ORIGINCLEAR, INC. Annual Report - How They Did This Year

I’m writing this guide to help you understand OriginClear’s performance. My goal is to turn complex filings into a simple conversation so you can decide if this company fits your investment goals.

1. What does this company do?

OriginClear acts as an innovation hub for the water industry. Their main business, Progressive Water Treatment (PWT) in McKinney, Texas, builds custom water systems for industrial clients.

They are shifting toward a "Water-as-a-Service" (WaaS) model. Instead of just selling equipment, they want to own the systems and charge clients per gallon, like a utility. This aims to create steady, long-term income rather than one-time sales.

2. Financial performance: The "Going Concern" Warning

PWT grew revenue by 55%, reaching about $5.4 million. However, the company’s overall health remains fragile.

• Persistent Losses: The company is not profitable. They reported a $13.6 million loss in 2025. While this is better than the $19 million loss in 2024, they still spend more cash than they bring in.
• The "Going Concern" Flag: Auditors included a "going concern" warning. This means the company may not have enough cash—often less than $500,000—to pay its bills for the next year without finding more funding.
• Debt: They owe over $2.6 million, mostly in convertible notes. These loans have high interest rates. Lenders can swap this debt for shares at a discount, which creates more shares and reduces your ownership percentage.

3. Major wins and challenges

• Manufacturing Efficiency: They are buying high-end tools like CNC waterjets for their McKinney facility. This reduces reliance on outside fabricators and aims to improve profit margins.
• Strategic Pivot: They stopped their "Modular Water Systems" division because it didn't scale. They are now focusing entirely on the WaaS model.
• Blockchain Exit: They abandoned the "WaterChain" initiative and their $H2O trademark. This confirms their business does not rely on blockchain, ending a confusing phase of their history.

4. Key risks: What could hurt your investment?

• Dilution: With over 16 billion shares authorized, the stock trades for a fraction of a penny. The company often issues new shares to pay off debt. This cycle makes it very hard for the share price to rise.
• Dependence on Key People: The company relies heavily on CEO T. Riggs Eckelberry and Ken Berenger. They lack formal contracts or insurance for these leaders. If they leave, the company loses its core leadership.
• The "Bitcoin" Gamble: They invested in Bitcoin mining rigs in Texas. This is a risky distraction from their water business and has yet to prove it can be profitable.

5. Future outlook

Management is betting on the WaaS model, targeting $10 million in yearly recurring revenue. They believe aging water infrastructure will force businesses to treat water on-site. However, they need significant cash to buy the equipment required to scale. Without a major influx of funding or a surge in profitable contracts, the company remains at high risk of running out of money.

Final Thought for Investors: When looking at OriginClear, the core question is whether the "Water-as-a-Service" model can scale fast enough to overcome their current debt and cash flow issues. Because the company is currently relying on share issuance to stay afloat, it is important to weigh the potential of their water technology against the reality of the significant dilution and financial instability mentioned in their filings.