Aqua Metals, Inc. Annual Report - How They Did This Year

I’ve put together this guide to help you understand how Aqua Metals performed this year. Instead of digging through dense financial filings, we will look at how the business is running, how they spend money, and the major risks you should know.

1. What does this company do?

Aqua Metals is a "green" refinery. They use a proprietary technology called "AquaRefining" to recover metals like lithium, nickel, and cobalt from old batteries using electricity instead of high-heat furnaces. They are currently scaling their Sierra ARC facility in Nevada to turn battery waste into usable metal products. They also plan to acquire Lion Energy, a company that makes energy storage systems. This would shift their business from simple recycling to a broader energy storage and supply chain provider.

2. Financial Health: Still No Revenue

The most important point is that Aqua Metals generated no revenue from operations in 2024 or 2025. They are still in the research and development phase, spending money to build infrastructure rather than making sales.

• The "Going Concern" Warning: Auditors have flagged "substantial doubt" about the company’s ability to stay in business. While they ended 2025 with $10.8 million in cash (up from $4.1 million in 2024), this came from selling old equipment and issuing more shares, not from business profits.
• The Dilution Problem: The company spends $2.5 million to $3.0 million every month. To pay for this, they sell more shares. In 2025, they sold over 836,000 shares to raise $1.5 million. Every time they create new shares to cover expenses, your percentage of ownership in the company shrinks.
• Debt Update: They paid off their long-term debt in 2025. While this removes interest payments, it leaves the company entirely dependent on selling more shares to fund its future.

3. Warrants and Stock Compensation

The company issues "warrants," which are coupons that let investors buy stock at a set price later. There are over 1.1 million warrants exercisable at $11.34 until 2030. If the stock price rises above that, these will be exercised, creating new shares and further reducing your ownership stake.

The company also pays staff with stock instead of cash. In 2025, they issued many "Restricted Stock Units," costing the company $2.8 million in non-cash expenses. While this saves cash, it increases the total number of shares. Recently, executives canceled some performance-based stock awards because they missed certain goals, a move intended to limit further dilution.

4. The Big Bet: Lion Energy

Aqua Metals is trying to pivot by acquiring Lion Energy. This is a high-stakes gamble. They have already spent over $4 million on this deal, including a $2 million loan to Lion Energy. If the deal fails, that money is likely lost. If it succeeds, the company will likely need to raise more money, which will almost certainly mean issuing even more shares.

5. New Risks: The "Reality Check"

• Stock Splits: Be careful when looking at historical charts. The company performed a 1-for-20 reverse split in 2024 and a 1-for-10 reverse split in 2025. These moves were meant to keep the stock price above the $1.00 Nasdaq requirement. These splits make the share price look higher, but they do not change the company’s value or its lack of revenue.
• Volatility: The stock price is highly unstable due to the speculative nature of the technology, the lack of revenue, and the constant need to sell more shares. News about the Lion Energy merger or the Nevada facility will likely cause large price swings.

Future Outlook

The company is at a crossroads. Their future depends on integrating Lion Energy and reaching commercial scale in Nevada. If they cannot raise more money or if the Lion Energy deal fails, the company may be unable to continue operations. Before investing, consider whether you are comfortable with a company that relies entirely on issuing new shares to fund its survival rather than generating its own profit.