Bloom Energy : Amendment to Quarterly Report (Form 10-Q/A)

About this update from Bloom Energy Corporation

The purpose of this amendment to our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2026 (the "Form 10-Q"), as filed with the Securities and Exchange Commission on July 28, 2026, is to address a transposition of references to "six months" and "three months" in the Form 10-Q under Item 1 - Financial Statements, Note 1. Nature of Business, Liquidity and Basis of Presentation - Concentration of Risk - Customer Risk. The first paragraph thereunder is updated as follows: " Customer Risk- During the six months ended June 30, 2026, revenue from two customers*, the second of which is our related party (see Note 11-Related Party Transactions in this Quarterly Report on Form 10-Q), accounted for approximately 44% and 21% of our total revenue. During the three months ended June 30, 2026, revenue from one customer*, which is not our related party, accounted for approximately 73% of our total revenue." Table of Contents Page PART I-FINANCIAL INFORMATION Item 1-Financial Statements (unaudited) 4 Condensed Consolidated Balance Sheets 4 Condensed Consolidated Statements of Operations 5 Condensed Consolidated Statements of Comprehensive Income (Loss) 6 Condensed Consolidated Statements of Changes in Stockholders' Equity 7 Condensed Consolidated Statements of Cash Flows 9 Notes to Unaudited Condensed Consolidated Financial Statements 10 Item 6-Exhibits 40 Signatures 41 PART I- FINANCIAL INFORMATION ITEM 1-FINANCIAL STATEMENTS Bloom Energy Corporation Condensed Consolidated Balance Sheets (in thousands, except share data) (unaudited) June 30, December 31, 2026 2025 Assets Current assets: Cash and cash equivalents 1 $ 2,666,859 $ 2,454,108 Restricted cash 1,050 1,973 Accounts receivable, less allowance for credit losses of $2,998 and $460 as of June 30, 2026 and December 31, 2025, respectively 1, 2 458,126 371,796 Contract assets 3 365,461 178,928 Inventories 1 758,188 643,306 Deferred cost of revenue 67,273 30,651 Customer consideration asset 12 90,967 - Prepaid expenses and other current assets 1, 4 182,138 49,805 Total current assets 4,590,062 3,730,567 Property, plant and equipment, net 1 443,388 398,507 Investments in unconsolidated affiliates 10 28,090 10,037 Operating lease right-of-use assets 1 106,475 108,541 Restricted cash 20,599 25,499 Contract assets 5 62,837 62,258 Deferred cost of revenue 7,675 4,099 Customer consideration asset 12 215,533 - Other long-term assets 1, 6 153,742 57,203 Total assets $ 5,628,401 $ 4,396,711 Liabilities and stockholders' equity Current liabilities: Accounts payable 1 $ 309,929 $ 203,129 Accrued warranty 7 77,797 20,013 Accrued expenses and other current liabilities 1, 8 315,919 222,254 Deferred revenue and customer deposits 9 327,145 100,975 Operating lease liabilities 1 23,094 22,000 Financing obligations 62,034 51,308 Recourse debt 4,686 - Non-recourse debt 1 2,583 4,153 Total current liabilities 1,123,187 623,832 Deferred revenue and customer deposits 117,901 42,840 Operating lease liabilities 1 102,730 106,935 Financing obligations 144,446 192,460 Recourse debt 2,470,704 2,613,726 Deferred profit in transactions with unconsolidated affiliates 11 19,560 13,928 Other long-term liabilities 9,202 10,027 Total liabilities $ 3,987,730 $ 3,603,748 Commitments and contingencies (Note 12) Stockholders' equity: Common stock: 0.0001 par value; 600,000,000 shares authorized, and 293,354,001 shares and 280,045,459 shares issued and outstanding, at June 30, 2026 and December 31, 2025, respectively 13 29 28 Additional paid-in capital 5,332,587 4,755,965 Accumulated other comprehensive income (loss) 347 (369) Accumulated deficit (3,720,965) (3,986,983) Total stockholders' equity attributable to common stockholders 1,611,998 768,641 Noncontrolling interest 28,673 24,322 Total stockholders' equity $ 1,640,671 $ 792,963 Total liabilities and stockholders' equity $ 5,628,401 $ 4,396,711 1 We have a variable interest entity related to a joint venture in the Republic of Korea (see Note 11- Related Party Transactions in this Quarterly Report on Form 10-Q) , which represents a portion of the consolidated balances recorded within these financial statement line items. 2 Including amounts from related parties of $76.1 million and $151.9 million as of June 30, 2026, and December 31, 2025, respectively. 3 Including amounts from related parties of $43.9 million and $3.0 million as of June 30, 2026, and December 31, 2025, respectively. 4 There was no related party balance as of June 30, 2026. Including amount from related parties of $1.2 million as of December 31, 2025. 5 Including amounts from related parties of $47.2 million and $48.8 million as of June 30, 2026, and December 31, 2025, respectively. 6 There was no related party balance as of June 30, 2026. Including amount from related parties of $6.0 million as of December 31, 2025. 7 Including amounts from related parties of $8.6 million and $0.8 million as of June 30, 2026, and December 31, 2025, respectively. 8 Including amounts from related parties of $2.5 million and $0.04 million as of June 30, 2026, and December 31, 2025, respectively. 9 Including amounts from related parties of $7.0 million and $6.9 million as of June 30, 2026, and December 31, 2025, respectively. 10 Represent related party investments in Fund JVs (see Note 7- Investments in Unconsolidated Affiliates in this Quarterly Report on Form 10-Q) . 11 Represent the excess of unrealized profit from sales to the Fund JVs over the carrying value of the related equity-method investments (see Note 7- Investments in Unconsolidated Affiliates in this Quarterly Report on Form 10-Q). 12 Represent related party upfront share-based consideration payable to a customer's customer (see Note 3 - Revenue Recognition in this Quarterly Report on Form 10-Q). 13 On May 27, 2026, the Company filed with the Delaware Secretary of State a Certificate of Second Amendment to its Restated Certificate of Incorporation which (among other things) renamed its Class A common stock as common stock and eliminated outdated references to Class B common stock. Prior to such amendment, the Company had 470,092,742 shares of Class B common stock authorized, but as of December 31, 2025, no such shares were issued or outstanding. References in this Quarterly Report on Form 10-Q to Class A common stock have been updated to refer to common stock. The accompanying notes are an integral part of these condensed consolidated financial statements. Bloom Energy Corporation Condensed Consolidated Statements of Operations (in thousands, except per share data) (unaudited) Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Revenue: Product $ 935,413 $ 296,611 $ 1,588,761 $ 508,480 Installation 50,978 37,372 76,909 71,023 Service 69,023 54,449 130,902 107,997 Electricity 9,951 12,810 19,847 39,763 Total revenue 1 1,065,365 401,242 1,816,419 727,263 Cost of revenue: Product 593,957 198,746 1,023,189 338,319 Installation 52,829 38,224 87,909 71,539 Service 56,148 49,408 109,812 102,266 Electricity 6,859 7,741 14,393 19,309 Total cost of revenue 709,793 294,119 1,235,303 531,433 Gross profit 355,572 107,123 581,116 195,830 Operating expenses: Research and development 58,873 40,768 115,722 81,380 Sales and marketing 43,045 24,066 81,484 46,331 General and administrative 2 71,417 45,792 129,483 90,692 Total operating expenses 173,335 110,626 326,689 218,403 Income (loss) from operations 182,237 (3,503) 254,427 (22,573) Interest income 20,881 6,623 41,482 15,176 Interest expense 3 (8,906) (14,440) (17,510) (28,851) Equity in earnings (loss) of unconsolidated affiliates 4 4,346 - (12,656) - Other income, net 2,307 2,373 8,504 4,421 Loss on extinguishment of debt - (32,340) - (32,340) (Loss) gain on revaluation of embedded derivatives (539) 112 215 9 Income (loss) before income taxes 200,326 (41,175) 274,462 (64,158) Income tax provision 1,470 1,017 1,915 1,448 Net income (loss) 198,856 (42,192) 272,547 (65,606) Less: Net income attributable to noncontrolling interest 2,566 427 5,604 827 Net income (loss) attributable to common stockholders $ 196,290 $ (42,619) $ 266,943 $ (66,433) Net earnings (loss) per share available to common stockholders: Basic $ 0.68 $ (0.18) $ 0.94 $ (0.29) Diluted $ 0.62 $ (0.18) $ 0.85 $ (0.29) Weighted average shares used to compute net earnings (loss) per share available to common stockholders: Basic 287,288 232,542 284,518 231,383 Diluted 323,331 232,542 323,649 231,383 1 Including related party revenue of $2.8 million and $376.1 million for the three and six months ended June 30, 2026, respectively, and $27.1 million and $29.9 million for the three and six months ended June 30, 2025, respectively. 2 There were no related party general and administrative expenses for the three and six months ended June 30, 2026. Including related party general and administrative expenses of $0.2 million and $0.4 million for the three and six months ended June 30, 2025, respectively. 3 There were no related party interest expense for the three and six months ended June 30, 2026. Including related party interest expense of $0.1 million and $0.1 million for the three and six months ended June 30, 2025, respectively. 4 Represent related party equity in earnings (loss) of the Fund JVs (see Note 7- Investments in Unconsolidated Affiliates in this Quarterly Report on Form 10-Q) . The accompanying notes are an integral part of these condensed consolidated financial statements. Bloom Energy Corporation Condensed Consolidated Statements of Comprehensive Income (Loss) (in thousands) (unaudited) Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Net income (loss) $ 198,856 $ (42,192) $ 272,547 $ (65,606) Other comprehensive (loss) income, net of taxes: Foreign currency translation adjustment (3,052) 2,702 (560) 3,064 Other comprehensive (loss) income, net of taxes (3,052) 2,702 (560) 3,064 Comprehensive income (loss) 195,804 (39,490) 271,987 (62,542) Less: Comprehensive income attributable to noncontrolling interest 2,134 1,665 4,351 2,104 Comprehensive income (loss) attributable to common stockholders $ 193,670 $ (41,155) $ 267,636 $ (64,646) The accompanying notes are an integral part of these condensed consolidated financial statements. Bloom Energy Corporation Condensed Consolidated Statements of Changes in Stockholders' Equity (in thousands, except share data) (unaudited) Three Months Ended June 30, 2026 Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Total Equity Attributable to Common Stockholders Noncontrolling Interest Total Stockholders' Equity Shares Amount Balances at March 31, 2026 284,207,963 $ 28 $ 4,835,729 $ 2,967 $ (3,917,255) $ 921,469 $ 26,539 $ 948,008 Issuance of restricted stock awards 873,862 - - - - - - - Exercise of stock options 418,013 - 7,324 - - 7,324 - 7,324 Stock-based compensation - - 51,554 - - 51,554 - 51,554 Conversions of the Green Notes (Note 8) 5,699,932 1 126,468 - - 126,469 - 126,469 Share-based consideration payable to customer's customer (Note 3) - - 311,512 - - 311,512 - 311,512 Issuance of common stock upon warrant exercise, including incremental shares (cashless) (Note 3) 2,154,231 - - - - - - - Foreign currency translation adjustment - - - (2,620) - (2,620) (432) (3,052) Net income - - - - 196,290 196,290 2,566 198,856 Balances at June 30, 2026 293,354,001 $ 29 $ 5,332,587 $ 347 $ (3,720,965) $ 1,611,998 $ 28,673 $ 1,640,671 Three Months Ended June 30, 2025 Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Equity Attributable to Common Stockholders Noncontrolling Interest Total Stockholders' Equity Shares Amount Balances at March 31, 2025 231,969,446 $ 23 $ 4,502,881 $ (2,270) $ (3,922,363) $ 578,271 $ 23,184 $ 601,455 Issuance of restricted stock awards 1,679,509 - - - - - - - Exercise of stock options 12,213 - 30 - - 30 - 30 Stock-based compensation - - 29,188 - - 29,188 - 29,188 Premium on convertible debt - - 28,247 - - 28,247 - 28,247 Foreign currency translation adjustment - - - 1,464 - 1,464 1,238 2,702 Net (loss) income - - - - (42,619) (42,619) 427 (42,192) Balances at June 30, 2025 233,661,168 $ 23 $ 4,560,346 $ (806) $ (3,964,982) $ 594,581 $ 24,849 $ 619,430 Six Months Ended June 30, 2026 Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Total Equity Attributable to Common Stockholders Noncontrolling Interest Total Stockholders' Equity Shares Amount Balances at December 31, 2025 280,045,459 $ 28 $ 4,755,965 $ (369) $ (3,986,983) $ 768,641 $ 24,322 $ 792,963 Issuance of restricted stock awards 3,032,439 - - - - - - - ESPP purchase 644,651 - 8,073 - - 8,073 - 8,073 Exercise of stock options 800,297 - 15,086 - - 15,086 - 15,086 Stock-based compensation - - 100,410 - - 100,410 - 100,410 Accrued dividend - - - - (994) (994) - (994) Legal reserve - - - - 92 92 - 92 Conversions of the Green Notes (Note 8) 6,676,924 1 144,631 - - 144,632 - 144,632 Share-based consideration payable to customer's customer (Note 3) - - 308,422 - - 308,422 - 308,422 Issuance of common stock upon warrant exercise, including incremental shares (cashless) (Note 3) 2,154,231 - - - - - - - Foreign currency translation adjustment - - - 716 (23) 693 (1,253) (560) Net income - - - - 266,943 266,943 5,604 272,547 Balances at June 30, 2026 293,354,001 $ 29 $ 5,332,587 $ 347 $ (3,720,965) $ 1,611,998 $ 28,673 $ 1,640,671 Six Months Ended June 30, 2025 Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Equity Attributable to Common Stockholders Noncontrolling Interest Total Stockholders' Equity Shares Amount Balances at December 31, 2024 229,142,474 $ 23 $ 4,462,659 $ (2,593) $ (3,897,618) $ 562,471 $ 22,745 $ 585,216 Issuance of restricted stock awards 3,723,916 - - - - - - - ESPP purchase 630,607 - 6,417 - - 6,417 - 6,417 Exercise of stock options 164,171 - 1,264 - - 1,264 - 1,264 Stock-based compensation - - 61,759 - - 61,759 - 61,759 Accrued dividend - - - - (1,024) (1,024) - (1,024) Legal reserve - - - - 93 93 - 93 Premium on convertible debt - - 28,247 - - 28,247 - 28,247 Foreign currency translation adjustment - - - 1,787 - 1,787 1,277 3,064 Net (loss) income - - - - (66,433) (66,433) 827 (65,606) Balances at June 30, 2025 233,661,168 $ 23 $ 4,560,346 $ (806) $ (3,964,982) $ 594,581 $ 24,849 $ 619,430 The accompanying notes are an integral part of these condensed consolidated financial statements. Bloom Energy Corporation Condensed Consolidated Statements of Cash Flows (in thousands) (unaudited) Six Months Ended June 30, 2026 2025 Cash flows from operating activities: Net income (loss) $ 272,547 $ (65,606) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization 27,025 24,582 Non-cash lease expense 16,026 16,452 Equity in loss of unconsolidated affiliates 12,656 - Stock-based compensation expense 100,432 59,338 Amortization of debt issuance costs 6,798 3,723 Loss on extinguishment of debt - 32,340 Net gain on failed sale-and-leaseback transactions (13,527) (827) Share-based consideration payable to customer's customer (Note 3 ) 13 1,922 - Allowance for credit losses 3,080 - Unrealized foreign currency exchange loss (gain) 2,474 (4,795) Other 12 87 45 Changes in operating assets and liabilities: Accounts receivable 1 (89,590) (129,904) Contract assets 2 (187,654) 15,364 Inventories (115,057) (142,600) Deferred cost of revenue (40,046) 30,099 Prepaid expenses and other current assets 3 (132,333) 6,134 Other long-term assets 4 (96,640) 826 Operating lease right-of-use assets and operating lease liabilities 5 (17,071) (16,754) Financing lease liabilities 255 982 Accounts payable 6 100,422 52,790 Accrued warranty 7 57,784 (4,566) Accrued expenses and other current liabilities 8 89,391 (22,586) Deferred revenue and customer deposits 9 301,232 (178,807) Deferred profit with equity method investees and other long-term liabilities 10 (171) (23) Net cash provided by (used in) operating activities 300,042 (323,793) Cash flows from investing activities: Purchase of property, plant and equipment (77,823) (21,504) Proceeds from sale of property, plant and equipment 127 76 Investments in unconsolidated affiliates 11 (22,796) - Net cash used in investing activities (100,492) (21,428) Cash flows from financing activities: Payment of debt issuance costs (787) (3,348) Repayment of debt (1,347) - Proceeds from financing obligations 4 - Repayment of financing obligations (11,816) (5,465) Proceeds from issuance of common stock 23,159 7,681 Dividend paid (925) (947) Other (5) 150 Net cash provided by (used in) financing activities 8,283 (1,929) Effect of exchange rate changes on cash, cash equivalent, and restricted cash (905) 2,226 Net increase (decrease) in cash, cash equivalents, and restricted cash 206,928 (344,924) Cash, cash equivalents, and restricted cash: Beginning of period 2,481,580 950,971 End of period $ 2,688,508 $ 606,047 Supplemental disclosure of cash flow information: Cash paid during the period for interest $ 10,676 $ 26,660 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases 17,071 16,585 Operating cash flows from finance leases 225 169 Cash paid during the period for income taxes 2,192 775 Non-cash investing and financing activities: Liabilities recorded for property, plant and equipment, net $ 10,773 $ 4,285 Derecognition of financing obligations 26,190 - Recognition of operating lease right-of-use asset during the year-to-date period 7,792 3,711 Recognition of finance lease right-of-use asset during the year-to-date period 241 956 Unfunded investment commitment (Note 11) 14 1,438 - Conversions of the Green Notes (Note 8) 144,632 - Premium on convertible debt - 28,247 Face value of 2.5% Green Notes due August 2025 exchanged - 112,769 Face value of additional 3.0% Green Notes due June 2029 issued in the Debt Exchange - 115,725 1 Including changes in related party balances of $75.8 million and $2.6 million for the six months ended June 30, 2026 and 2025, respectively. 2 Including changes in related party balances of $39.4 million and $0.8 million for the six months ended June 30, 2026 and 2025, respectively. 3 Including changes in related party balances of $1.2 million and $0.3 million for the six months ended June 30, 2026 and 2025, respectively. 4 Including changes in related party balances of $6.0 million and $0.1 million for the six months ended June 30, 2026 and 2025, respectively. 5 There were no related party balances as of June 30, 2026, and December 31, 2025. Including changes in related party balances of $0.2 million for the six months ended June 30, 2025. 6 There were no related party balances as of June 30, 2026, and December 31, 2025. Including changes in related party balances of $0.04 million for the six months ended June 30, 2025. 7 Including changes in related party balances of $7.8 million and $0.1 million for the six months ended June 30, 2026 and 2025, respectively. 8 Including changes in related party balances of $2.4 million and $3.5 million for the six months ended June 30, 2026 and 2025, respectively. 9 Including changes in related party balances of $0.1 million and $4.1 million for the six months ended June 30, 2026 and 2025, respectively. 10 Including changes in related party balances of $5.6 million for the six months ended June 30, 2026. There were no related party balances as of June 30, 2025, and December 31, 2024. 11 Represent related party investments in unconsolidated affiliates (see Note 7- Investments in Unconsolidated Affiliates in this Quarterly Report on Form 10-Q) . 12 Includes $0.1 million related party distributions received from unconsolidated affiliates for the six months ended June 30, 2026 (see Note 7- Investments in Unconsolidated Affiliates in this Quarterly Report on Form 10-Q) . 13 Represent related party consideration payable to customer's customer (see Note 3- Revenue Recognition in this Quarterly Report on Form 10-Q) . 14 Represents related party unfunded investment commitment pertaining to unconsolidated affiliates (see Note 7- Investments in Unconsolidated Affiliates in this Quarterly Report on Form 10-Q). The accompanying notes are an integral part of these condensed consolidated financial statements. Bloom Energy Corporation Notes to Unaudited Condensed Consolidated Financial Statements The unaudited condensed consolidated financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary for a fair presentation of the results for the interim periods presented. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements, including the notes thereto, included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the "2025 Form 10-K"). 1. Nature of Business, Liquidity and Basis of Presentation Nature of Business For information on the nature of our business, see Part II, Item 8, Note 1- Nature of Business, Liquidity and Basis of Presentation, section Nature of Business in our 2025 Form 10-K. Liquidity We generated $300.0 million of positive operating cash flow and $254.4 million of operating income for the six months ended June 30, 2026. With the series of convertible debt offerings, debt extinguishments, debt exchanges, and conversions of convertible debt to equity completed since 2021 , as of June 30, 2026, we had $2,475.4 million and $2.6 million of total outstanding recourse and non-recourse debt, respectively, $7.3 million and $2,470.7 million of which was classified as short-term debt and long-term debt, respectively. As of December 31, 2025, we had $2,613.7 million and $4.2 million of total outstanding recourse and non-recourse debt, respectively, $4.2 million and $2,613.7 million of which was classified as short-term debt and long-term debt, respectively. For information regarding our recent issuances of convertible debt, related exchange and extinguishment transactions, and our entry into a senior secured multicurrency revolving credit facility (the "Revolving Credit Facility"), refer to Part II, Item 8, Note 1- Nature of Business, Liquidity and Basis of Presentation, section Liquidity in our 2025 Form 10-K. Our future capital requirements depend on many factors, including the market acceptance of our products, our rate of revenue growth, the timing and extent of spending on research and development efforts and other business initiatives, the rate of growth in the volume of system builds and the need for additional working capital, the expansion of sales and marketing activities both in domestic and international markets, our ability to secure financing for customer use of our products, the timing of installations, inventory buildup and increase in factory capacity in anticipation of future sales and installations, and overall economic conditions. In order to support and achieve our future growth plans, we may need or seek advantageously to obtain additional funding through equity or debt financing. Failure to obtain this financing on favorable terms or at all in future quarters may affect our financial position and results of operations, including our revenues and cash flows. In the opinion of management, the combination of our cash and cash equivalents and cash flow to be generated by our operations is expected to be sufficient to meet our anticipated cash flow needs for at least the next 12 months from the date of the issuance of this Quarterly Report on Form 10-Q. The One Big Beautiful Bill Act For information on the One Big Beautiful Bill Act (the "OBBBA") signed into law on July 4, 2025, and its impact on our business, see Part II, Item 8, Note 1- Nature of Business, Liquidity and Basis of Presentation, section The One Big Beautiful Bill Act in our 2025 Form 10-K. Basis of Presentation We have prepared the condensed consolidated financial statements included herein pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC"), and as permitted by those rules, including all disclosures required by generally accepted accounting principles as applied in the U.S. ("U.S. GAAP"). Certain prior period amounts have been reclassified to conform to the current period presentation. Principles of Consolidation For information on the principles of consolidation, see Part II, Item 8, Note 1- Nature of Business, Liquidity and Basis of Presentation, section Principles of Consolidation in our 2025 Form 10-K. Use of Estimates For information on the use of accounting estimates, see Part II, Item 8, Note 1- Nature of Business, Liquidity and Basis of Presentation, section Use of Estimates in our 2025 Form 10-K. Concentration of Risk Geographic Risk- The majority of our revenue and long-lived assets are attributable to operations in the U.S. for all