terminated on March 14, 2024. Lease expenses under this lease were $0 and $6,000 for the three and six months ended June 30, 2024, respectively, and were included in general and administrative costs in the condensed consolidated statements of operations.

Lease expense for the company’s operating lease was $9,593 and $19,186, respectively for the three and six months ended June 30, 2025 and $9,593 and $12,791 for the three and six months ended June 30, 2024. As of June 30, 2025, the Company’s operating lease was $3,175 per month with a remaining term of 45 months and a discount rate of 4.69%. Lease expense is included in general and administrative costs on the accompanying condensed consolidated statements of operations. This lease includes a renewal option at the election of the Company to renew or extend the lease. This optional period has not been considered in the determination of the ROU assets or lease liability associated with this lease as the Company did not consider it reasonably certain it would exercise the option.

At June 30, 2025, approximate future minimum rental payments required under the lease agreement is as follows:

		Operating Lease
Remainder of 2025		$	19,050
2026			39,370
2027			40,945
2028			42,583
2029			10,715
Total undiscounted lease payments			152,663
Less: effects of discounting			(12,664	)
Operating Lease Liability		$	139,999
Classified as:
Operating lease liability, current		$	32,886
Operating lease liability, non-current		$	107,113

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Note 8 — RELATED PARTY TRANSACTIONS

Lease Agreement

The Company had a property lease agreement with the Chief Executive Officer as discussed in Note 7 – Leases. The lease agreement was terminated upon close of the Business Combination on March 14, 2024. As of June 30, 2025 and December 31, 2024, $0 were owed under this agreement.

Consultancy Agreement

On January 1, 2019, the Company entered into a consultancy agreement with a company affiliated with the Chief Executive Officer for a monthly payment of $20,000 in exchange for the Chief Executive Officer providing services in connection with the development and sales of Company technologies and products. For the three and six months ended June 30, 2024, $20,000 and $80,000, respectively was included in general and administrative expenses on the condensed consolidated statement of operations. On May 1, 2024, this consultancy agreement was terminated. As of June 30, 2025 and December 31, 2024, $0 was owed under this agreement.

Office Services Agreement

On October 31, 2020, the Company entered into a consultancy agreement with an affiliate for a monthly payment of $5,000 to provide office services. For the three and six months ended June 30, 2024, $5,000 and $30,000, respectively was included in research and development expenses on the condensed consolidated statement of operations. On May 1, 2024, this office services agreement was terminated. As of June 30, 2025 and December 31, 2024, $0 was owed under this agreement.

Due to Related Party

Commencing on December 9, 2021, through the consummation of the initial Business Combination, XPDB agreed to pay affiliates of the sponsor a total of $20,000 per month for office space, administrative and support services. Upon the close of the Business combination, the Company assumed $540,000 related to this agreement. The balance was repaid in May 2024.

In 2023, the sponsor contributed $900,000 to the XPDB trust account in connection with extending the XPDB’s termination date pursuant to the approval of the extension amendment proposal. Upon the closing of the Business Combination, the Company assumed this balance and it was subsequently repaid in May 2024.

Due from Related Party

In November 2024, Legacy Montana executed a statement of work with AirJoule, LLC. Reimbursement of costs incurred during the three months ended June 30, 2025 was $0.4 million and $0.1 million of general and administrative and research and development expenses, respectively. Reimbursement of costs incurred during the six months ended June 30, 2025 was $0.8 million and $0.3 million of general and administrative and research and development expenses, respectively.

Related Party Equity Transactions

As described in Note 9 – Stockholders’ Equity, Legacy Montana sold equity interests that subsequently converted into shares of Class A common stock, to TEP Montana, LLC (“TEP Montana”). The Executive Chairman of the Company is the managing partner of the managing member of TEP Montana.

The Company granted awards to the employees of AirJoule, LLC during the six months ended June 30, 2025. The number of awards granted to the employees of AirJoule, LLC are found in Note 10 – Share-Based Compensation.

Note 9 — STOCKHOLDERS’ EQUITY

Warrants

In January, February and March 2024, 14 warrant holders of Legacy Montana exercised their warrants to purchase a total of 380,771 shares of Class A common stock, as converted, for a total purchase price of $45,760.

As part of XPDB’s initial public offering (“IPO”), XPDB issued 14,375,000 warrants to 37 investors where each whole warrant entitles the holder to purchase one share of the Company’s Class A common stock at an exercise price of $11.50 per share (the “Public Warrants”). Simultaneously with the closing of the IPO, XPDB completed the private sale of 11,125,000 warrants where each warrant allows the holder to purchase one share of the Company’s Class A common stock at $11.50 per share. In June 2024, 10 third-party

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investors exercised their Public Warrants on a cashless basis for a total of 705,758 Class A shares of the Company. In August 2024, 2,225,000 Private Placement warrants were transferred.

As of June 30, 2025, there are 12,657,596 Public Warrants and 8,900,000 Private Placement warrants outstanding.

The Private Placement Warrants (including the common stock issuable upon exercise of the Private Placement Warrants) were not transferable, assignable or saleable until 30 days after the consummation of the Business Combination (except, among other limited exceptions, to the Company’s officers and directors and other persons or entities affiliated with the XPDB’s sponsor and anchor investors) and they will not be redeemable by the Company. The Private Placement Warrants have terms and provisions that are identical to those of the Public Warrants, including as to exercise price, exercisability and exercise period, except that the Private Placement Warrants are exercisable on a cashless basis and are non-redeemable.

If holders of the Private Placement Warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering their warrants for that number of shares of the Company’s common stock equal to the quotient obtained by dividing (x) the product of the number of shares of the Company’s common stock underlying the warrants multiplied by the excess of the 10 day average closing price (defined below) as of the date prior to the date on which notice of exercise is sent or given to the warrant agent, less the warrant exercise price by (y) the 10 day average closing price. The 10 day average closing price means, as of any date, the average last reported sale price (defined below) of the shares of the Company’s common stock as reported during the 10 trading day period ending on the trading day prior to such date. Last reported sale price means the last reported sale price of the Company’s common stock on the date on which the notice of exercise of the warrant is sent to the warrant agent.

These Public Warrants expire on the fifth anniversary of the Business Combination or earlier upon redemption or liquidation and are exercisable commencing 30 days after the Business Combination, provided that the Company has an effective registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or the Company permits holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement) and registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder.

Once the Public Warrants become exercisable, the Company may redeem the outstanding Public Warrants:

•in whole and not in part;

•at a price of $0.01 per warrant;

•upon a minimum 30 days’ prior written notice of redemption to each warrant holder; and

•if, and only if, the reported last reported sale price of the Class A common stock for any 20 trading days within a 30-trading day prior to the date on which the Company sends the notice of redemption to the warrant holders equals or exceeds $18.00 per share (as adjusted).

The Company accounts for the warrants issued in connection with the IPO in accordance with the guidance contained in ASC 815. Such guidance provides that the warrants described above are not precluded from equity classification. Equity-classified contracts are initially measured at fair value (or allocated value). Subsequent changes in fair value are not recognized as long as the contracts continue to be classified in equity.

Subscription Agreements

During the year ended December 31, 2024, the Company entered into subscription agreements with various investors (the “Subscription Agreements”), which brought in approximately $61.8 million in gross proceeds. The Company issued and sold 5,807,647 shares of the Class A common stock to investors upon the Closing in exchange for equity interests issued by Legacy Montana pursuant to Subscription Agreements entered into by Legacy Montana with such investors in the first quarter of 2024, which resulted in gross proceeds of approximately $49.4 million, comprised of approximately $43.4 million received in the first quarter of 2024 and approximately $6.0 million in the second quarter of 2024. Of this total, TEP Montana purchased an aggregate of 5,116,176 shares in exchange for approximately $43.5 million pursuant to Subscription Agreements between Legacy Montana and TEP Montana. During the second quarter of 2024, the Company issued and sold an additional 1,238,500 shares of Class A common stock to investors pursuant to Subscription Agreements executed in the second quarter, which resulted in additional gross proceeds of approximately $12.4 million.

During the three months ended June 30, 2025, the Company entered into the April 2025 PIPE Subscription Agreements with the April 2025 PIPE Investors, pursuant to which, among other things, the April 2025 PIPE Investors agreed to subscribe for and purchase from

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the Company, and the Company agreed to issue and sell to the April 2025 PIPE Investors, an aggregate of 3,775,126 newly issued shares of Class A common stock at a purchase price of $3.98 per share on the terms and subject to the conditions set forth therein. The April 2025 PIPE Subscription Agreements entitled the April 2025 PIPE Investors to shelf registration rights with respect to the shares of Class A common stock they purchased. The transaction closed on April 25, 2025, and the shares of Class A common stock were issued and sold to the April 2025 PIPE Investors in reliance on Section 4(a)(2) of the Securities Act.

