0001819438False00018194382023-11-072023-11-070001819438wk:CommonStock0.0001ParValuePerShareMember2023-11-072023-11-070001819438wk:WarrantsEachWholeWarrantExercisableForOneShareOfCommonStockAtAnExercisePriceOf11.50Member2023-11-072023-11-07

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): November 7, 2023
ESS TECH, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware001-3952598-1550150
(State or other jurisdiction
of incorporation)
(Commission
File Number)
(I.R.S. Employer
Identification Number)
26440 SW Parkway Ave., Bldg. 83
Wilsonville, Oregon
 97070
(Address of principal executive offices) (Zip code)
(855) 423-9920
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading
Symbol(s)
Name of each exchange
on which registered
Common Stock, $0.0001 par value per shareGWHThe New York Stock Exchange
Warrants, each whole warrant exercisable for one share of common stock at an exercise price of $11.50GWH.WThe New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02    Results of Operations and Financial Condition.
On November 7, 2023, ESS Tech, Inc. (the “Company”) issued a press release announcing financial results for the quarter ended September 30, 2023. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
The information furnished in this Item 2.02 and Exhibit 99.1 of this Current Report on Form 8-K shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.
Item 9.01    Financial Statements and Exhibits
(d) Exhibits
Exhibit
No.
 
99.1
104Cover page interactive data file


SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
Dated: November 7, 2023
ESS TECH, INC.
By:/s/ Anthony Rabb
Name:Anthony Rabb
Title:Chief Financial Officer


Exhibit 99.1
esslogo.jpg
ESS Tech, Inc. Announces Third Quarter 2023 Financial Results
Announced Strategic Partnership with Honeywell

WILSONVILLE, Ore. – November 7, 2023 – ESS Tech, Inc. (“ESS,” “ESS, Inc.” or the “Company”) (NYSE: GWH), a leading manufacturer of long-duration energy storage systems for commercial and utility-scale applications, today announced financial results for its third quarter ended September 30, 2023.
“In the third quarter, ESS again made significant progress executing on improving our internal operations, commissioning units at existing customer sites, strengthening our balance sheet, and broadening customer traction. This progress with our customers and operations is reflected in our year to date revenue of $4.7 million, which is an increase of nearly 700% from last year. I’m also pleased to share that we successfully completed commissioning of a number of Energy Warehouses, including the six we delivered to Sacramento Municipal Utility District last quarter,” said Eric Dresselhuys, CEO of ESS.
“Worldwide demand for reliable, safe, energy storage technology is growing rapidly and is reflected in the solid customer demand we’re seeing in the market. We continue to expect a material increase in revenue in the fourth quarter, which should lead to $9 million in revenue for the full year. Furthermore, our transformative partnership with Honeywell serves as a tremendous validation of the unique value proposition of our iron flow battery and our position in the market. The collaboration between ESS and Honeywell will not only strengthen our technology, operations and go-to-market, but the cash infusion from Honeywell also bolsters our balance sheet and extends our cash runway well into 2025. In addition, we’re well underway in building our first Energy Center with Portland General Electric and expect it to be operational this year, which should translate to shipping commercial units in the second half of 2024. Combined, these drivers in our business positions ESS for long-term growth and profitability expansion.”
Recent Business Highlights
•In September 2023, ESS entered into a strategic collaboration with Honeywell to advance technology development and market adoption of iron flow battery energy storage systems. Honeywell has made an investment in ESS as part of this collaboration, adding $42.5 million to our balance sheet, and will incorporate ESS technology in their clean energy go-to-market efforts, with an initial target to purchase $300 million of ESS product in the coming years. ESS will also integrate Honeywell’s flow-battery IP with its own extensive IP portfolio.
•ESS is finalizing its agreement with LEAG, a major German energy provider, for the first phase of their multi-year project targeting commissioning in 2027 to build a 500 MWh iron flow battery system at the LEAG Boxberg Power Plant site in Germany. This installation, when complete, will create a repeatable building block to support LEAG’s objective to create up to 20GWh of storage to be paired with solar and local hydrogen production, creating the largest green-energy hub in Europe.
•In Q3, ESS completed commissioning of six Energy Warehouse™ systems that were delivered to the Sacramento Municipal Utility District (SMUD) last quarter for the first phase of our relationship to support SMUD’s 2030 Zero Carbon Plan. As previously announced, ESS has agreed to supply up to 2 GWh of long-duration energy storage over the next four years in the form of Energy Warehouses™ and Energy Centers™. As part of this multi-year agreement, ESS also intends to set up facilities for battery system assembly, operations and maintenance support and project delivery in Sacramento, creating local, high-paying jobs. In addition, ESS and SMUD plan to team up with local colleges and universities to establish a