periods presented. In addition to shipments in the U.S., we also ship our Energy Server systems to other countries, primarily, the Republic of Korea, Japan, India and Taiwan (collectively referred to as the "Asia Pacific region"), and several European countries, namely Germany, UK and Italy. Revenue generated in the U.S. represented 90% of total revenue for both the three and six months ended June 30, 2026. For the three and six months ended June 30, 2025, revenue in the U.S. was 59% and 58%, respectively, of our total revenue. Credit Risk- As of June 30, 2026, three customers*, the third of which was our related party (see Note 11- Related Party Transactions in this Quarterly Report on Form 10-Q), accounted for approximately 36%, 34%, and 17% of accounts receivable. As of December 31, 2025, three customers*, the first of which was our related party (see Note 11- Related Party Transactions in this Quarterly Report on Form 10-Q), accounted for approximately 41%, 17%, and 15% of accounts receivable. To date, we have not experienced any material credit losses from these customers*. Customer Risk- During the six months ended June 30, 2026, revenue from two customers*, the second of which is our related party (see Note 11- Related Party Transactions in this Quarterly Report on Form 10-Q), accounted for approximately 44% and 21% of our total revenue. During the three months ended June 30, 2026, revenue from one customer*, which is not our related party, accounted for approximately 73% of our total revenue. During the three months ended June 30, 2025, four customers*, none of which are related parties, represented approximately 30%, 18%, 15%, and 11% of our total revenue. During the six months ended June 30, 2025, two customers*, neither of which are related parties, represented approximately 33% and 23% of our total revenue. *Definition of "customer." For purposes of the concentration of risk disclosure, "customer" refers to the contractual counterparty to which we sell our products and fulfil installation obligations, which in certain transactions may be a project-finance affiliate rather than the ultimate end user of the products. See Note 7- Investments in Unconsolidated Affiliates for additional information regarding the Brookfield-affiliated financing framework structure. 2. Summary of Significant Accounting Policies Refer to the accounting policies described in Part II, Item 8, Note 2- Summary of Significant Accounting Policies in our 2025 Form 10-K. Equity Method Accounting for Investments in Unconsolidated Affiliates The distribution rights and priorities set forth in the LLC agreements governing the unconsolidated affiliates differ from Bloom's underlying percentage ownership interests in those entities. Accordingly, we allocate income or loss from the unconsolidated affiliates using the hypothetical liquidation at book value ("HLBV") method, which is an acceptable application of the equity method of accounting under Accounting Standards Codification ("ASC") 323, Investments-Equity Method and Joint Ventures ("ASC 323") when contractual cash distribution provisions differ from stated ownership percentages. Due to the timing of receipt of the unconsolidated affiliates' financial information, we apply the equity method on a one-quarter reporting lag. Bloom monitors the unconsolidated affiliates for material intervening events during the lag period, and any such events are evaluated and, if necessary, disclosed or reflected in the current reporting period. Management believes that the use of this reporting lag is reasonable and does not materially affect our condensed consolidated results of operations. Under the HLBV method, at each reporting date, we calculate the amount we would receive if each unconsolidated affiliate were to liquidate all of its assets at their U.S. GAAP book values and distribute the resulting proceeds to creditors and members in accordance with the liquidation priorities set forth in the governing LLC agreement. Our share of income or loss from each unconsolidated affiliate for the period equals the change in our calculated liquidation claim between the beginning and end of the reporting period, adjusted for capital contributions and distributions during the period. The resulting equity method income or loss is presented as a single line item, Equity in earnings (loss) of unconsolidated affiliates , in our condensed consolidated statements of operations. Key inputs to the HLBV calculation include each unconsolidated affiliates' U.S. GAAP net income or loss, taxable income or loss, book and tax depreciation, Section 704(b) capital account balances, capital contributions and distributions, transferable investment tax credits, and target returns and liquidation priorities specified in the governing LLC agreements. Changes in any of these inputs could have a significant impact on the amount we would be entitled to receive upon a hypothetical liquidation and, consequently, on our equity in earnings or loss from the unconsolidated affiliates. Distributions Received From Unconsolidated Affiliates We use the "cumulative earnings" approach to classify distributions received from unconsolidated affiliates in our condensed consolidated statements of cash flows. Under this method, distributions received from unconsolidated affiliates are included in our condensed consolidated statements of cash flows as operating activities, unless cumulative distributions exceed our share of cumulative equity in the investee's net earnings. In such cases, the excess distributions are considered returns of investment and are classified as investing activities. For a complete discussion of our accounting policies, refer to Part II, Item 8, Note 2- Summary of Significant Accounting Policies in our 2025 Form 10-K. Recovery of Previously Paid Tariffs We account for potential recoveries of previously paid import tariffs by applying the loss recovery model by analogy to ASC 410-30, Asset Retirement and Environmental Obligations-Environmental Obligations ("ASC 410-30"). Consistent with ASC 410-30, which references the probability threshold in ASC 450-20, Loss Contingencies , we recognize a receivable for tariff refunds when recovery is deemed probable and the amount can be reasonably estimated. The recognized receivable is limited to the amount of tariff costs previously recognized in the condensed consolidated statements of operations. We do not recognize amounts in excess of such previously recognized costs. We evaluate the probability of recovery based on all available evidence, including the status of refund processes, legal developments, and our intent and ability to pursue claims. If recovery is not considered probable, no asset is recorded. We reassess this conclusion each reporting period. Recently Issued Accounting Pronouncements Accounting Guidance Not Yet Adopted In April 2026, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") 2026-01, Equity (Topic 505): Initial Measurement of Paid-in-Kind Dividends on Equity-Classified Preferred Stock ("ASU 2026-01"). This guidance requires entities to initially measure paid-in-kind ("PIK") dividends on equity-classified preferred stock based on the dividend rate specified in the related agreement applied to the instrument's liquidation preference. The amendments are intended to improve comparability by reducing diversity in practice related to the measurement of such dividends and do not affect the timing of recognition. The standard is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years, with early adoption permitted. The Company is evaluating ASU 2026-01 guidance and does not currently expect it to have a material impact on its condensed consolidated financial statements. In May 2026, the FASB issued ASU 2026-02, Environmental Credits and Environmental Credit Obligations (Topic 818) ("ASU 2026-02"). This guidance establishes a comprehensive model for the recognition, measurement, presentation, and disclosure of environmental credits and environmental credit obligations. The amendments are intended to improve comparability and transparency by reducing diversity in practice related to accounting for these arrangements. The standard is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, with early adoption permitted. The Company is evaluating ASU 2026-02 guidance and does not currently expect it to have a material impact on its condensed consolidated financial statements. Refer to the other accounting guidance not yet adopted described in Part II, Item 8, Note 2- Summary of Significant Accounting Policies, section Accounting Guidance Not Yet Adopted in our 2025 Form 10-K. Based on our ongoing evaluation, we do not expect the adoption of new accounting guidance to have a material impact on our condensed consolidated financial statements. Recently Released Accounting Standards Adopted by the Company In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities ("ASU 2025-10"). This update provides authoritative guidance on the recognition, measurement, and presentation of government grants received by business entities, an area previously lacking in U.S. GAAP. The amendments define government grants, establish recognition criteria, and require disclosures about the nature of grants, accounting policies applied, and significant terms and conditions. The amendments are effective for public business entities for annual periods beginning after December 15, 2028, with early adoption permitted. We elected to early adopt this standard as of January 1, 2026 (the beginning of our 2026 annual reporting period), using the modified prospective basis. We made an accounting policy election to account for nonrefundable, transferable tax credits related to assets as a government grant and present the credit separately as deferred income. The deferred income is amortized into Other Income, net over the useful life of the asset generating such credits. Consistent with this election, we account for the transferable tax credits generated from our investments in unconsolidated affiliates as part of our overall equity method pickup consistent with all other items of income or loss reported in the unconsolidated affiliates' financial statements. To the extent that the accounting policy for transferable tax credits is different from the unconsolidated affiliates, we will recast the unconsolidated affiliates' financial statements when calculating our equity method income or loss. There were no material impacts to our reported financial position, results of operations, or cash flows resulting from the adoption of this new accounting pronouncement. This standard has no impact on any prior periods presented in our condensed consolidated financial statements. In July 2025, the FASB issued ASU 2025-05, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets ("ASU 2025-05"). This update introduces a practical expedient for all entities when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under ASC 606, Revenue from Contracts with Customers ("ASC 606"). Under the practical expedient, when developing reasonable and supportable forecasts as part of estimating expected credit losses, an entity may assume that current conditions as of the balance sheet date do not change for the remaining life of the asset. ASU 2025-05 is effective for annual reporting periods beginning after December 15, 2025, including interim periods within those annual reporting periods. We adopted ASU 2025-05 in the first quarter of 2026. There were no material impacts to our reported financial position, results of operations, or cash flows resulting from the adoption of this new accounting pronouncement. 