Equity Financing

Legacy Montana completed a preferred equity financing during February 2023 with TEP Montana, and issued 4,426 Series B Preferred Units in conjunction with this transaction. Upon close of the Business combination, these shares were converted to 105,331 Class A common stock of the Company.

Note 10 — SHARE-BASED COMPENSATION

Legacy Montana Options

On April 5, 2023, Legacy Montana granted 383,151 options, as converted, exercisable for Class A common stock to key team members of Legacy Montana. The options immediately vested, had an exercise price of $0.49, as converted, a term of seven years, and a grant date fair value of $0.14, as converted. The Company used the Black-Scholes option pricing model to estimate the fair value of stock options. Fair value was estimated at the date of grant.

In January, February and March 2024, 13 Legacy Montana option holders exercised their options to purchase a total of 2,141,839 shares of Class A common stock, as converted, for a total purchase price of $56,250. In June 2024, one Legacy Montana option holder exercised its options to purchase a total of 8,000 shares of Class A common stock, as converted, for a total purchase price of $3,920.

In September 2024, three Legacy Montana option holders exercised their options to purchase a total of 67,495 shares of Class A common stock, as converted, for a total purchase price of $33,073.

In the three months ended December 31, 2024, three Legacy Montana option holders exercised their options to purchase a total of 85,496 shares of Class A common stock, as converted, for a total purchase price of $37,453.

In the three months ended March 31, 2025, four Legacy Montana option holders exercised their options to purchase a total of 147,579 shares of Class A common stock, as converted, for a total purchase price of $41,759.

In the three months ended June 30, 2025, two Legacy Montana option holders exercised their options to purchase a total of 148,486 shares of Class A common stock, as converted, for a total purchase price of $57,958.

As of June 30, 2025, of the 878,022 Legacy Montana options that are outstanding, 535,955 options expire on December 7, 2030, 71,395 options expire on March 15, 2031, 60,672 options expire on April 4, 2030, and 210,000 options expire on April 8, 2031.

2024 Incentive Award Plan

On March 8, 2024, the holders of XPDB common stock considered and approved the Montana Technologies Corporation’s 2024 Incentive Award Plan (the “Incentive Plan”), which became effective immediately upon the Closing on March 14, 2024. Under the Incentive Plan, the Company may grant equity and equity-based awards to certain employees, consultants and non-employee directors award, such as, (a) Incentive Stock Options (granted to employees only), (b) Non-Qualified Stock Options (“NSOs”), (c) Stock Appreciation Rights, (d) Restricted Stock Units, (e) Restricted Stock, (f) dividend equivalents and (g) other stock and cash-based awards of the Company (“Incentive Awards”). The sum of any cash compensation, or other compensation, and the value (determined as of the grant date in accordance with ASC 718, or any successor thereto) of awards granted to a non-employee director as compensation for services as a non-employee director during any fiscal year of the Company may not exceed $500,000 (or, with respect to the first fiscal year of the Post-Combination Company during which a non-employee director first serves as a non-employee director, $1,000,000). As of June 30, 2025, there were 4,887,182 shares of common stock available for future issuance under the Incentive Plan.

2024 Employee Stock Purchase Plan

The 2024 Employee Stock Purchase Plan (the “2024 ESPP”) became effective immediately upon the Closing on March 14, 2024 and as of June 30, 2025, a total of 1,074,213 shares of common stock are reserved for issuance under the 2024 ESPP. Eligible employees may purchase shares of common stock under the 2024 ESPP at 85% of the lower of the fair market value of the Company’s common stock as of the first or the last day of each offering period. Employees are limited to contributing 15% of the employee’s eligible compensation and may not purchase more than $25,000 of stock during any calendar year or more than 12,000 shares during any one

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purchase period. The 2024 ESPP share reserve automatically increases on January 1st of each calendar year, for ten years, commencing on January 1, 2025, in an amount equal to 1% of the total number of shares of common stock outstanding on December 31st of the preceding calendar year. The Board may act prior to January 1st of a given year to provide that there will be no January 1st increase of the share reserve for such year or that the increase in the share reserve for such year will be a smaller number of shares of common stock than would otherwise occur pursuant to the preceding sentence. On January 1, 2025, the share reserve increased by 559,286. During the three and six months ended June 30, 2025 and 2024, the Company did not issue shares as the first purchase date had not yet occurred.

The Company recorded share-based compensation expense in the following expense categories of its accompanying unaudited condensed consolidated statements of operations during the three and six months ended June 30, 2025 and 2024.

		Three Months Ended June 30,						Six Months Ended June 30,
		2025			2024			2025			2024
General and administrative	$	1,405,671		$	146,959		$	2,370,303		$	146,959
Research and development		29,532			3,560			49,293			3,560
Total share-based compensation	$	1,435,203		$	150,519		$	2,419,596		$	150,519

Stock Options

The following table summarizes stock option activity for the six months ended June 30, 2025:

		Options				Weighted Average Exercise Price				Weighted Average Remaining Life (Years)
Balance at December 31, 2024			2,537,602		$		5.60				7.85
Granted			69,124				10.23
Exercised			(296,065	)			0.34
Forfeited			(11,850	)			10.23
Balance at June 30, 2025			2,298,811		$		6.38				7.62
Vested and expected to vest			1,420,789		$		10.23				8.93
Exercisable at the end of the period			1,307,867		$		3.46				6.62

There were 69,124 options granted during the three months ended June 30, 2025. As of June 30, 2025, the unrecognized compensation cost for options issued and then outstanding was $2.1 million and will be recognized over an estimated weighted-average amortization period of 2.93 years. The total intrinsic value of options exercised during the six months ended June 30, 2025 and 2024 was $1.7 million and $72,080, respectively. The aggregate intrinsic value of options outstanding and exercisable as of June 30, 2025 was $3.9 million.

Restricted Stock Units with Service-Only Conditions

The following table summarizes RSU with Service-Only Conditions activity for the six months ended June 30, 2025:

		Awards				Weighted Average Grant Date Fair Value
Balance at December 31, 2024			520,300		$		8.13
Granted			685,693				6.86
Released			(163,861	)			8.38
Forfeited			(60,574	)			4.04
Balance at June 30, 2025			981,558		$		7.45

The Company recognized $1.2 million and $0.1 million of stock-based compensation cost related to RSUs with Service-Only conditions for the six months ended June 30, 2025 and 2024, respectively. As of June 30, 2025, the unrecognized compensation cost for RSUs with service-only conditions was $6.7 million and will be recognized over an estimated weighted-average amortization period of 2.68 years. The fair values of RSUs with service-only conditions are based on the fair value of the Company’s common stock on the date of the grant. The 685,693 RSUs with service-only conditions that were granted during the six months ended June 30,

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2025 consisted of 384,014 awards granted to employees, 133,457 awards granted to non-employee equity method investees and 168,222 awards granted to non-employee directors. The awards granted to employees and to non-employee equity method investees vest as to 33.33% of the total awards granted on each of the first three anniversaries of the applicable vesting commencement date, subject to the applicable employee’s continued service through the applicable vesting date. The awards granted to non-employee directors vest as to 100% of the total awards granted on the earlier of the first year anniversary of the applicable vesting commencement date and the date of the next annual shareholders' meeting.

Restricted Stock Units with Market-Based Conditions

The following table summarizes RSU with Market-Based Conditions activity for the six months ended June 30, 2025:

		Awards				Weighted Average Grant Date Fair Value
Balance at December 31, 2024			—		$		—
Granted			496,483				10.09
Released			—				—
Forfeited			—				—
Balance at June 30, 2025			496,483		$		10.09

The Company recognized $0.7 million of stock-based compensation cost related to RSUs with Market-Based conditions for the six months ended June 30, 2025. As of June 30, 2025, the unrecognized compensation cost for RSUs with market-based conditions was $4.3 million and will be recognized over an estimated weighted-average amortization period of 2.50 years. The fair values of RSUs with market-based conditions are estimated using a Monte Carlo simulation model, which incorporates the likelihood of achieving the market condition. The 496,483 RSUs with market-based conditions that were granted during the six months ended June 30, 2025 consisted of 475,298 awards granted to employees and 21,185 awards granted to non-employee equity method investees. These awards vest subject to certain market conditions.

The Company records expense ratably over the requisite service period, with expense determined based on the grant date fair value regardless of whether the market condition is satisfied because the awards are subject to market conditions. These awards that remain subject to market conditions are reflected at the target level, which is consistent with how expense will be recorded, regardless of the numbers of shares that are expected to be earned. The grant date fair value of the awards granted is established using the Monte Carlo simulation model. The following summarizes the assumptions used to estimate the fair value of the RSUs with market-based conditions that were granted during the six months ended June 30, 2025:

RSUs - Market-Based Conditions
Expected term - years			2.9
Expected volatility			89.7	%
Risk-free interest rate			4.3	%
Expected dividends			—

Restricted Stock Units with Performance-Based Conditions

The following table summarizes RSU with Performance-Based Conditions activity for the six months ended June 30, 2025:

		Awards				Weighted Average Grant Date Fair Value
Balance at December 31, 2024			—		$		—
Granted			201,279				8.18
Released			—				—
Forfeited			—				—
Balance at June 30, 2025			201,279		$		8.18

These awards vest subject to certain performance-based conditions. The Company recognized $0.1 million of stock-based compensation cost related to RSUs with Performance-Based conditions for the six months ended June 30, 2025.

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Note 11 — FAIR VALUE MEASUREMENTS

Items Measured at Fair Value on a Recurring Basis:

The Company accounts for certain liabilities at fair value on a recurring basis and classifies these liabilities within the fair value hierarchy (Level 1, Level 2, or Level 3). Assumptions such as risk-free rate, stock price, volatility and discount rate were based on market data. Management used a single point estimate for the risk-free rate, volatility and discount rate.

Liabilities subject to fair value measurements that are valued on a recurring basis are as follows:

		As of June 30, 2025
		Level 1				Level 2				Level 3				Total
Liabilities
Earnout Shares liability		$	—			$	—			$	5,416,000			$	5,416,000
Subject Vesting Shares liability			—				—				1,411,000				1,411,000
Total liabilities		$	—			$	—			$	6,827,000			$	6,827,000

Earnout Shares

The Legacy Montana Equityholders have the opportunity to receive additional equity consideration (in each case, in accordance with their respective pro rata share) through the Earnout Shares. The maximum value of the Earnout Shares is capped at $200.0 million (“Maximum Earnout Milestone Amount”), and the ability to receive Earnout Shares expires on the fifth anniversary of the Closing. A majority of the independent members of the Post-Combination Company Board then serving has sole discretion in determining, among other things, the achievement of the applicable milestones, the calculations of payments of Earnout Shares to the applicable Legacy Montana Equityholders, the dates on which construction and operational viability of new production capacity is deemed completed and whether to consent to a transfer of the applicable Legacy Montana Equityholder’s right to receive Earnout Shares. Earnout Shares issuable in respect of Legacy Montana options outstanding as of immediately prior to the effective time of the Merger may be issued to the holder of such Legacy Montana option only if such holder continues to provide services (whether as an employee, director or individual independent contractor) to the Post-Combination Company or one of its subsidiaries through the date on which such Earnout Shares are issued, as determined by a majority of the independent members of the Post-Combination Company Board.

If the conditions for payment of the Earnout Shares are satisfied and assuming all originally designated employees are then still providing services to the Post-Combination Company on the date such condition is met, approximately 21% of the aggregate Earnout Shares will be payable to the employees and 79% of the aggregate Earnout Shares will be payable to the holders of Legacy Montana common units, in accordance with their respective pro rata share immediately following the Closing.

The settlement of the Earnout Shares to the holders of Legacy Montana common units contains variations in something other than the fair value of the issuer’s equity shares. As such, management determined that they should be classified as a liability and recognized at fair value at each reporting period with changes in fair value included in earnings. The Earnout Shares are subject to ASC 718 and are accounted for as post-combination compensation cost.

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The estimated fair value of the Earnout Shares was determined with a Monte Carlo simulation using a distribution of potential outcomes for expected EBITDA and stock price at expected commission dates, utilizing a correlation coefficient for EBITDA and stock price, and assuming $50.0 million of Annualized EBITDA per production line, with each of the production lines commissioned over a five-year period. EBITDA was discounted to the valuation date with a weighted average cost of capital estimate and forecasted to each estimated commission date. Earnout mechanics at each estimated commission date were assessed, and if the Earnout Thresholds were achieved, the future value of the Earnout Shares was discounted to the valuation date utilizing a risk-free rate commensurate with the overall term. The commission dates used reflected XPDB’s management’s best estimates regarding the time to complete full construction and operational viability of a production line, including all permitting, regulatory approvals and necessary or useful inspections. The Earnout term of 5 years and the Earnout mechanics which impact the timing of expected future cash flows represent contractual inputs. See the following summary of key inputs:

		As of June 30, 2025				As of December 31, 2024
Stock Price		$	4.63			$	7.97
Volatility			38	%			40	%
Risk free rate of return			3.70	%			4.30	%
Discount rate			25	%			25	%
Expected term (in years)			3.7				4.2

The following table presents the changes in the fair value of the Earnout Shares liability:

		Six Months Ended June 30, 2025
Earnout Shares liability as of December 31, 2024		$	24,524,000
Change in fair value			(12,832,000	)
Balance as of March 31, 2025			11,692,000
Change in fair value			(6,276,000	)
Balance as of June 30, 2025		$	5,416,000

As of June 30, 2025 and December 31, 2024, the estimated fair value of all the Earnout Shares, $5.4 million and $24.5 million, respectively represents approximately 853,612 and 2,115,227 Earnout Shares, respectively. The Earnout Shares liability in the preceding table represents the fair value of the contingent obligation to issue Earnout Shares to Legacy Montana Equityholders (excluding the shares to employees accounted for under ASC 718) upon the achievement of certain Earnout Milestones. For the six months ended June 30, 2025, the change in the fair value of the earnout liability primarily relates to a decrease in stock price, changes in the timing of expected future cash flows and an increase in the volatility.

True Up Shares liability

As discussed in Note 4 - Recapitalization, on March 8, 2024, XPDB and an investor entered into a Subscription Agreement pursuant to which XPDB agreed to sell 588,235 shares of Class A common stock to the investor for an aggregate purchase price of approximately $5.0 million, contingent on the Closing of the Business Combination. The Subscription Agreement provides that, subject to certain conditions set forth therein, the Company may be required to issue to the investor up to an additional 840,336 shares of Class A common stock if the trading price of the Class A common stock falls below the per share purchase price within one year of the Closing of the Business Combination. During the year ended December 31, 2024, the Company’s volume-weighted average price of the Class A common stock on the Nasdaq as reported by Bloomberg L.P. was less than $8.50 (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 15 consecutive trading days. As a result of this triggering event, the Company issued to the investor 275,880 shares of Class A common stock on March 18, 2025. The difference between the fair value of True Up Shares as reported on the triggering event date and the fair value calculated using the Company's stock price at close of business on the triggering event date was recognized as a gain in the condensed consolidated statements of operations. Prior to the triggering event, the True Up Shares were accounted for as a liability recognized at fair value at each reporting period with changes in fair value included in earnings.

The estimated fair value of the true up share liability was determined utilizing a Monte Carlo simulation, with underlying forecast mathematics based on geometric Brownian motion in a risk-neutral framework. The Calculation of the value of the True Up Shares considered the 15-day average price over the one-year period following the Closing Date.

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Subject Vesting Shares liability

In connection with the execution of the Merger Agreement and pursuant to the terms of the sponsor support agreement (the “Sponsor Support Agreement”) entered into among the XPDB sponsor (the “Sponsor”), XPDB, Legacy Montana and other holders of XPDB’s Class B common stock, $0.0001 par value per share (the “XPDB Class B common stock”), the Sponsor and the other holders of XPDB Class B common stock agreed to, among other things, (i) vote any XPDB Class A common stock, $0.0001 par value per share (the “Class A common stock”), of XPDB or XPDB Class B common stock (collectively, the “Sponsor Securities”), held of record or thereafter acquired in favor of the proposals presented by XPDB at a special meeting to approve the proposed Business Combination, (ii) be bound by certain other covenants and agreements related to the proposed Business Combination, (iii) be bound by certain transfer restrictions with respect to the Sponsor Securities and (iv) waive certain antidilution protections with respect to the Sponsor Securities, in each case, on the terms and subject to the conditions set forth in the Sponsor Support Agreement.