3. Revenue Recognition Contract Balances The following table provides information about accounts receivables, contract assets, customer deposits and deferred revenue from contracts with customers (in thousands): June 30, December 31, 2026 2025 Accounts receivable $ 458,126 $ 371,796 Contract assets 428,298 241,186 Customer deposits 360,568 78,207 Deferred revenue 84,478 65,608 Accounts receivable and contract assets increased by $86.3 million and $187.1 million, respectively, for the six months ended June 30, 2026, primarily due to the timing of billing milestones. The increase in customer deposits of $282.4 million for the six months ended June 30, 2026, was primarily driven by receipt of new deposits associated with recently executed customer agreements and milestone payments on ongoing projects, partially offset by certain deposits becoming non-refundable. For additional information on contract assets and liabilities, see Part II, Item 8, Note 3- Revenue Recognition, section Contract Balances in our 2025 Form 10-K. Contract Assets Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Beginning balance $ 305,876 $ 143,619 $ 241,186 $ 145,162 Transferred to accounts receivable from contract assets recognized at the beginning of the period (92,071) (63,017) (90,403) (85,069) Revenue recognized and not billed as of the end of the period 214,493 49,196 277,515 69,705 Ending balance $ 428,298 $ 129,798 $ 428,298 $ 129,798 Deferred Revenue Deferred revenue activity during the three and six months ended June 30, 2026 and 2025, consisted of the following (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Beginning balance $ 82,254 $ 59,008 $ 65,608 $ 66,304 Additions 672,440 321,035 1,300,441 530,920 Revenue recognized (670,216) (323,871) (1,281,571) (541,052) Ending balance $ 84,478 $ 56,172 $ 84,478 $ 56,172 For additional information on deferred revenue, see Part II, Item 8, Note 3- Revenue Recognition , section Deferred Revenue in our 2025 Form 10-K. As of June 30, 2026, and December 31, 2025, we have unsatisfied performance obligations of $442.4 million and $394.4 million, respectively, primarily related to product sales and installation services. We expect to recognize the associated revenue within the next 1 to 2 years, consistent with customers' project deployment schedules. In addition, as of June 30, 2026, and December 31, 2025, we had unsatisfied performance obligations of $51.7 million and $25.0 million, respectively, related mainly to deferred service contracts which we expect to recognize over the remaining contractual terms ranging from 1 to 25 years. We do not disclose the value of the unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. Disaggregated Revenue We disaggregate revenue from contracts with customers into four revenue categories: product, installation, service and electricity (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Revenue from contracts with customers: Product revenue $ 935,413 $ 296,611 $ 1,588,761 $ 508,480 Installation revenue 50,978 37,372 76,909 71,023 Service revenue 69,023 54,449 130,902 107,997 Electricity revenue 5,332 7,824 10,575 28,018 Total revenue from contract with customers 1,060,746 396,256 1,807,147 715,518 Revenue from contracts that contain leases: Electricity revenue 4,619 4,986 9,272 11,745 Total revenue $ 1,065,365 $ 401,242 $ 1,816,419 $ 727,263 Commitment to Issue Share-Based Consideration Payable to Customer's Customer On October 28, 2025, in connection with the partnership between the Company and Oracle Corporation ("Oracle") to provide on-site solid state power for AI data centers, subject to the negotiation of a warrant mutually acceptable to the Company and Oracle, we agreed to issue to Oracle a warrant (the "Warrant") to purchase up to an aggregate of 3,531,073 shares of common stock, with an exercise price of $113.28 per share, which was the closing market price on October 28, 2025. For additional details on the Warrant, see Part II, Item 8, Note 3- Revenue Recognition , section Commitment to Issue Share-Based Consideration Payable to Customer's Customer in our 2025 Form 10-K. On April 9, 2026 (the "Grant Date"), the Warrant was issued. The Warrant was fully vested upon issuance, immediately exercisable in whole or in part, at any time during the six months from the Grant Date and was classified as equity. Consistent with ASC 606 and ASC 718, Compensation-Stock Compensation ("ASC 718"), as clarified by ASU 2024-04, Debt-Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments , we remeasured the fair value of the Warrant as of the Grant Date. The fair value of the Warrant was determined using a Black-Scholes option pricing model in accordance with ASC 718's fair value measurement framework. The following weighted-average assumptions were used to estimate the fair value of the Warrant on April 9, 2026, and the commitment to issue the Warrant on December 31, 2025: April 9, December 31, 2026 2025 Risk-free interest rate 3.7% 3.6% Expected term (years) 0.5 0.5 Expected dividend yield - - Expected volatility 115.0% 96.2% As of the Grant Date and December 31, 2025, the estimated fair value of the Warrant and the commitment to issue the Warrant was $251.6 million and $55.9 million, respectively. Following the Grant Date, the fair value of the Warrant was fixed, and is accounted for as consideration payable to a customer's customer, recognized as a reduction of revenue as the underlying Energy Server systems sold under the Oracle arrangement are delivered. On May 1, 2026 (the "Exercise Date"), Oracle completed a cashless exercise of the Warrant, resulting in the issuance of 1,905,433 shares of our common stock. Under the terms of the warrant agreement, Oracle could elect either net or gross settlement. Because the net settlement would result in 1.4 million fewer shares being issued than a gross settlement, we agreed to issue Oracle an additional 248,798 shares of common stock as an inducement for Oracle to elect net settlement. These incremental shares represented additional consideration with a fair value of $72.3 million. As a result, the aggregate fair value of the shares issued upon exercise of the Warrant, including the incremental shares, was $324.4 million. Prior to the Grant Date, $12.9 million had been recognized in Additional Paid-in Capital . During the second quarter of 2026 we recorded an incremental $311.0 million to Additional Paid-in Capital , with corresponding debits to current and long-term Customer Consideration Asset of $91.0 million and $215.5 million, respectively, and revenue reduction of $5.0 million and $1.9 million for the three and six months ended June 30, 2026, respectively. Customer Consideration Asset represents upfront share-based consideration payable to a customer's customer and is amortized as a reduction of revenue as the underlying Energy Server systems sold under the Oracle arrangement are delivered. As of June 30, 2026, $17.9 million has been recognized on a cumulative basis as a reduction of revenue related to the Warrant. 4. Financial Instruments Cash, Cash Equivalents, and Restricted Cash The carrying values of cash, cash equivalents, and restricted cash approximate fair values and were as follows (in thousands): June 30, December 31, 2026 2025 As Held: Cash $ 469,707 $ 94,997 Money market funds 2,218,801 2,386,583 $ 2,688,508 $ 2,481,580 As Reported: Cash and cash equivalents $ 2,666,859 $ 2,454,108 Restricted cash 21,649 27,472 $ 2,688,508 $ 2,481,580 5. Fair Value Our accounting policy for the fair value measurement of cash equivalents and embedded Escalation Protection Plan ("EPP") derivatives is described in Part II, Item 8, Note 2- Summary of Significant Accounting Policies in our 2025 Form 10-K. Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis The tables below set forth, by level, our financial assets and liabilities that are accounted for at fair value for the respective periods. The table does not include assets and liabilities that are measured at historical cost or any basis other than fair value (in thousands): Fair Value Measured at Reporting Date Using June 30, 2026 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 2,218,801 $ - $ - $ 2,218,801 Liabilities Derivatives: Embedded EPP derivatives $ - $ - $ 4,899 $ 4,899 Fair Value Measured at Reporting Date Using December 31, 2025 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 2,386,583 $ - $ - $ 2,386,583 Liabilities Derivatives: Embedded EPP derivatives $ - $ - $ 5,607 $ 5,607 The changes in the Level 3 financial liabilities during the six month ended June 30, 2026, were as follows (in thousands): Embedded EPP Derivative Liability Liabilities at December 31, 2025 $ 5,607 EPP liability settlement (493) Changes in fair value (215) Liabilities at June 30, 2026 $ 4,899 In March 2026, according to an EPP agreement with one of our customers, we paid $0.5 million, which was recorded as a reduction to our balance of embedded EPP derivative liability as of June 30, 2026. For additional information on money market funds and EPP derivatives, see Part II, Item 8, Note 5- Fair Value, section Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis in our 2025 Form 10-K. Financial Assets and Liabilities and Other Items Not Measured at Fair Value on a Recurring Basis Debt Instruments- The term loans and convertible senior notes are based on rates currently offered for instruments with similar maturities and terms (Level 2). The following table presents the estimated fair values and carrying values of debt instruments (in thousands): June 30, 2026 December 31, 2025 Net Carrying Value Fair Value Net Carrying Value Fair Value Debt instruments Recourse: 0% Convertible Senior Notes due November 2030 1 $ 2,447,915 $ 4,622,764 $ 2,442,091 $ 2,140,536 3.0% Green Convertible Senior Notes due June 2029 1 26,697 355,528 73,473 313,740 3.0% Green Convertible Senior Notes due June 2028 1 778 10,524 98,162 456,764 Non-recourse: 4.6% Term Loan due October 2026 2,583 2,888 2,769 3,009 4.6% Term Loan due April 2026 $ - $ - $ 1,384 $ 1,550 1 The increase in fair value primarily reflects the rise in the Company's stock price. 6. Balance Sheet Components Inventories The components of inventory consisted of the following (in thousands): June 30, December 31, 2026 2025 Raw materials $ 451,117 $ 351,757 Work-in-progress 83,031 125,036 Finished goods 224,040 166,513 $ 758,188 $ 643,306 The inventory reserves were $32.5 million and $39.3 million as of June 30, 2026, and December 31, 2025, respectively. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): June 30, December 31, 2026 2025 Project-related equity investment 1 $ 50,000 $ - Tariff refund receivable 2 32,389 - Vendor advances 3 32,109 750 Receivables from employees 4 22,411 2,507 Tax receivables 7,639 4,509 Prepaid hardware and software maintenance 6,816 6,327 Interest receivable 5,919 6,029 Prepaid deferred commissions 3,789 3,049 Prepaid managed services 3,510 4,705 Prepaid rent 1,840 60 Prepaid corporate insurance 1,666 5,182 Deferred expenses 819 1,559 Prepaid medical insurance 532 232 Deposits made 336 376 Prepaid workers compensation 221 796 Other prepaid expenses and other current assets 12,142 13,724 $ 182,138 $ 49,805 1 Represents consideration paid to acquire an option to purchase a 100% ownership interest in the shares of an unaffiliated third-party entity associated with a customer project arrangement. The investment is accounted for under ASC 321, Investments in Equity Securities . We expect to transfer or otherwise realize the asset within the next three months through related assignment or reimbursement arrangements and we do not expect to retain an equity or other long-term ownership interest in the underlying project or project entity. 2 As of June 30, 2026, we had identified approximately $37.4 million of recoverable import tariffs previously paid under the International Emergency Economic Powers Act ("IEEPA"), all of which had been recognized in Cost of product revenue . Approximately $5.0 million of such amounts had been refunded as of June 30, 2026. Bloom concluded that recovery of the remaining $32.4 million was probable and reasonably estimable and, accordingly, recognized a tariff refund receivable for that amount. The receivable is limited to tariff costs previously recognized in earnings and reflects management's assessment of recoverable amounts based on the status of claims and other information available as of the reporting date. Our estimate of recoverable amounts is based on currently available information, including the status of claims and applicable refund procedures. The ultimate amount and timing of recoveries may differ from the amounts recorded due to uncertainties in the refund process and potential legal or administrative developments. 