In addition, pursuant to the terms of the Sponsor Support Agreement, the Sponsor (i) agreed to waive its redemption rights with respect to any Sponsor Securities in connection with the completion of a Business Combination (which waiver was provided in connection with the IPO and without any separate consideration paid in connection with providing such waiver), (ii) agreed not to transfer any public shares and founder shares held by it during the time prior to Closing or the termination of the Merger Agreement, (iii) agreed to waive anti-dilution protections and (iv) and agreed to subject certain of the shares of Combined Company Class A common stock held by Sponsor following the conversion of the founder shares as of the Closing to certain vesting provisions. Specifically, and as described above in Note 4 – Recapitalization, the Sponsor Support Agreement provides that as of immediately prior to (but subject to) the Closing, the Subject Vesting Shares will be subject to an earnout, with the Subject Vesting Shares vesting during the period beginning on the date of Closing and ending five (5) years following the date of Closing (i) simultaneously with the issuance of the Earnout Shares made to the Legacy Montana Equityholders in a proportionate amount to the payment achieved in relation to the maximum issuance of Earnout Shares of equity interests of $200.0 million (the “Performance Vesting Trigger”) and (ii) up to 50% of the Subject Vesting Shares (including any vested Subject Vesting Shares from the Performance Vesting Trigger) vesting on any day following the Closing when the closing price of a share of Combined Company Class A common stock on the Nasdaq (the “Closing Share Price”) equals or exceeds $12.00 (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) and all remaining Subject Vesting Shares vesting when the Closing Share Price equals or exceeds $14.00 (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like).

The following table presents the changes in the fair value of the Subject Vesting Shares liability:

		Six Months Ended June 30, 2025
Earnout Shares liability as of December 31, 2024		$	7,819,000
Change in fair value			(5,474,000	)
Balance as of March 31, 2025			2,345,000
Change in fair value			(934,000	)
Balance as of June 30, 2025		$	1,411,000

The estimated fair value of the Subject Vesting Share liability was determined utilizing a Monte Carlo simulation, with underlying forecast mathematics based on geometric Brownian motion in a risk-neutral framework. The calculation of the value of the Subject Vesting Shares considered the $12.00 and $14.00 vesting conditions in addition to the vesting related to the Earnout Milestone Amount.

Items Measured at Fair Value on a Nonrecurring Basis

In addition to items that are measured at fair value on a recurring basis, the Company measures certain assets and liabilities at fair value on a nonrecurring basis, which are not included in the tables above. These assets and liabilities include our Investment in AirJoule, LLC and Equity Line Obligation liability, respectively. As these nonrecurring fair value measurements are generally determined using unobservable inputs, these fair value measurements are classified within Level 3 of the fair value hierarchy. For further information of our Investment in AirJoule, LLC see Note 5 – Equity Method Investment.

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Note 12 — COMMITMENTS AND CONTINGENCIES

The Company is involved in various legal matters arising in the normal course of business. In the opinion of the Company’s management and legal counsel, the amount of losses that may be sustained, if any, would not have a material effect on the financial position and results of operations of the Company.

Risks and Uncertainties

The Company, as an early-stage business without any current operations, product sales or revenue, has historically been dependent upon the sourcing of external capital to fund its overhead and product development costs. This is a typical situation for any early-stage company without product sales.

Royalties

In October 2021, the Company entered into a patent license agreement with a third party whereby the third party granted us rights to use certain of their patents in exchange for an upfront payment and royalties based on a percentage of net sales until such patents expire. In connection with this, the Company agreed to a minimum royalty amount of which $75,000 and $62,500 was expensed for the three months ended June 30, 2025 and 2024, respectively and $150,000 and $125,000 for the six months ended June 30, 2025 and 2024. At June 30, 2025 and December 31, 2024, $150,000 and $250,000, respectively, was accrued in the accompanying condensed consolidated balance sheets.

Joint Venture Agreement

On October 27, 2021, Legacy Montana entered into a joint venture with CATL US Inc. (“CATL US”), an affiliate of CATL, pursuant to which we and CATL US formed CAMT Climate Solutions Ltd., a limited liability company organized under the laws of Hong Kong (“CAMT”). Legacy Montana and CATL US both own 50% of CAMT’s issued and outstanding shares. Under the joint venture agreement, as revised, CAMT has the exclusive right to commercialize the AirJoule technology in Europe and Asia.

Pursuant to the Amended and Restated Joint Venture Agreement for CAMT, entered into on September 29, 2023, Legacy Montana and CATL US have each agreed to contribute $6.0 million to CAMT. Contributions will be requested by CAMT once a business plan and operating budget is set by CAMT’s Board of Directors. No action to establish a business plan or operating budget has occurred to date. Any additional financing beyond the initial $12.0 million (i.e., $6.0 million from each of Legacy Montana and CATL US) will be subject to the prior mutual agreement of Legacy Montana and CATL US. CAMT is managed by a four-member board of directors, with two directors (including the chairman) designated by CATL US and two directors (including the vice chairman) designated by Legacy Montana. In the event of an equal vote, the chairman may cast the deciding vote. Certain reserved matters, including debt issuances exceeding $5.0 million in a single transaction or in aggregate within a fiscal year, amendments to CAMT’s constitutional documents, the annual financial budget of CAMT and any transaction between CAMT and CATL US or Legacy Montana in an amount exceeding $10.0 million in a single transaction or in aggregate within a fiscal year, require the unanimous vote of both CATL US and Legacy Montana or all directors. As of June 30, 2025, no amount was funded to CAMT.

The purpose of Legacy Montana’s joint venture with CATL US is to commercialize the AirJoule technology in Asia and Europe and, pursuant to the Amended and Restated Joint Venture Agreement for CAMT, CAMT has the exclusive right to commercialize our AirJoule technology in those territories. Subject to the oversight of CAMT’s board, CATL US is responsible for managing the day-to-day operations of CAMT (including the nomination and replacement of the Chief Executive Officer of CAMT,) and is responsible for providing CAMT and any subsidiaries formed by CAMT with, among other things, administrative services, supply chain support, assistance in obtaining required permits and approvals and assistance in purchasing or leasing land and equipment. The Company’s financial statements do not reflect any accounting for CAMT as no assets (including IP) or cash have been contributed to CAMT and there has been no activity as of June 30, 2025.

Letter Agreement

On January 7, 2024, Legacy Montana entered into a letter agreement (the “Letter Agreement”) with XPDB and Carrier Corporation, an affiliate of Carrier Global Corporation (NYSE: CARR), a global leader in intelligent climate and energy solutions (collectively with its affiliates, “Carrier”), pursuant to which Carrier, XPDB and the Company agreed, among other things, to provide Carrier the right to nominate one (1) designee, subject to the approval of the Company, for election to the board of directors for so long as Carrier satisfies certain investment conditions, following the Business Combination. Pursuant to the terms of the agreement, Carrier has nominated its director.

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Note 13 — SEGMENT INFORMATION

The following table reconciles segment profit or loss to consolidated net income on the condensed consolidated statements of operations:

		Three Months Ended June 30,								Six Months Ended June 30,
		2025				2024				2025				2024
Interest income	$		283,733		$		216,480		$		526,758		$		242,626
Gain on contribution to AirJoule, LLC			—				—				—				333,500,000
Net change in fair value of liabilities			7,210,000				14,687,000				25,622,106				4,859,000
Other income			—				2,207,445				—				2,207,445
Less:
General and administrative			3,751,211				3,211,205				6,537,695				4,024,444
Research and development			401,623				1,050,804				789,542				1,896,961
Transaction costs incurred in connection with business combination			—				—				—				54,693,103
Income tax expense (benefit)			(1,558,882	)			(1,237,824	)			(3,201,539	)			84,487,339
Other segment items (1)			2,386,568				656,845				4,631,295				722,037
Segment net income	$		2,513,213		$		13,429,895		$		17,391,871		$		194,985,187

(1)Other segment items included in segment net income include sales and marketing, depreciation and amortization expense, change in fair value of the Equity Line Obligation liability and equity loss from investment in AirJoule, LLC

The following table reconciles segment assets to consolidated assets on the condensed consolidated balance sheets:

		June 30,				December 31,
		2025				2024
Investment in AirJoule, LLC	$		343,858,688		$		338,178,633
Other segment assets (1)			32,226,205				31,673,487
Segment assets			376,084,893				369,852,120
Adjustments and reconciling items			—				—
Consolidated assets	$		376,084,893		$		369,852,120

(1)Other segment assets included cash, cash equivalents and restricted cash, due from related party, prepaid expenses, operating lease right-of-use asset, and property and equipment, net

Note 14 — SUBSEQUENT EVENTS

Capital Contribution

On April 25, 2025, the Company entered into the Second Amended and Restated Limited Liability Company Agreement of AirJoule, LLC (the “Amended LLC Agreement”), by and among the Company, GE Vernova and AirJoule, LLC. Pursuant to the Amended LLC Agreement, the Company is expected to contribute additional capital to the AirJoule JV based on a business plan and annual operating budgets to be agreed between the Company and GE Vernova. In July 2025, the Company contributed an additional $2.75 million in capital contributions to the AirJoule JV.

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ITEM 2. 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 our unaudited condensed consolidated financial statements and related notes appearing in this Quarterly Report on Form 10-Q, as well as the audited financial statements, notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2024.

This discussion includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue,” or the negative of such terms or other similar expressions. Such statements include, but are not limited to, possible business combinations and the financing thereof, and related matters, as well as all other statements other than statements of historical fact included herein. Factors that might cause or contribute to such a discrepancy include, but are not limited to: our status as an early stage company with limited operating history, which may make it difficult to evaluate the prospects for our future viability; our initial dependence on revenue generated from a single product; significant barriers we face to deploy our technology; the dependence of our commercialization strategy on our relationship with third parties; our history of losses; accuracy of assumptions underlying projections related to our equity method goodwill impairment testing; and other risks and uncertainties described in our other SEC filings.

Unless the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “we”, “us”, “our”, and the “Company” are intended to refer to (i) following the Business Combination (as defined below), the business and operations of AirJoule Technologies Corporation, formerly known as Montana Technologies Corporation and its consolidated subsidiaries, and (ii) prior to the Business Combination, AirJoule Technologies LLC, formerly known as Montana Technologies LLC, or Legacy Montana, and its consolidated subsidiaries.

Company Overview

We are an advanced technology company whose purpose is to free the world from its water and energy constraints by delivering groundbreaking sorption technologies. AirJoule is the leading technology platform that unleashes the power of water from air. AirJoule produces pure distilled water from air, and our proprietary AirJoule platform, at commercial scale, will mitigate water scarcity through distributed water generation for businesses and consumers around the world. Our products are especially valuable for industrial users, which generate significant amounts of waste heat that can be used to power our sorption technologies to produce low cost pure distilled water and dehumidified air – two key inputs for a variety of industrial activities, including data centers and advanced manufacturing. In HVAC applications, AirJoule is designed to reduce energy consumption, minimize or even eliminate the use of environmentally-harmful refrigerants, and generate material cost efficiencies for air conditioning systems. We are focused on commercialization and scaling manufacturing of our AirJoule products through our global collaborations, including with GE Vernova and Carrier, and we believe that deploying AirJoule units worldwide will serve our purpose of freeing the world of its water and energy constraints. We plan to manufacture initial AirJoule systems capable of producing more than 1,000 liters per day in 2025, which we intend to use for customer demonstrations, and we expect to scale capacities for commercial sales in 2026.

Growth Strategy and Outlook

We anticipate significant growth opportunities by offering AirJoule in global markets where demand for water, dehumidified air and cooling are highest. With our technology platform, we believe that we are uniquely positioned to provide curated solutions that satisfy our customers’ needs and expectations in fast-growing and water and energy-intensive industries, such as data centers and advanced manufacturing, along with military and HVAC applications. We estimate the combined total addressable market to be approximately $450 billion.

In the data center arena, we aim to address escalating energy and water efficiency challenges associated with increased computing density by using low-grade waste heat to produce pure distilled water and enabling data center operators to reduce their cooling costs and improve water sustainability. Similarly, in advanced manufacturing environments, where product quality and process precision hinge on consistent humidity and ultra-pure water, AirJoule can help customers with cost-effective dehumidification. The military sector presents a distinct opportunity, as AirJoule is able to operate in a variety of climate conditions to support troops in remote and water-scarce environments, ensuring mission readiness and resilience. In the HVAC space, where building owners and facility managers are under pressure to cut energy consumption and improve indoor air quality, AirJoule’s superior moisture removal capability will reduce power consumption and the use of refrigerants in air conditioning systems.

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To accelerate market penetration and scale our manufacturing capabilities, we plan to leverage our strategic partnerships. These partnerships offer access to industry-specific R&D expertise, mature supply chains, established sales channels and extensive service networks, allowing us to quickly move from pilot deployments to full-scale commercialization. We intend to co-develop sector-specific solutions, capitalizing on our partners’ market insights and reputational strength to better serve diverse customer needs. By combining our innovative AirJoule technology with their global reach and operational expertise, we will unlock value across multiple industries, establish our position as a leader in water-focused solutions and deliver long-term growth and value to our shareholders.

Recent Developments

The April 2025 PIPE

On April 23, 2025, we entered into the April 2025 PIPE Subscription Agreements with the April 2025 PIPE Investors, pursuant to which, among other things, the April 2025 PIPE Investors agreed to subscribe for and purchase from the Company, and we agreed to issue and sell to the April 2025 PIPE Investors, an aggregate of 3,775,126 newly issued shares of Class A common stock at a purchase price of $3.98 per share on the terms and subject to the conditions set forth therein. The April 2025 PIPE Subscription Agreements entitled the April 2025 PIPE Investors to shelf registration rights with respect to the shares of Class A common stock they purchased. The transaction closed on April 25, 2025, and the shares of Class A common stock were issued and sold to the April 2025 PIPE Investors in reliance on Section 4(a)(2) of the Securities Act.

Committed Equity Facility

On March 25, 2025, we entered into the Equity Line Purchase Agreement, with the Equity Line Investor. Under the terms and subject to the conditions of the Equity Line Purchase Agreement, the Company has the right, but not the obligation, to sell to the Equity Line Investor, over a 36-month period, up to an aggregate of $30,000,000 of our newly issued shares of common stock subject to certain conditions and limitations contained in the Equity Line Purchase Agreement, including that we may issue no more than the number of shares equal to 19.99% of the aggregate number of our issued and outstanding shares of common stock as of immediately prior to the execution of the Equity Line Purchase Agreement without first obtaining stockholder approval. As of June 30, 2025, sales under the Equity Line Purchase Agreement had not yet commenced.

The Amended LLC Agreement

On April 25, 2025, we entered into the Amended LLC Agreement, pursuant to which we expected to contribute additional capital to the AirJoule JV based on a business plan and annual operating budgets to be agreed between us and GE Vernova. In July 2025, we contributed an additional $2.75 million in capital contributions to the AirJoule JV.

Components of Our Results of Operations

Revenue

We anticipate that we will earn revenue from the sale of various key components that will be used in the assembly of AirJoule systems. As of June 30, 2025, no revenue has been earned from our operations.

Operating Expenses

We classify our operating expenses into the following categories:

•General and administrative: General and administrative expenses consist primarily of personnel-related expenses for our executives, consultants and advisors. These expenses also include non-personnel costs, such as rent, office supplies, legal, audit and accounting services and other professional fees.

•Research and development: Research and development expenses include internal personnel, parts, prototypes and third-party consulting costs related to preliminary research and development of our products.

•Sales and marketing: Sales and marketing expenses consist primarily of business development professional fees, advertising and marketing costs.

•Transaction costs incurred in connection with business combination: Transaction costs represent the initial recognition of the earnout shares liability and fees incurred for financial advisory, legal and other professional services that were directly related to the Business Combination.

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•Depreciation and amortization: Depreciation and amortization expense consists of depreciation of property and equipment.

Results of Operations

The following tables set forth the results of our operations for the periods presented, as well as the changes between periods. The period-to-period comparison of financial results is not necessarily indicative of future results.

The three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024

The following table sets forth the Company’s condensed consolidated statements of operations data for the three and six months ended June 30, 2025 and 2024:

		Three Months Ended June 30,												Six Months Ended June 30,
		2025				2024				Change ($)				2025				2024				Change ($)
Cost and expenses:
General and administrative		$	3,751,211			$	3,211,205			$	540,006			$	6,537,695			$	4,024,444			$	2,513,251
Research and development			401,623				1,050,804				(649,181	)			789,542				1,896,961				(1,107,419	)
Sales and marketing			7,794				74,841				(67,047	)			22,003				112,566				(90,563	)
Transaction costs incurred in connection with business combination			—				—				—				—				54,693,103				(54,693,103	)
Depreciation and amortization			2,289				1,216				1,073				3,877				2,301				1,576
Loss from operations			(4,162,917	)			(4,338,066	)			175,149				(7,353,117	)			(60,729,375	)			53,376,258
Other income (expense):
Interest income			283,733				216,480				67,253				526,758				242,626				284,132
Gain on contribution to AirJoule, LLC			—				—				—				—				333,500,000				(333,500,000	)
Equity loss from investment in AirJoule, LLC			(2,089,667	)			(580,788	)			(1,508,879	)			(4,319,945	)			(607,170	)			(3,712,775	)
Change in fair value of Earnout Shares liability			6,276,000				13,064,000				(6,788,000	)			19,108,000				5,392,000				13,716,000
Change in fair value of True Up Shares liability			—				(136,000	)			136,000				106,106				133,000				(26,894	)
Change in fair value of Subject Vesting Shares liability			934,000				1,759,000				(825,000	)			6,408,000				(666,000	)			7,074,000
Gain on settlement of legal fees			—				2,207,445				(2,207,445	)			—				2,207,445				(2,207,445	)
Other expense, net			(286,818	)			—				(286,818	)			(285,470	)			—				(285,470	)
Total other income, net			5,117,248				16,530,137				(11,412,889	)			21,543,449				340,201,901				(318,658,452	)
Income before income taxes			954,331				12,192,071				(11,237,740	)			14,190,332				279,472,526				(265,282,194	)
Income tax benefit (expense)			1,558,882				1,237,824				321,058				3,201,539				(84,487,339	)			87,688,878
Net income		$	2,513,213			$	13,429,895			$	(10,916,682	)		$	17,391,871			$	194,985,187			$	(177,593,316	)

General and Administrative

General and administrative expenses for the three months ended June 30, 2025 were $3.8 million as compared to $3.2 million for the three months ended June 30, 2024. The $0.5 million increase was primarily related to a $1.4 million increase in share-based compensation expense, a $0.4 million increase in professional services and a $0.3 million increase in salaries and benefits as a result of an increased headcount offset by a $0.6 million decrease in audit and legal fees, a $0.6 million decrease in expenses related to public company activity including insurance, director fees and licensing fees and the reimbursement of costs incurred per the statement of work with AirJoule, LLC of $0.4 million. We expect that our general and administrative expenses will increase in future periods commensurate with the expected growth of our business and increased expenditures associated with our status as an exchange-listed public company.