3 Vendor advances increased primarily due to advance payments made to certain suppliers under commercial arrangements related to future purchases of goods and services. 4 Receivables from employees increased primarily due to higher commission advances associated with increased sales bookings. Property, Plant and Equipment, Net Property, plant and equipment, net consisted of the following (in thousands): June 30, December 31, 2026 2025 Vehicles, machinery and equipment $ 222,483 $ 203,731 Energy Server systems 143,843 165,629 Construction-in-progress 140,360 83,067 Leasehold improvements 132,818 129,665 Buildings 53,751 53,156 Computers, software and hardware 36,301 34,761 Furniture and fixtures 11,225 11,090 740,781 681,099 Less: accumulated depreciation (297,393) (282,592) $ 443,388 $ 398,507 Depreciation expense related to property, plant and equipment was $13.7 million and $27.0 million for the three and six months ended June 30, 2026, respectively. Depreciation expense related to property, plant and equipment was $12.6 million and $24.6 million for the three and six months ended June 30, 2025, respectively. Other Long-Term Assets Other long-term assets consisted of the following (in thousands): June 30, December 31, 2026 2025 Vendor advances 1 $ 111,374 $ 17,374 Deferred commissions 22,122 19,109 Deferred expenses 7,769 8,111 Deferred financing costs 3,310 3,412 Deposits made 2,373 3,001 Deferred tax asset 1,872 1,780 Long-term lease receivable 1,845 2,193 Prepaid managed services 1,315 1,316 Prepaid and other long-term assets 1,762 907 $ 153,742 $ 57,203 1 Vendor advances increased primarily due to advance payments made to certain suppliers under commercial arrangements related to future purchases of goods and services. Accrued Warranty and Product Performance Liabilities Accrued warranty and product performance liabilities consisted of the following (in thousands): June 30, December 31, 2026 2025 Product performance $ 16,790 $ 16,791 Product warranty 1 61,007 3,222 $ 77,797 $ 20,013 Changes in the product warranty and product performance liabilities were as follows (in thousands): Balances at December 31, 2025 $ 20,013 Accrued warranty, net 1 and product performance liabilities 71,630 Product performance expenditures during the period (13,846) Balances at June 30, 2026 $ 77,797 1 Includes a specific warranty reserve of $58.3 million, which is accounted for as an assurance-type warranty and recognized within cost of product revenue. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): June 30, December 31, 2026 2025 General invoice and purchase order accruals $ 169,290 $ 76,909 Compensation and benefits 75,920 97,571 Accrued installation 28,315 14,278 Sales-related liabilities 18,005 12,031 Sales tax liabilities 6,774 10,054 Accrued legal expenses 4,842 2,599 Interim VAT liability 2,087 281 Provision for income tax 2,050 2,115 Unfunded investment commitment (Note 11) 1,438 - Accrued consulting expenses 1,430 1,475 Finance lease liability 1,351 1,370 Deferred profit in transactions with unconsolidated affiliates 1,022 - Accrued restructuring costs 889 482 Current portion of derivative liabilities 846 1,353 Interest payable 729 913 Other 931 823 $ 315,919 $ 222,254 Pre ferred Stock As of June 30, 2026, and December 31, 2025 , we had 20,000,000 shares of preferred stock authorized, with a par value of $0.0001 per share. There were no shares of preferred stock issued or outstanding as of June 30, 2026, and December 31, 2025. 7. Investments in Unconsolidated Affiliates The Company and Brookfield Asset Management ("Brookfield") have entered into joint venture structures which are housed in an AI Infrastructure Fund created by Brookfield (the "AI Fund"). For details, see Part II, Item 8, Note 7- Investments in Unconsolidated Affiliates in our 2025 Form 10-K. We account for each investment in both the AI Fund JVs and JVs outside the AI Fund (the "Other JVs") (collectively, the "Fund JVs") as an investment under the equity method of accounting in accordance with ASC 323. The AI Fund and Brookfield hold the remaining ownership interests and serve as the primary beneficiaries; accordingly, both the AI Fund JVs and the Other JVs are not consolidated by us. As of June 30, 2026, and December 31, 2025, we hold equity interests in the following Fund JVs: June 30, December 31, 2026 2025 AI Fund JVs Bolt US Class A JVCo LLC 9.9% 9.9% Bolt US JVCo LLC 9.9% 9.9% Other JVs ORC HoldCo LLC 15.0% 15.0% Our maximum exposure to loss from the involvement with the Fund JVs as of June 30, 2026 is $68.8 million. This amount consists of: (i) the carrying amount of our equity investments, totaling $28.1 million, (ii) remaining unfunded capital commitments of $20.2 million, and (iii) deferred profit related to sales to the Fund JVs of $20.6 million. Our total capital commitment to the Fund JVs as of June 30, 2026 is $77.3 million. For details related to our maximum exposure to loss from the involvement with the Fund JVs and our capital commitments, see Part II, Item 8, Note 7- Investments in Unconsolidated Affiliates in our 2025 Form 10-K. Our share of income or loss from each Fund JV for the period represents the change in our calculated liquidation claim from the beginning to the end of the reporting period, adjusted for capital contributions and distributions made during the period. The resulting equity-method income or loss is presented as a single line item, Equity in earnings (loss) of unconsolidated affiliates , in our condensed consolidated statements of operations. We record our share of profit from sales of our products to the Fund JVs as a reduction of equity in earnings (loss) of unconsolidated affiliates. This share of profit reduces the carrying amount of our investments in unconsolidated affiliates. To the extent the cumulative reduction of equity in earnings (loss) of unconsolidated affiliates exceed the investment's carrying amount, the excess is presented as either Deferred profit in transactions with unconsolidated affiliates , or Accrued expenses and other current liabilities , based on the expected timing of realization. The deferred profit reverses (increasing equity in earnings (loss) of unconsolidated affiliates and restoring the investment balance) as profit is realized over the remaining useful life through depreciation of the underlying assets. As of June 30, 2026, and December 31, 2025, the deferred profit balances were $20.6 million and $13.9 million, of which $19.6 million and $13.9 million were classified as a noncurrent liability, respectively. During the six months ended June 30, 2026, we recognized $12.7 million of equity-method losses from unconsolidated affiliates. Of this amount, $14.0 million related to the elimination of intra-entity profit on asset sales in accordance with ASC 323, which will be recognized over the useful lives of the underlying assets as they are depreciated, and $1.3 million related to the allocation of losses from the Fund JVs under the HLBV method. Changes in the investment balance for the six months ended June 30, 2026, were as follows (in thousands): Balances at December 31, 2025 $ 10,037 Current period investment in unconsolidated affiliates 24,234 Equity in loss of unconsolidated affiliates (12,656) Cash distributions received (140) Deferred profit in transactions with unconsolidated affiliates 5,632 Accrued expenses and other current liabilities 983 Balances at June 30, 2026 $ 28,090 Management evaluates each investment in each of the Fund JVs for impairment in accordance with ASC 323. No indicators of impairment were identified related to the investments as of June 30, 2026, and December 31, 2025. 8. Outstanding Loans and Security Agreements The following is a summary of our debt as of June 30, 2026 (in thousands, except percentage data): Unpaid Principal Balance Net Carrying Value Interest Rate Maturity Dates Entity Current Long- Term Total 0% Convertible Senior Notes due November 2030 $ 2,500,000 $ - $ 2,447,915 $ 2,447,915 0.0% November 2030 Company 3.0% Green Convertible Senior Notes due June 2029 26,971 3,908 22,789 26,697 3.0% June 2029 Company 3.0% Green Convertible Senior Notes due June 2028 787 778 - 778 3.0% June 2028 Company Total recourse debt 2,527,758 4,686 2,470,704 2,475,390 4.6% Term Loan due October 2026 2,583 2,583 - 2,583 4.6% October 2026 Korean JV Total non-recourse debt 2,583 2,583 - 2,583 Total debt $ 2,530,341 $ 7,269 $ 2,470,704 $ 2,477,973 The following is a summary of our debt as of December 31, 2025 (in thousands, except percentage data): Unpaid Principal Balance Net Carrying Value Interest Rate Maturity Dates Entity Current Long- Term Total 0% Convertible Senior Notes due November 2030 $ 2,500,000 $ - $ 2,442,091 $ 2,442,091 0.0% November 2030 Company 3.0% Green Convertible Senior Notes due June 2029 75,125 - 73,473 73,473 3.0% June 2029 Company 3.0% Green Convertible Senior Notes due June 2028 99,655 - 98,162 98,162 3.0% June 2028 Company Total recourse debt 2,674,780 - 2,613,726 2,613,726 4.6% Term Loan due October 2026 2,769 2,769 - 2,769 4.6% October 2026 Korean JV 4.6% Term Loan due April 2026 1,384 1,384 - 1,384 4.6% April 2026 Korean JV Total non-recourse debt 4,153 4,153 - 4,153 Total debt $ 2,678,933 $ 4,153 $ 2,613,726 $ 2,617,879 Recourse debt refers to debt that we have an obligation to pay. Non-recourse debt refers to debt that is recourse to only our subsidiary, Bloom SK Fuel Cell, LLC, a joint venture in the Republic of Korea with SK ecoplant (the "Korean JV"). The differences between the unpaid principal balances and the net carrying values reflect unamortized deferred financing costs, including the initial purchasers' discounts, where applicable, and premiums or discounts associated with our debt, if any. We and all of our subsidiaries were in compliance with all financial covenants as of June 30, 2026, and December 31, 2025. Recourse Debt Facilities 0% Convertible Senior Notes due November 2030 ( "the 0% Notes") 3.0% Green Convertible Senior Notes due June 2029 ( "the 3.0% Green Notes due June 2029") 3.0% Green Convertible Senior Notes due June 2028 ( "the 3.0% Green Notes due June 2028") Issuance date/Indenture date 1 November 4, 2025 May 29, 2024 May 16, 2023 Aggregate principal amount issued $2,500.0 million $402.5 million $632.5 million Initial purchasers' discount 2 $50.0 million $12.1 million $15.8 million Other issuance costs 2 $9.9 million $0.7 million $3.9 million Net proceeds received $2,440.1 million $389.7 million $612.8 million Due date 3 November 15, 2030 June 1, 2029 June 1, 2028 Greenshoe option 4 $300.0 million $52.5 million $82.5 million Senior, unsecured obligations Yes Yes Yes Interest rate and payment schedule Do not bear regular interest and will not accrete in principal amount over time 3.0% per annum, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2024 3.0% per annum, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2023 Redemption date 5 November 20, 2028 June 7, 2027 June 5, 2026 Conversion date 6 August 15, 2030 7 March 1, 2029 7 March 1, 2028 7 Conversion trigger quarter-end date 6 March 31, 2026 8 September 30, 2024 8 September 30, 2023 8 Initial conversion rate, shares of common stock per $1,000 principal amount of notes 9 5.1290 47.9795 53.0427 Initial conversion price, per share of common stock 9 $194.97 $20.84 $18.85 Incremental shares under Make-Whole Fundamental Change 10 , shares of common stock per $1,000 principal amount 9 2.6926 15.5932 22.5430 The maximum number of shares into which the notes could have been potentially converted if the conversion features were triggered: as of June 30, 2026 19,554,000 1,714,619 59,486 as of December 31, 2025 19,554,000 4,775,899 7,532,493 Effective interest rate 0.5% 1.1% 4.2% Customary provisions relating to the occurrence of Events of Default See footnote 11 See footnote 11 See footnote 11 Classification of net carrying value in condensed consolidated balance sheets. as of June 30, 2026 Long-term liability Short- and Long-term liability Short-term liability as of December 31, 2025 Long-term liability Long-term liability Long-term liability 1 Issued pursuant to, and are governed by, an indenture, between us and U.S. Bank Trust Company, National Association, as Trustee, in private placements to qualified institutional buyers pursuant to Rule 144A of the Securities Act of 1933, as amended. 2 The notes' initial purchasers' discount and other issuance costs (collectively, the "Transaction Costs") were recorded as debt issuance costs and presented a reduction to the notes on our condensed consolidated balance sheets and are amortized to interest expense at an effective interest rate. 3 Unless earlier repurchased, redeemed or converted. 4 Pursuant to the purchase agreement among us and the representatives of the initial purchasers, we granted the initial purchasers an option to purchase an additional aggregate principal amount of the notes. Notes included specified aggregate principal amount pursuant to the full exercise by the initial purchasers of the Greenshoe option. 5 We may not redeem the notes prior to the specified redemption date, subject to a partial redemption limitation. We may elect to redeem, at face value, all or any portion of the notes at any time, and from time to time, on or after the specified redemption date, and on or before the twenty-first (for the 0% Notes and the 3.0% Green Notes due June 2029), or the forty-sixth (for the 3.0% Green Notes due June 2028) scheduled trading day immediately before the maturity date, provided the share price for our common stock exceeds 130% of the conversion price at redemption. 6 Before the specified conversion date, the noteholders have the right to convert their notes only upon the occurrence of certain events, including satisfaction of a condition relating to the closing price of our common stock (the "Closing Price Condition") or the trading price of the notes (the "Trading Price Condition"), a redemption event, or other specified corporate events. If the Closing Price Condition is met on at least 20 (whether or not consecutive) of the last 30 consecutive trading days in any calendar quarter, and only during such calendar quarter, the noteholders may convert their notes at any time during the immediately following quarter, commencing after the calendar quarter ending on the specified date (i.e., conversion trigger quarter-end date), subject to the partial redemption limitation. 7 Subject to the Trading Price Condition, the noteholders may convert their notes during the five consecutive business days immediately after any ten consecutive trading day period (for the 0% Notes) or the five business days immediately after any five consecutive trading day period (for the 3.0% Green Notes due June 2029 and the 3.0% Green Notes due June 2028, collectively referred to as the "Green Notes") in which the trading price per $1,000 principal amount of the notes, as determined following a request by a holder of the notes, for each day of that period is less than 98% of the product of the closing price of our common stock and the then applicable conversion rate. From and after the specified conversion date, the noteholders may convert their notes at any time at their election until the close of business on the second scheduled trading day immediately before the maturity date. Should the noteholders elect to convert their notes, we may elect to settle the conversion by paying or delivering, as applicable, cash, shares of our common stock, $0.0001 par value per share, or a combination thereof, at our election. Please refer to Part II, Item 8, Note 8- Outstanding Loans and Security Agreements , section Induced Conversions of the Existing Notes in our 2025 Form 10-K for details of the conversion of the 3.0% Green Notes due June 2029 and the 3.0% Green Notes due June 2028 in the fourth quarter of the fiscal year 2025. 8 The Closing Price Condition for the 3.0% Green Notes due June 2029 and the 3.0% Green Notes due June 2028 was met during the three months ended March 31, 2026, and accordingly, such noteholders could convert their notes during the quarter ended June 30, 2026 (see section Conversions of the Green Notes below). The Closing Price Condition for the 0% Notes was not met during the three months ended March 31, 2026, and accordingly, such noteholders could not convert their notes during the quarter ended June 30, 2026. 9 The conversion rate and conversion price are subject to customary adjustments upon the occurrence of certain events. Also, we may increase the conversion rate at any time if our Board of Directors determines it is in the best interests of the Company or to avoid or diminish income tax to holders of common stock. In addition, if certain corporate events that constitute a Make-Whole Fundamental Change, occur, then the conversion rate applicable to the conversion of the notes will, in certain circumstances, increase by up to the specified incremental shares of common stock per $1,000 principal amount of notes for a specified period of time. 10 Make-Whole Fundamental Change means (i) a Fundamental Change, that includes certain change-of-control events relating to us, certain business combination transactions involving us and certain delisting events with respect to our common stock, or (ii) the sending of a redemption notice with respect to the notes. 11 The notes contain certain customary provisions relating to the occurrence of Events of Default, as defined in the underlying indentures. If an Event of Default involving bankruptcy, insolvency or reorganization events with respect to us occurs, then the principal amount of, and all accrued and unpaid interest (regular interest, where applicable, special interest or additional interest, if any) on all of the notes then outstanding will immediately become due and payable without any further action or notice by any person. However, notwithstanding the foregoing, we may elect, at our option, that the sole remedy for an Event of Default relating to certain failures by us to comply with certain reporting covenants in the underlying indentures consists exclusively of the right of the noteholders to receive special interest for up to 360 days (on the 0% Notes) or up to 180 days (on the Green Notes) at a specified rate per annum not exceeding 0.5% on the principal amount of the notes. The total interest expense recognized related to our notes for the three and six months ended June 30, 2026 and 2025, comprised of contractual interest expense and amortization of debt issuance costs, was as follows (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Contractual interest expense 0% Convertible Senior Notes due November 2030 $ - $ - $ - $ - 3.0% Green Convertible Senior Notes due June 2029 542 3,481 1,105 6,500 3.0% Green Convertible Senior Notes due June 2028 738 4,744 1,159 9,488 2.5% Green Convertible Senior Notes due August 2025 - 351 - 1,069 $ 1,280 $ 8,576 $ 2,264 $ 17,057 Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Amortization of the initial purchasers' discount and other issuance costs 0% Convertible Senior Notes due November 2030 $ 2,976 $ - $ 5,953 $ - 3.0% Green Convertible Senior Notes due June 2029 111 765 232 1,399 3.0% Green Convertible Senior Notes due June 2028 100 979 244 1,958 2.5% Green Convertible Senior Notes due August 2025 - 120 - 366 $ 3,187 $ 1,864 $ 6,429 $ 3,723 Total interest expense related to our notes 0% Convertible Senior Notes due November 2030 $ 2,976 $ - $ 5,953 $ - 3.0% Green Convertible Senior Notes due June 2029 653 4,246 1,337 7,899 3.0% Green Convertible Senior Notes due June 2028 838 5,723 1,403 11,446 2.5% Green Convertible Senior Notes due August 2025 - 471 - 1,435 $ 4,467 $ 10,440 $ 8,693 $ 20,780 To date, there have been no events necessitating the recognition of special interest expense related to our notes. The amount of unamortized debt issuance costs of our notes as of June 30, 2026, and December 31, 2025, was as follows (in thousands): June 30, December 31, 2026 2025 Unamortized debt issuance costs 0% Convertible Senior Notes due November 2030 $ 52,085 $ 57,909 3.0% Green Convertible Senior Notes due June 2029 274 1,652 3.0% Green Convertible Senior Notes due June 2028 10 1,493 $ 52,369 $ 61,054 Capped Calls Please refer to Part II, Item 8, Note 8- Outstanding Loans and Security Agreements, section Capped Calls in our 2025 Form 10-K for discussion of privately negotiated capped call transactions in connection with the pricing of the 3.0% Green Notes due June 2028. Conversions of the Green Notes During the six months ended June 30, 2026, the Green Notes became eligible for conversion after the satisfaction of the Closing Price Condition specified in the underlying indentures for such notes. During the six months ended June 30, 2026, holders elected to convert approximately $147.0 million aggregate principal amount of the Green Notes. Under the conversion provisions of the respective indentures for the Green Notes, and consistent with our obligation to settle conversions in cash, shares of common stock, or a combination thereof, we issued 6,676,924 shares of common stock during the period. As of June 30, 2026, an additional 877,687 shares of common stock related to converted Green Notes had not yet been issued and remained unsettled. Following the conversions, the outstanding carrying value of the 3.0% Green Notes due June 2028 and 3.0% Green Notes due June 2029 decreased by $97.6 million and $47.0 million, respectively. As a result, we recognized $144.6 million in Additional paid-in capital in our condensed consolidated balance sheets. The impact on other line items within our condensed consolidated balance sheets and our condensed consolidated statements of operations was not material. No gain or loss was recognized in connection with the conversions. We will continue to assess conversion eligibility each fiscal quarter in accordance with the conditions described in the Indentures governing the Green Notes. Redemption of the 3.0% Green Notes due June 2028 On June 9, 2026, we issued a notice of redemption (the "Redemption Notice") for all the remaining outstanding 3.0% Green Notes due June 2028 pursuant to the indenture dated May 16, 2023 governing such notes (the "Indenture"). The redemption date was scheduled for July 10, 2026 (the "Redemption Date"). In accordance with the terms of the Indenture, holders had the right to convert their notes at any time from the date of the Redemption Notice until the close of business on the business day immediately preceding the Redemption Date. Any notes not converted would be redeemed for cash at a price equal to 100% of the principal amount, plus accrued and unpaid interest, if any, to, but excluding, the Redemption Date. Revolving Credit Facility On December 19, 2025, we entered into a senior secured multicurrency Revolving Credit Facility in an aggregate available amount of $600.0 million, including a letter of credit sub-facility of up to $90.0 million (the "Revolving Credit Facility"). For details, see Part II, Item 8, Note 8- Outstanding Loans and Security Agreements, section Revolving Credit Facility in our 2025 Form 10-K. As of June 30, 2026, and December 31, 2025, no amounts were drawn under the facility. As of June 30, 2026, $90.0 million of standby letters of credit had been issued under the facility, reducing available borrowings to $510.0 million. The total interest expense recognized related to the Revolving Credit Facility for the three and six months ended June 30, 2026 and 2025, represented by deferred financing costs amortization, was as follows (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Amortization of deferred financing costs $ 184 $ - $ 367 $ - The amount of unamortized deferred financing costs of the Revolving Credit Facility as of June 30, 2026, and December 31, 2025, was as follows (in thousands): June 30, December 31, 2026 2025 Unamortized deferred financing costs $ 3,310 $ 3,412 Deferred financing costs are included within Other long-term assets on our condensed consolidated balance sheets. We are subject to financial covenants, including minimum interest coverage and maximum leverage ratios, and Bloom was in compliance with all covenants as of June 30, 2026, and December 31, 2025. Proceeds of borrowings under the Revolving Credit Facility may be used for working capital, capital expenditures, permitted acquisitions, and other general corporate purposes. We have not triggered any springing maturity provisions under the Revolving Credit Facility as of the date of the issuance of this Quarterly Report on Form 10-Q. The facility provides enhanced liquidity for general corporate purposes, including strategic initiatives. Non-recourse Debt Facilities For discussion of our non-recourse debt, refer to Part II, Item 8, Note 8- Outstanding Loans and Security Agreements, section Non-recourse Debt Facilities in our 2025 Form 10-K. On April 11, 2026, the non-recourse 4.6% Term Loan due April 2026 of the Korean JV with an outstanding principal balance of $1.3 million was repaid. The repayment did not result in any gain or loss. Repayment Schedule and Interest Expense The following table presents details of our outstanding loan principal repayment schedule as of June 30, 2026 (in thousands): Remainder of 2026 $ 7,370 2027 - 2028 - 2029 22,971 2030 2,500,000 2031 - Thereafter - $ 2,530,341 For the three and six months ended June 30, 2026, interest expense of $8.9 million and $17.5 million, respectively, including total interest expense related to our debt of $4.6 million and $8.8 million, respectively, was recorded in Interest expense on our condensed consolidated statements of operations. For the three and six months ended June 30, 2025, interest expense of $14.4 million and $28.9 million, respectively, including total interest expense related to our debt of $10.5 million and $20.9 million, respectively, was recorded in Interest expense on our condensed consolidated statements of operations. 