General and administrative expenses for the six months ended June 30, 2025 were $6.5 million as compared to $4.0 million for the six months ended June 30, 2024. The $2.5 million increase was primarily related to a $2.4 million increase in share-based compensation

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expense, a $1.3 million increase in salaries and benefits as a result of an increased headcount and a $0.6 million increase in other expenses related to public company activity offset by a $0.6 million decrease in audit and legal fees, a $0.2 million decrease in professional services, a $0.2 million decrease in licensing fees and the reimbursement of costs incurred per the statement of work with AirJoule, LLC of $0.8 million. We expect that our general and administrative expenses will increase in future periods commensurate with the expected growth of our business and increased expenditures associated with our status as an exchange-listed public company.

Research and Development

Research and development expenses for the three months ended June 30, 2025 were $0.4 million as compared to $1.1 million for the three months ended June 30, 2024. The $0.6 million decrease in research and development was primarily related to a $0.2 million increase in share-based compensation and salaries and benefits as a result of an increased headcount offset by a $0.6 million decrease in purchasing of research and development materials, patent fees and consulting services and the reimbursement of costs incurred per the statement of work with AirJoule, LLC of $0.1 million.

Research and development expenses for the six months ended June 30, 2025 were $0.8 million as compared to $1.9 million for the six months ended June 30, 2024. The $1.1 million decrease in research and development was primarily related to a $0.3 million increase in share-based compensation and salaries and benefits as a result of an increased headcount offset by a $1.1 million decrease in purchasing of research and development materials, patent fees and consulting services and the reimbursement of costs incurred per the statement of work with AirJoule, LLC of $0.3 million.

Sales and Marketing

Sales and marketing expenses for the three months ended June 30, 2025 were $7,794 as compared to $74,841 for the three months ended June 30, 2024.

Sales and marketing expenses for the six months ended June 30, 2025 were $22,003 as compared to $112,566 for the six months ended June 30, 2024.

Transaction Costs Incurred in Connection with Business Combination

Transaction costs incurred in connection with the business combination include the non-cash recognition of earnout liabilities of approximately $53.7 million and transaction costs incurred by Legacy Montana of approximately $1.0 million, which were paid in 2024.

Depreciation and Amortization

Depreciation and amortization expense for the three months ended June 30, 2025 and 2024 was $2,289 and $1,216, respectively.

Depreciation and amortization expense for the six months ended June 30, 2025 and 2024 was $3,877 and $2,301, respectively.

Interest Income

Interest income was $283,733 and $216,480 for the three months ended June 30, 2025 and 2024, respectively. This is primarily a result of the increase in our cash balance.

Interest income was $526,758 and $242,626 for the six months ended June 30, 2025 and 2024, respectively. This is primarily a result of the increase in our cash balance.

Gain on Contribution to AirJoule, LLC

An equity method investment received in exchange for noncash consideration is measured at fair value. As a result, during the three and six months ended June 30, 2024, we recognized a gain of $333.5 million on the contribution to AirJoule, LLC for the difference between our zero carrying value and the fair value of the perpetual license to intellectual property that we transferred to AirJoule, LLC.

We determined the fair value of the intellectual property by applying the multi-period excess earnings method, which involved the use of significant estimates and assumptions related to forecasted revenue growth rate and customer attrition rate, Level 3 measurements. Valuation specialists were used to develop and evaluate the appropriateness of the multi-period excess earnings method, our discount rates, attrition rate and fair value estimates using its cash flow projections.

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Equity Loss from Investment in AirJoule, LLC

As previously noted, on January 25, 2024, Legacy Montana entered into a joint venture with GE Vernova, the AirJoule JV which closed on March 4, 2024. For the three months ended June 30, 2025 and 2024, we recognized a loss of $2.1 million and $0.6 million, respectively from our 50% equity investment in the AirJoule JV. For the six months ended June 30, 2025 and 2024, we recognized a loss of $4.3 million and $0.6 million, respectively from our 50% equity investment in the AirJoule JV.

Change in Fair value of Earnout Shares Liability

Upon consummation of the Business Combination, we expensed approximately $53.7 million in Earnout Shares liability. The change in fair value of $6.3 million and $13.1 million for the three months ended June 30, 2025 and 2024, respectively, and $19.1 million and $5.4 million for the six months ended June 30, 2025 and 2024, respectively, is primarily due to a decrease in the estimated fair value of the liability and is recognized as gains in the condensed consolidated statements of operations. The fair value of the liability decreased primarily due changes in the valuation inputs, mainly a decrease in the stock price, changes in the timing of expected future cash flows and an increase in the volatility.

Change in Fair value of True Up Shares Liability

Upon consummation of the Business Combination, we assumed approximately $0.6 million in earnout true up shares liability. The change in fair value of the liability during the three and six months ended June 30, 2025 is primarily due to the triggering event and issuance of Class A common stock.

Change in Fair value of Subject Vesting Shares Liability

Upon consummation of the Business Combination, we assumed approximately $11.8 million for the subject vesting shares liability. The change in fair value of income of $0.9 million and $1.8 million during the three months ended June 30, 2025 and 2024, respectively, and $6.4 million and $(0.7) million during the six months ended June 30, 2025 and 2024, respectively is primarily due to a decrease in the estimated fair value of the liability recognized as a gain (loss) in the condensed consolidated statements of operations. The fair value of the liability decreased primarily due changes in the valuation inputs, mainly a decrease in the stock price, changes in the timing of expected future cash flows and an increase in the volatility.

Income Tax Benefit (Expense)

For the three months ended June 30, 2025 and 2024, income tax benefit was $1.6 million and $1.2 million, respectively. For the six months ended June 30, 2025 and 2024, income tax benefit (expense) was $3.2 million and $(84.5) million, respectively. During the three and six months ended June 30, 2024, our contribution of a perpetual license to AirJoule, LLC’s intellectual property was measured at fair value resulted in a book gain and a temporary difference between book and taxable income. The temporary difference resulted in the recognition of a deferred tax expense and deferred tax liabilities of approximately $87.8 million. This expense was partially offset by the recognition of deferred tax assets in connection with the Company now being a corporation through the Business Combination.

Liquidity and Capital Resources

The April 2025 PIPE

On April 23, 2025, we entered into the April 2025 PIPE Subscription Agreements with the April 2025 PIPE Investors pursuant to which, among other things, the April 2025 PIPE Investors agreed to subscribe for and purchase from the Company, and we agreed to issue and sell to the April 2025 PIPE Investors, an aggregate of 3,775,126 newly issued shares of Class A common stock at a purchase price of $3.98 per share on the terms and subject to the conditions set forth therein. The April 2025 PIPE Subscription Agreements entitled the April 2025 PIPE Investors to shelf registration rights with respect to the shares of Class A common stock they purchased. The transaction closed on April 25, 2025, and the shares of Class A common stock were issued and sold to the April 2025 PIPE Investors in reliance on Section 4(a)(2) of the Securities Act.

Committed Equity Facility

On March 25, 2025, we entered into the Equity Line Purchase Agreement with the Equity Line Investor. Under the terms and subject to the conditions of the Equity Line Purchase Agreement, the Company has the right, but not the obligation, to sell to the Equity Line Investor, over a 36-month period, up to an aggregate of $30,000,000 of our newly issued shares of common stock subject to certain conditions and limitations contained in the Equity Line Purchase Agreement, including that we may issue no more than the number of shares equal to 19.99% of the aggregate number of our issued and outstanding shares of common stock as of immediately prior to the

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execution of the Equity Line Purchase Agreement without first obtaining stockholder approval. As of June 30, 2025, sales under the Equity Line Purchase Agreement had not yet commenced.