9. Leases Facilities, Energy Server Systems, and Vehicles For the three and six months ended June 30, 2026, rent expenses for all occupied facilities were $4.4 million and $9.8 million, respectively. For the three and six months ended June 30, 2025, rent expenses for all occupied facilities were $5.3 million and $10.5 million, respectively. Operating and financing lease right-of-use assets and lease liabilities as of June 30, 2026, and December 31, 2025, were as follows (in thousands): June 30, December 31, 2026 2025 Operating Leases: Operating lease right-of-use assets, net 1, 2 $ 106,475 $ 108,541 Current operating lease liabilities (23,094) (22,000) Non-current operating lease liabilities (102,730) (106,935) Total operating lease liabilities (125,824) (128,935) Finance Leases: Finance lease right-of-use assets, net 2, 3, 4 4,432 4,932 Current finance lease liabilities 5 (1,351) (1,370) Non-current finance lease liabilities 6 (3,395) (3,848) Total finance lease liabilities (4,746) (5,218) Total lease liabilities $ (130,570) $ (134,153) 1 These assets primarily include leases for facilities, Energy Server systems, and vehicles. 2 Net of accumulated amortization. 3 These assets primarily include leases for vehicles. 4 Included in property, plant and equipment, net in the condensed consolidated balance sheets. 5 Included in accrued expenses and other current liabilities in the condensed consolidated balance sheets. 6 Included in other long-term liabilities in the condensed consolidated balance sheets. The components of our lease costs for the three and six months ended June 30, 2026 and 2025, were as follows (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Operating lease costs $ 8,223 $ 8,019 $ 16,332 $ 15,923 Financing lease costs: Amortization of right-of-use assets 732 214 756 391 Interest on lease liabilities 109 89 226 171 Total financing lease costs 841 303 982 562 Short-term lease costs 1 (553) 607 55 1,237 Total lease costs $ 8,511 $ 8,929 $ 17,369 $ 17,722 1 The negative amount reflects the reclassification of certain lease-related costs to restructuring expenses in connection with a facility closure. Weighted average remaining lease terms and discount rates for our leases as of June 30, 2026, and December 31, 2025, were as follows: June 30, December 31, 2026 2025 Weighted average remaining lease term: Operating leases 5.7 years 6 years Finance leases 3.6 years 3.8 years Weighted average discount rate: Operating leases 10.4 % 10.5 % Finance leases 9.0 % 9.0 % Future lease payments under lease agreements as of June 30, 2026, were as follows (in thousands): Operating Leases Finance Leases Remainder of 2026 $ 17,237 $ 867 2027 35,119 1,664 2028 29,913 1,376 2029 23,279 1,061 2030 21,192 529 2031 15,302 9 Thereafter 28,058 - Total minimum lease payments 170,100 5,506 Less: amounts representing interest or imputed interest (44,276) (760) Present value of lease liabilities $ 125,824 $ 4,746 For additional information on leases, see Part II, Item 8, Note 9- Leases, section Facilities, Energy Server Systems, and Vehicles in our 2025 Form 10-K. Managed Services Financing For details on Managed Services Financing, refer to Part I, Item 7, section Purchase and Financing Options, sub-section Legacy Financing Structure for Managed Services and Part II, Item 8, Note 9- Leases, section Managed Services Financing in our 2025 Form 10-K. There were no new successful sale-and-leaseback transactions for the three and six months ended June 30, 2026 and 2025. The recognized operating lease expenses from legacy successful sale-and-leaseback transactions for the three and six months ended June 30, 2026, were $3.4 million and $6.7 million, respectively. The recognized operating lease expenses from legacy successful sale-and-leaseback transactions for the three and six months ended June 30, 2025, were $3.4 million and $6.8 million, respectively. Operating lease right-of-use assets from legacy successful sale-and-leaseback transactions as of June 30, 2026, and December 31, 2025, were $34.6 million and $39.0 million, respectively. Operating lease liabilities from legacy successful sale-and-leaseback transactions as of June 30, 2026, and December 31, 2025, were $37.8 million and $42.2 million, including long-term operating lease liability of $27.9 million and $32.9 million, respectively. Financing obligations from legacy successful sale-and-leaseback transactions as of June 30, 2026, and December 31, 2025, were $7.7 million and $8.9 million, including long-term financing obligations of $5.1 million and $6.5 million, respectively. As of June 30, 2026, future lease payments under the Managed Services Agreements financing obligations were as follows (in thousands): Financing Obligations Remainder of 2026 $ 11,237 2027 17,930 2028 12,270 2029 7,642 2030 5,889 2031 4,063 Thereafter 9,944 Total minimum lease payments 68,975 Less: imputed interest (30,821) Present value of net minimum lease payments 38,154 Less: current financing obligations (9,115) Long-term financing obligations $ 29,039 The total financing obligations, as reflected in our condensed consolidated balance sheets, were $206.5 million and $243.8 million as of June 30, 2026, and December 31, 2025, respectively. We expect the difference between these obligations and the principal obligations in the table above to be offset against the carrying value of the related Energy Server systems at the end of the lease and the remainder recognized as either a net gain or net loss at that point. For the three and six months ended June 30, 2026, we recognized $4.1 million and $13.5 million net gain on failed sale-and-leaseback transactions, respectively, in Other income, net on our condensed consolidated statements of operations. There were no net loss or net gain on failed sale-and-leaseback transactions for the three and six months ended June 30, 2025. 10. Stock-Based Compensation and Employee Benefit Plans Share-based grants are designed to reward employees for their long-term contributions to us and provide incentives for them to remain with us. 2012 Equity Incentive Plan Under our 2012 Equity Incentive Plan (the "2012 Plan"), as of June 30, 2026, and December 31, 2025, stock options to purchase 1,672,079 and 2,110,523 shares of common stock were outstanding with a weighted average exercise price of $25.58 and $25.67 per share, respectively, and no shares were available for future grant. The 2012 Plan has been canceled but continues to govern outstanding option grants under the 2012 Plan. 2018 Equity Incentive Plan Under the 2018 Equity Incentive Plan (the "2018 Plan"), as of June 30, 2026, and December 31, 2025, stock options to purchase 3,337,688 and 3,925,002 shares of common stock were outstanding, respectively, with a weighted average exercise price of $10.46 and $10.15 per share, respectively. As of June 30, 2026, and December 31, 2025, 10,101,219 and 12,292,948 restricted stock units ("RSUs") and performance stock units ("PSUs") that may be settled for common stock, which were granted pursuant to the 2018 Plan, respectively, were outstanding. As of June 30, 2026, and December 31, 2025, we had 51,053,994 and 39,709,996 shares reserved for issuance under the 2018 Plan, respectively. For details on our Equity Incentive Plans, refer to Part II, Item 8, Note 10- Stock-Based Compensation and Employee Benefit Plans, sections 2012 Equity Incentive Plan and 2018 Equity Incentive Plan in our 2025 Form 10-K. Stock-Based Compensation Expense The following table summarizes the components of stock-based compensation expense in the condensed consolidated statements of operations (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Cost of revenue $ 9,675 $ 5,714 $ 20,080 $ 10,543 Research and development 13,034 7,913 26,192 15,740 Sales and marketing 14,424 5,320 27,888 9,830 General and administrative 19,269 11,230 39,246 26,266 $ 56,402 $ 30,177 $ 113,406 $ 62,379 For the three and six months ended June 30, 2026 and 2025, stock-based compensation expense capitalized on inventory and deferred cost of goods sold was not material. Stock Option and Stock Award Activity Stock Options The following table summarizes the stock option activity under our stock plans during the reporting period: Outstanding Options Number of Shares Weighted Average Exercise Price Remaining Contractual Life (Years) Aggregate Intrinsic Value (in thousands) Balances at December 31, 2025 5,741,283 $ 15.92 4.5 $ 406,957 Exercised (800,297) 18.43 PSOs adjustment 69,027 - Forfeited / Expired (246) 30.96 Balances at June 30, 2026 5,009,767 15.54 4.4 1,427,979 Vested and expected to vest at June 30, 2026 4,825,745 15.69 4.3 1,385,040 Exercisable at June 30, 2026 3,666,393 $ 17.40 3.1 $ 1,046,020 During the three and six months ended June 30, 2026, we recognized $1.2 million and $2.5 million of stock-based compensation costs for stock options, respectively. During the three and six months ended June 30, 2025, we recognized $1.2 million and $2.6 million of stock-based compensation costs for stock options, respectively. No stock options were granted during the three and six months ended June 30, 2026. and three months ended June 30, 2025. During the six months ended June 30, 2025, we granted 100,000 stock options, represented by performance-based stock options ("PSOs") issued to a non-executive employee. PSOs have a 10-year term, an exercise price equal to the fair market value of our common stock on the date of grant, and vest either at the end of three-year performance period, or over a three - or four-year requisite service period. We used the following weighted-average assumptions in applying the Black-Scholes valuation model for determination of the stock options valuation: Six Months Ended June 30, 2025 Risk-free interest rate 4.1% Expected term (years) 6.1 Expected dividend yield - Expected volatility 93.4% During the three and six months ended June 30, 2026, the intrinsic value of stock options exercised were $106.2 million and $155.4 million, respectively. During the three and six months ended June 30, 2025, the intrinsic value of stock options exercised were $1.9 million and $3.1 million, respectively. As of June 30, 2026, and December 31, 2025, we had unrecognized compensation costs related to unvested stock options of $3.3 million and $5.1 million, respectively. This cost is expected to be recognized over the remaining weighted-average period of 0.8 years and 1.3 years, respectively. Cash received from stock options exercised totaled $7.3 million and $15.1 million for the three and six months ended June 30, 2026, respectively. Cash received from stock options exercised totaled $0.1 million and $1.3 million for the three and six months ended June 30, 2025, respectively. Stock Awards A summary of our stock awards