Capital Contribution

Pursuant to the A&R Joint Venture Agreement, we are expected to contribute additional capital to the AirJoule JV based on a business plan and annual operating budgets to be agreed between us and GE Vernova. During the six months ended June 30, 2025, we contributed an additional $10.0 million in capital contributions to the AirJoule JV.

General

Our primary sources of liquidity have been cash from contributions from founders or equity capital raised from other investors. We had retained earnings of approximately $215.9 million as of June 30, 2025. As of June 30, 2025, we had $29.5 million of working capital including $30.5 million in cash, cash equivalents and restricted cash.

We assess liquidity in terms of our ability to generate adequate amounts of cash to meet current and future needs. Our expected primary uses of cash on a short and long-term basis are for working capital requirements, capital expenditures and other general corporate services. Our primary working capital requirements are for project execution activities including purchases of materials, services and payroll which fluctuate during the year, driven primarily by the timing and extent of activities required for new and existing projects. Management expects that future operating losses and negative operating cash flows may increase from historical levels because of additional costs and expenses related to the development of its technology and the development of market and strategic relationships with other businesses and customers.

Our future capital requirements will depend on many factors, including the timing and extent of spending to support the launch of our product and research and development efforts, the degree to which we are successful in launching new business initiatives and the cost associated with these initiatives and the growth of our business generally. Pursuant to the A&R Joint Venture Agreement, we contributed $10 million in cash to the AirJoule JV at the JV closing and in June 2024, GE Vernova contributed $100 to the AirJoule JV. Pursuant to the A&R Joint Venture Agreement, we agreed to make additional capital contributions to the AirJoule JV based on a business plan and annual operating budgets to be agreed between the Company and GE Vernova, and our remaining commitment for capital contributions to the AirJoule JV is $85.0 million as of June 30, 2025. In general, for the first six years, GE Vernova has the right, but not the obligation, to make capital contributions to the AirJoule JV.

In order to finance these opportunities and associated costs, it is possible that we would need to raise additional financing if the proceeds realized to date are insufficient to support our business needs. While we believe that the proceeds realized to date will be sufficient to meet our currently contemplated business needs, management cannot assure that this will be the case. If additional financing is required by us from outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital on acceptable terms when needed, our product development business, results of operations and financial condition would be materially and adversely affected.

Cash flows for the six months ended June 30, 2025 and 2024

The following table summarizes our cash flows from operating, investing and financing activities for the six months ended June 30, 2025 and 2024:

		For the Six Months Ended June 30,
		2025				2024
Net cash used in operating activities			(2,163,485	)			(17,576,561	)
Net cash used in investing activities			(10,011,376	)			(10,006,554	)
Net cash provided by financing activities			14,655,824				61,855,930
Net increase in cash and cash equivalents			2,480,963				34,272,815

Cash Flows from Operating Activities

During the six months ended June 30, 2025, net cash used in operating activities was $2.2 million and primarily reflected our net income of $17.3 million, a $4.3 million equity loss from our investment in AirJoule, LLC and a $2.2 million increase in our operating assets and liabilities offset by net noncash operating activities of $25.3 million of changes in fair value of our Earnout, True Up, Subject Vesting shares and Equity Line Obligation liabilities and $0.7 million of share-based compensation and deferred tax benefit. We expect to continue to use cash in our operating activities with the expected growth of our business.

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During the six months ended June 30, 2024, net cash used in operating activities was $17.6 million and primarily reflected our net income of $195.0 million, a $84.5 million deferred tax expense and a $0.6 million equity loss from our investment in AirJoule, LLC offset by net noncash operating activities of $282.0 million related to the contribution to AirJoule, LLC, the settlement of legal fees and other costs in connection with the business combination, $4.9 million of changes in fair value of our Earnout, True Up and Subject Vesting shares liabilities and a $11.0 million decrease in our operating assets and liabilities.

Cash Flows from Investing Activities

During the six months ended June 30, 2025, net cash used in investing activities was $10.0 million primarily as a result of our $10 million contribution made to the AirJoule JV.

During the six months ended June 30, 2024, net cash used in investing activities was $10.0 million primarily as a result of our $10 million contribution made to the AirJoule JV.

Cash Flows from Financing Activities

During the six months ended June 30, 2025, net cash provided by financing activities was $14.7 million primarily as a result of the $14.5 million net proceeds from the April 2025 PIPE Offering and $0.1 million of proceeds from the exercise of options.

During the six months ended June 30, 2024, net cash provided by financing activities was $61.9 million and was primarily related to the $61.8 million net proceeds from the issuance of common stock related to private placements prior to the Merger, and $0.1 million of proceeds from the exercise of stock options and warrants.

Contractual Obligations and Commitments

Royalties

In October 2021, we entered into a patent license agreement with a third party whereby the third party granted us rights to use certain of their patents in exchange for an upfront payment and royalties based on a percentage of net sales until such patents expire. In connection with this, the Company agreed to a minimum royalty amount of which $75,000 and $62,500 was expensed for the three months ended June 30, 2025 and 2024, respectively and $150,000 and $125,000 for the six months ended June 30, 2025 and 2024. At June 30, 2025 and December 31, 2024, $150,000 and $250,000, respectively, was accrued in the accompanying condensed consolidated balance sheets.

Joint Venture Agreements

On October 27, 2021, we entered into a joint venture agreement with CATL, pursuant to which we and CATL formed CAMT. We and CATL both own 50% of CAMT’s issued and outstanding shares. Under the joint venture agreement, as revised, CAMT has the exclusive right to commercialize our AirJoule technology in Europe and Asia.

Pursuant to the Amended and Restated Joint Venture Agreement for CAMT, entered into on September 29, 2023, Legacy Montana and CATL US have each agreed to contribute $6.0 million to CAMT. Contributions will be requested by CAMT once a business plan and operating budget is set by CAMT’s board of directors. No action to establish a business plan or operating budget has occurred to date. Any additional financing beyond the initial $12.0 million (i.e., $6.0 million from each of Legacy Montana and CATL US) will be subject to the prior mutual agreement of Legacy Montana and CATL US. CAMT is managed by a four-member board of directors, with two directors (including the chairman) designated by CATL US and two directors (including the vice chairman) designated by Legacy Montana. In the event of an equal vote, the chairman may cast the deciding vote. Certain reserved matters, including debt issuances exceeding $5.0 million in a single transaction or in aggregate within a fiscal year, amendments to CAMT’s constitutional documents the annual financial budget of CAMT, and any transaction between CAMT and CATL US or Legacy Montana in an amount exceeding $10.0 million in a single transaction or in aggregate within a fiscal year, require the unanimous vote of both CATL US and Legacy Montana or all directors. As of June 30, 2025, we have not funded this joint venture or contributed any assets to the joint venture.

The purpose of Legacy Montana’s joint venture with CATL US is to commercialize our AirJoule technology in Asia and Europe and, pursuant to the Amended and Restated Joint Venture Agreement for CAMT, CAMT has the exclusive right to commercialize AirJoule technology in those territories. Subject to the oversight of CAMT’s board, CATL US is responsible for managing the day-to-day operations of CAMT (including the nomination and replacement of the Chief Executive Officer of CAMT), and is responsible for providing CAMT and any subsidiaries formed by CAMT with, among other things, administrative services, supply chain support, assistance in obtaining required permits and approvals and assistance in purchasing or leasing land and equipment.

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Critical Accounting Estimates

There have been no material changes to the critical accounting policies as disclosed in “Part I—Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Estimates” in our Quarterly Report on Form 10-Q for the three months ended March 31, 2025.

Recent Accounting Pronouncements

A discussion of recently issued accounting standards applicable to the Company is described in Note 3 - Summary of Significant Accounting Policies, in the Notes to Financial Statements contained elsewhere in this Current Report on Form 10-Q.

Off Balance Sheet Arrangements

We did not have any off-balance sheet arrangements as of June 30, 2025.

Emerging Growth Company Status

We are an emerging growth company as defined in the JOBS Act. The JOBS Act permits companies with emerging growth company status to take advantage of an extended transition period to comply with new or revised accounting standards, delaying the adoption of these accounting standards until they would apply to private companies. We have elected to use this extended transition period to enable it to comply with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, our financial statements may not be comparable to companies that comply with the new or revised accounting standards as of public company effective dates.

In addition, we intend to rely on the other exemptions and reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an emerging growth company, we intend to rely on such exemptions, we are not required to, among other things: (i) provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act; (iii) comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis); and (iv) disclose certain executive compensation-related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive Officer’s compensation to median employee compensation.