activity and related information is as follows: Number of Awards Outstanding Weighted Average Grant Date Fair Value Unvested Balance at December 31, 2025 12,292,948 $ 25.74 Granted 1,142,215 177.23 Vested (3,032,439) 19.72 Forfeited (301,505) 30.19 Unvested Balance at June 30, 2026 10,101,219 $ 44.54 The estimated fair value of RSUs and PSUs is based on the fair market value of our common stock on the date of grant. For the three and six months ended June 30, 2026, we recognized $45.0 million and $88.2 million of stock-based compensation costs for stock awards, respectively. For the three and six months ended June 30, 2025, we recognized $25.9 million and $54.7 million of stock-based compensation costs for stock awards, respectively. As of June 30, 2026, and December 31, 2025, we had $401.1 million and $277.1 million of unrecognized stock-based compensation expense related to unvested stock awards, expected to be recognized over a weighted-average period of 1.8 years and 2.0 years, respectively. Executive Awards The Company granted awards under the 2018 Plan to certain executive officers during 2026. On June 15, 2026, the Company granted PSUs to its Chief Executive Officer (the "CEO Award"). The CEO Award vests in full at the end of a 3.5-year performance period (cliff vesting), subject to the achievement of specified annual performance targets and the CEO's continued employment through the vesting date. Any shares issued upon vesting and settlement of the CEO Award, net of shares withheld to satisfy applicable tax withholding obligations, will be subject to a mandatory post-vesting holding period and generally may not be sold, transferred, assigned, pledged, hypothecated or otherwise disposed of prior to December 31, 2031, subject to certain limited exceptions. Stock-based compensation expense for the CEO Award is recognized over the 3.5-year performance period based on the Company's current estimate of the likelihood of achieving the applicable performance targets. On May 20, 2026, the Company granted PSUs and RSUs to its newly appointed Chief Financial Officer and one other executive officer. On February 25, 2026, the Company granted PSUs and RSUs to certain other executive officers (collectively, the "2026 Executive Awards"). The RSUs are subject to service-based vesting. For the Chief Financial Officer, one-third of the RSUs vest on April 15, 2027, and the remaining two-thirds vest in equal quarterly installments over the following two years. For certain other executive officers, 40% of the RSUs vest on March 1, 2027, and the remaining 60% vest in equal quarterly installments over the subsequent two years. The PSUs included in the 2026 Executive Awards vest in full at the end of a three-year performance period (cliff vesting), subject to the achievement of specified annual performance targets and the executive's continued employment through the vesting date. Stock-based compensation expense for the RSUs is recognized over the requisite service period based on the service-based vesting terms, while expense for the PSUs is recognized over the applicable three-year performance period based on the Company's current estimate of the likelihood of achieving the applicable performance targets. For details on the 2021-2025 Executive Awards and the Replacement Awards, refer to Part II, Item 8, Note 10- Stock-Based Compensation and Employee Benefit Plans, section Executive Awards in our 2025 Form 10-K. The unamortized compensation expense for the 2021-2026 Executive Awards, the CEO Award, and the Replacement Awards was as follows (in millions): June 30, December 31, 2026 2025 2026 Executive Awards and the CEO Award $ 106.0 $ - 2025 Executive Awards 14.1 19.9 2024 Executive Awards and the Replacement Awards 56.5 77.4 2023 Executive Awards 0.2 0.6 2022 Executive Awards 0.1 0.3 2021 Executive Awards - 0.6 Plan Shares Available for Grant The following table presents the stock activity and the total number of shares available for grant under our stock plans: Plan Shares Available for Grant Balances at December 31, 2025 39,709,996 Added to plan 11,934,957 Granted (1,124,673) Cancelled/Forfeited 534,027 Balances at June 30, 2026 51,053,994 2018 Employee Stock Purchase Plan For details on the 2018 Employee Stock Purchase Plan (the "2018 ESPP"), refer to Part II, Item 8, Note 10- Stock-Based Compensation and Employee Benefit Plans, section 2018 Employee Stock Purchase Plan in our 2025 Form 10-K. During the three and six months ended June 30, 2026, we recognized $5.4 million and $9.7 million of stock-based compensation costs for the 2018 ESPP, respectively. During the three and six months ended June 30, 2025, we recognized $2.1 million and $4.5 million of stock-based compensation costs for the 2018 ESPP, respectively. We issued 644,651 and 630,607 shares for the six months ended June 30, 2026 and 2025, respectively. During the six months ended June 30, 2026 and 2025, we added an additional 2,983,739 and 2,494,717 shares, respectively. There were 20,333,033 and 17,993,945 shares available for issuance as of June 30, 2026, and December 31, 2025, respectively. As of June 30, 2026, and December 31, 2025, we had $15.4 million and $8.6 million of unrecognized stock-based compensation costs, expected to be recognized over a weighted average period of 0.6 years and 0.6 years, respectively. We used the following weighted-average assumptions in applying the Black-Scholes valuation model for determination of the 2018 ESPP share valuation: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Risk-free interest rate 3.4%-3.6% 4.2%-4.3% 3.4%-4.1% 4.1%-5.0% Expected term (years) 0.5-2.0 0.5-2.0 0.5-2.0 0.5-2.0 Expected dividend yield - - - - Expected volatility 96.7%-110.4% 81.5%-115.2% 80.5%-110.4% 66.2%-115.2% 11. Related Party Transactions There have been no changes in related party relationships during the three and six months ended June 30, 2026. Our operations include the following related party transactions (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Total revenue from related parties 1 $ 2,818 $ 27,077 $ 376,081 $ 29,860 General and administrative expenses 2 - 198 - 371 Interest expense 3 - 49 - 96 Equity in (earnings) loss of unconsolidated affiliates 4 (4,346) - 12,656 - 1 Includes total revenue related to (a) the Fund JVs and (b) SK ecoplant, which was a related party from September 23, 2023 through July 10, 2025. 2 Includes rent expenses per operating lease agreements entered between Korean JV and SK ecoplant and miscellaneous expenses billed by SK ecoplant to Korean JV. 3 Interest expense per two term loans entered into between Korean JV and SK ecoplant in fiscal year 2023 (see Part II, Item 8, Note 8- Outstanding Loans and Security Agreements , section Non-recourse Debt Facilities in our 2025 Form 10-K). 4 Represent equity in (earnings) loss of the Fund JVs. Cash distributions from the Fund JVs during the six months ended June 30, 2026, were $0.1 million. Cash distributions from the Fund JVs during the three months ended June 30, 2026, were inconsequential (see Note 7- Investments in Unconsolidated Affiliates in this Quarterly Report on Form 10-Q). Below is the summary of outstanding related party balances as of June 30, 2026, and December 31, 2025 (in thousands): June 30, December 31, 2026 2025 Accounts receivable $ 76,092 $ 151,932 Contract assets, current 43,861 2,967 Customer consideration asset, current 1 90,967 - Prepaid expenses and other current assets - 1,247 Investments in unconsolidated affiliates 28,090 10,037 Contract assets, non-current 47,224 48,763 Customer consideration asset, non-current 1 215,533 - Other long-term assets - 5,968 Accrued warranty 8,571 799 Accrued expenses and other current liabilities 2 2,460 39 Deferred revenue and customer deposits, current 6,992 6,879 Deferred profit in transactions with unconsolidated affiliates 19,560 13,928 1 See Note 3 - Revenue Recognition - Commitment to Issue Share-Based Consideration Payable to Customer's Customer in this Quarterly Report on Form 10-Q for additional information. 2 Includes an unfunded investment commitment of $1.4 million related to the Fund JVs and $1.0 million of excess of unrealized profit from sales to the Fund JVs over the carrying value of the related equity-method investments (see Note 7- Investments in Unconsolidated Affiliates in this Quarterly Report on Form 10-Q). SK ecoplant Joint Venture For information on SK ecoplant Joint Venture, see Part II, Item 8, Note 12- Related Party Transactions , section SK ecoplant Joint Venture in our 2025 Form 10-K. The following are the aggregate carrying values of the Korean JV's assets and liabilities in our condensed consolidated balance sheets, after eliminations of intercompany transactions and balances, as of June 30, 2026, and December 31, 2025 (in thousands): June 30, December 31, 2026 2025 Assets Current assets: Cash and cash equivalents $ 8,333 $ 25,820 Accounts receivable 18,265 576 Inventories 18,977 33,075 Prepaid expenses and other current assets 15,517 5,688 Total current assets 61,092 65,159 Property and equipment, net 1,204 1,454 Operating lease right-of-use assets 847 1,134 Other long-term assets 302 210 Total assets $ 63,445 $ 67,957 June 30, December 31, 2026 2025 Liabilities Current liabilities: Accounts payable $ 10,183 $ 16,342 Accrued expenses and other current liabilities 38,391 19,179 Operating lease liabilities 513 516 Non-recourse debt 2,583 4,153 Total current liabilities 51,670 40,190 Operating lease liabilities 186 484 Total liabilities $ 51,856 $ 40,674 12. Commitments and Contingencies Commitments Purchase Commitments with Suppliers and Contract Manufacturers- As of June 30, 2026, we had non-cancelable purchase commitments of $16.4 million with component suppliers and third-party manufacturers, which are expected to be fulfilled beyond the next 12 months. As of December 31, 2025, we had no non-cancelable purchase commitments with component suppliers and third-party manufacturers, which are expected to be fulfilled beyond the next 12 months. For additional information on purchase commitments with suppliers and contract manufacturers, see Part II, Item 8, Note 13- Commitments and Contingencies, section Commitments in our 2025 Form 10-K. Performance Guarantees- We paid $5.4 million and $13.8 million for the three and six months ended June 30, 2026, respectively, and $3.0 million and $14.6 million for the three and six months ended June 30, 2025, respectively, for guarantees that we provide customers on the output performance of our Energy Server systems. For additional information on performance guarantees, see Part II, Item 8, Note 13- Commitments and Contingencies, section Commitments in our 2025 Form 10-K. Letters of Credit- We have outstanding letters of credit issued to our customers and other counterparties in the U.S. and international locations under different performance and financial obligations. These letters of credit are collateralized through cash deposited in the controlled bank accounts with the issuing banks and are classified as Restricted Cash in our condensed consolidated balance sheets. As of June 30, 2026, and December 31, 2025, the balances of the cash-collateralized letters of credit issued to our customers and other counterparties in the U.S. and international locations were $20.9 million and $26.6 million, respectively. In April 2026, we issued in the ordinary course of business additional standby letters of credit totaling $100.0 million, including $90.0 million issued under our Revolving Credit Facility and $10.0 million issued through other arrangements, each with an expiration date of April 1, 2027. Pledged Funds- In 2019, pursuant to the PPA IIIb repowering of the Energy Server systems, we established a restricted cash fund of $20.0 million, which had been pledged for a seven-year period to secure our operations and maintenance obligations with respect to the totality of our obligations to the financier. These funds will be released to us by the end of 2026 as long as the Energy Server systems continue to perform in compliance with our warranty obligations. As of June 30, 2026, and December 31, 2025, the balance of the r...

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