We will remain an emerging growth company under the JOBS Act until the earliest of (i) the last day of our first fiscal year following the fifth anniversary of the closing of XPDB’s initial public offering, (ii) the last date of our fiscal year in which we have total annual gross revenue of at least $1.235 billion, (iii) the date on which we are deemed to be a “large accelerated filer” under the rules of the SEC with at least $700.0 million of outstanding securities held by non-affiliates or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the previous three years.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not applicable.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our principal executive officer and our principal financial officer, evaluated, as of the end of the period covered by this Quarterly Report on Form 10-Q, the effectiveness of our disclosure controls and procedures. Based on this evaluation of our disclosure controls and procedures as of June 30, 2025, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures as of such date are effective at the reasonable assurance level. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and our management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Changes in Internal Control Over Financial Reporting

There were no significant changes in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended) during the three months ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings

We are and, from time to time, we may become involved in legal proceedings or be subject to claims arising in the ordinary course of our business. We are not presently a party to any other legal proceedings that, in the opinion of our management, if determined adversely to us, would individually or taken together have a material adverse effect on our business, operating results, financial condition, or cash flows.

Item 1A. Risk Factors

Our operations and financial results are subject to various risks and uncertainties, including the factors discussed in Part I, Item 1A, Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2024, which could adversely affect our business, financial conditions and future results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On April 23, 2025, we entered into the April 2025 PIPE Subscription Agreements with the April 2025 PIPE Investors, pursuant to which, among other things, the April 2025 PIPE Investors agreed to subscribe for and purchase from the Company, and the Company agreed to issue and sell to the April 2025 PIPE Investors, an aggregate of 3,775,126 newly issued shares of Class A common stock at a purchase price of $3.98 per share on the terms and subject to the conditions set forth therein. The April 2025 PIPE Subscription Agreements entitled the April 2025 PIPE Investors to shelf registration rights with respect to the shares of Class A common stock they purchased. The transaction closed on April 25, 2025, and the shares of Class A common stock were issued and sold to the April 2025 PIPE Investors in reliance on Section 4(a)(2) of the Securities Act. We expect to use the proceeds for the funding of future capital expenditures.

On March 25, 2025, we entered into the Equity Line Purchase Agreement with the Equity Line Investor, pursuant to which, among other things, we may, in our sole discretion, elect sell to the Equity Line Investor up to 4,250,000 shares of our Class A common stock, from time to time after the date of this prospectus and during the term of the Purchase Agreement. These securities will be issued and sold in reliance on Section 4(a)(2) of the Securities Act. As of June 30, 2025, sales under the Equity Line Purchase Agreement had not yet commenced.

Item 3. Defaults Upon Senior Securities

None.

Item4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Rule 10b5-1 and Non-Rule 10b5-1 Trading Arrangements

During the quarter ended June 30, 2025, no director or officer (as defined in Rule 16a-1(f) under the Exchange Act) of the Company adopted or terminated a “Rule 10b5-1 trading agreement” or “non-Rule 10b5-1 trading agreement,” as each term is defined in Item 408 of Regulation S-K.

Amended and Restated Executive Severance Plan

On August 12, 2025, the Compensation Committee of the Board of Directors of the Company adopted the AirJoule Technologies Corporation Amended and Restated Executive Severance Plan (the “Amended Plan”). The Amended Plan amends and restates the Montana Technologies Corporation Executive Severance Plan (the “Original Plan”) in its entirety.

Under the Amended Plan, as it relates to Matthew B. Jore (Chief Executive Officer of the Company), Stephen S. Pang (Chief Financial Officer of the Company) or Patrick C. Eilers (Executive Chairman of the Company), each of whom is a named executive officer (each, an “Executive”), if the applicable Executive experiences a termination of employment (i) by the Company without “cause” or by the Executive for “good reason” (each as defined in the Amended Plan) during the 12-month period following the consummation of a “change in control” of the Company (as defined in the Amended Plan), or (ii) by the Company without “cause”

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during the three-month period prior to the consummation of the change in control (each, a “CIC Qualifying Termination”), the applicable Executive will be eligible to receive the following payments and benefits:

•an amount equal to 18 months (or, for Mr. Jore, 24 months) of base salary, payable in a lump-sum;

•an amount equal to 18 months (or, for Mr. Jore, 24 months) of the Company’s portion of monthly COBRA premium contributions for the Executive and his covered dependents, payable in a lump-sum; and

•an amount equal to 150% (or, for Mr. Jore, 200%) of the Executive’s target annual cash performance bonus for the calendar year in which such CIC Qualifying Termination occurs, payable in a lump-sum.

The Amended Plan makes no changes to the other terms and conditions (including the severance payments and benefits that are available to the Executives upon other types of qualifying terminations) of the Original Plan, which are described in the Company’s 2025 Proxy Statement filed with the SEC on April 16, 2025.

The foregoing description of the Amended Plan is not complete and is qualified in its entirety by reference to the full text of the Amended Plan, which is attached as Exhibit 10.6 to this Quarterly Report on Form 10-Q and incorporated into this Item 5 by reference.

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ITEM 6. EXHIBITS

The following exhibits are filed as part of, or incorporated by reference into, this Report.

Exhibit No.		Description
2.1		Agreement and Plan of Merger, dated as of June 5, 2023, by and among Montana Technologies LLC, XPDB Merger Sub, LLC and Power & Digital Infrastructure Acquisition II Corp. (incorporated by reference to Exhibit 2.1 of the Company’s Current Report on Form 8-K, filed with the SEC on June 5, 2023).
2.2		First Amendment to Agreement and Plan of Merger, dated February 5, 2024, by and among Power & Digital Infrastructure Acquisition II Corp., Montana Technologies LLC and XPDB Merger Sub LLC (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed with the SEC on February 5, 2024).
2.3		Third Amended and Restated Certificate of Incorporation of AirJoule Technologies Corporation (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K, filed with the SEC on November 13, 2024)
3.1		Third Amended and Restated Bylaws of AirJoule Technologies Corporation (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K, filed with the SEC on November 13, 2024)
4.1		Public Warrant Agreement, dated December 9, 2021, by and between the Registrant and Continental Stock Transfer & Trust Company, as warrant agent (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed with the SEC on December 14, 2021).
4.2		Private Warrant Agreement, dated December 9, 2021, by and between the Registrant and Continental Stock Transfer & Trust Company, as warrant agent (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on December 14, 2021).
10.1		Common Stock Purchase Agreement, dated as of March 25, 2025, by and between the Company and B. Riley Principal Capital II, LLC (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed with the SEC on March 25, 2025).
10.2		Registration Rights Agreement, dated as of March 25, 2025, by and between the Company and B. Riley Principal Capital II, LLC (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, filed with the SEC on March 25, 2025).
10.3		Form of Subscription Agreement (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed with the SEC on April 24, 2025).
10.4		Second Amended and Restated Limited Liability Company Agreement of AirJoule, LLC (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed with the SEC on May 1, 2025).
10.5+		Amended and Restated Non-Employee Director Compensation Program.
10.6+*		Amended and Restated Executive Severance Plan.
31.1*		Certification of Chief Executive Officer (Principal Executive Officer) Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of Chief Financial Officer (Principal Financial) Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*		Certification of Chief Executive Officer (Principal Executive Officer) Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*		Certification of Chief Financial Officer (Principal Financial) Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*		Inline XBRL Instance Document.
101.SCH*		Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents
104*		Cover Page Interactive Data File (embedded within the Inline XBRL document

*	Filed or furnished herewith.
+	Indicates management contract or compensatory plan.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	AIRJOULE TECHNOLOGIES CORPORATION
August 14, 2025	By:	/s/ Stephen S. Pang
	Name:	Stephen S. Pang
	Title:	Chief Financial Officer

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FAQ

What was AirJoule (AIRJ) net income for the six months ended June 30, 2025?

The company reported $17,391,871 of net income for the six months ended June 30, 2025.

How much cash did AIRJ have on June 30, 2025?

AirJoule held $30,502,711 of cash, cash equivalents and restricted cash as of June 30, 2025 (restricted cash approx. $30,633).

What is the carrying value of the investment in the AirJoule joint venture?

The consolidated balance sheet shows an investment in AirJoule, LLC of $343,858,688 as of June 30, 2025.

How much did AIRJ raise from the April 2025 PIPE and is there additional committed financing?

The company received $14,556,106 net proceeds from the April 2025 PIPE and has an Equity Line Purchase Agreement allowing up to $30,000,000 over 36 months (not yet drawn as of June 30, 2025).

What remaining capital contribution does AIRJ owe to the AirJoule JV?

AirJoule discloses a remaining commitment for capital contributions to the AirJoule JV of $85.0 million as of June 30, 2025.

What material contingent or liability-classified equity obligations remain on AIRJ's balance sheet?

As of June 30, 2025 the company reports an Earnout Shares liability of $5,416,000 and a Subject Vesting Shares liability of $1,411,000.