Center of Excellence to expand and train the workforce that will be needed to support long-duration energy storage technology.
•In September 2023, ESS was awarded an Export Achievement Certificate by the United States Department of Commerce for expanding global deployment of its American-made, innovative long-duration energy storage technology. The Export Achievement Certificate is presented by the U.S. Department of Commerce to American companies making significant contributions to exports. Exports of ESS’ iron flow battery systems have increased significantly over the past year as global demand for long-duration energy storage continues to grow.
•In August 2023, Stanwell Corporation, a major electricity generator owned by the Queensland government, and Energy Storage Industries Asia Pacific (ESI), our Australian partner, unveiled an initial iron flow battery energy storage system pilot project at the Stanwell Power Station. Subsequently, in October, the Premier of Queensland announced that the state government plans to expand this project to a 150 MW installation and Stanwell has taken an option to purchase up to 200 MW of storage per year thereafter.
•On August 17, 2023 Jeff Loebbaka was named Chief Commercial Officer of ESS.
•On August 29, 2023, ESS announced the appointment of Harry Quarls to its Board of Directors as Chairman. Michael Niggli, the ESS Founding Board Chairman, will remain on the board to assist with this transition. Harry Quarls has over four decades of energy experience and brings considerable strategic, financial, transactional, and energy investing experience to ESS.
Conference Call Details
ESS will hold a webcast conference call on Tuesday, November 7, 2023 at 5:00 p.m. EST to discuss financial results for its third quarter 2023 ended September 30, 2023. Interested parties may join the conference call beginning at 5:00 p.m. EST on Tuesday, November 7, 2023 via telephone by calling (833) 927-1758 in the U.S., or for international callers, by calling +1 (929) 526-1599 and entering conference ID 307911. A telephone replay will be available until November 14, 2023, by dialing (866) 813-9403 in the U.S., or for international callers, +44 (204) 525-0658 with conference ID 679393. A live webcast of the conference call will be available on ESS’ Investor Relations website at http://investors.essinc.com/.
A replay of the call will be available via the web at http://investors.essinc.com/.
About ESS, Inc.
At ESS (NYSE: GWH), our mission is to accelerate global decarbonization by providing safe, sustainable, long-duration energy storage that powers people, communities and businesses with clean, renewable energy anytime and anywhere it’s needed. As more renewable energy is added to the grid, long-duration energy storage is essential to providing the reliability and resiliency we need when the sun is not shining and the wind is not blowing.
Our technology uses earth-abundant iron, salt and water to deliver environmentally safe solutions capable of providing up to 12 hours of flexible energy capacity for commercial and utility-scale energy storage applications. Established in 2011, ESS enables project developers, independent power producers, utilities and other large energy users to deploy reliable, sustainable long-duration energy storage solutions. For more information visit www.essinc.com.
Energy Warehouses and Energy Centers are trademarks of ESS Tech, Inc. Any third-party trademarks are property of their respective owners and any usage herein does not suggest or imply any relationship between ESS and the third party unless expressly stated.
Use of Non-GAAP Financial Measures
In this press release and the accompanying earnings call, the Company includes Non-GAAP Operating Expenses and Adjusted EBITDA, which are non-GAAP performance measures that the Company uses to supplement its results presented in accordance with U.S. GAAP. As required by the rules of the Securities and Exchange Commission (“SEC”), the Company has provided herein a reconciliation of the non-GAAP financial measures contained in this press release and the accompanying earnings call to the most directly comparable measures under GAAP. The Company’s management believes Non-GAAP Operating Expenses and Adjusted EBITDA are useful in


evaluating its operating performance and are similar measures reported by publicly-listed U.S. companies, and regularly used by securities analysts, institutional investors, and other interested parties in analyzing operating performance and prospects. By providing these non-GAAP measures, the Company’s management intends to provide investors with a meaningful, consistent comparison of the Company’s profitability for the periods presented. Adjusted EBITDA is not intended to be a substitute for net income/loss or any U.S. GAAP financial measure and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry. Further, Non-GAAP Operating Expenses are not intended to be a substitute for GAAP Operating Expenses or any U.S. GAAP financial measure and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry.
The Company defines and calculates Non-GAAP Operating Expenses as GAAP Operating Expenses adjusted for stock-based compensation and other special items determined by management as they are not indicative of business operations. The Company defines and calculates Adjusted EBITDA as net loss before interest, other non-operating expense or income, (benefit) provision for income taxes, and depreciation, and further adjusted for stock-based compensation and other special items determined by management, including, but not limited to, fair value adjustments for certain financial liabilities associated with debt and equity transactions as they are not indicative of business operations.
Forward-Looking Statements
This communication contains certain forward-looking statements, including statements regarding ESS and its management team’s expectations, hopes, beliefs, intentions or strategies regarding the future. The words “anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”, “intends”, “may”, “might”, “plan”, “possible”, “potential”, “predict”, “project”, “should”, “will” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Examples of forward-looking statements include, among others, statements regarding revenue expectations, the Company’s manufacturing plans, the Company’s order and sales pipeline, the Company’s ability to execute on orders, the Company’s ability to effectively manage costs, and the Company’s partnerships with third parties such as Honeywell, LEAG, ESI and Sacramento Municipal Utility District. These forward-looking statements are based on ESS’ current expectations and beliefs concerning future developments and their potential effects on ESS. Many factors could cause actual future events to differ materially from the forward-looking statements in this communication. There can be no assurance that the future developments affecting ESS will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond ESS’s control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements, which include, but are not limited to, continuing supply chain issues; delays, disruptions, or quality control problems in the Company’s manufacturing operations; the Company’s ability to hire, train and retain an adequate number of manufacturing employees; issues related to the shipment and installation of the Company’s products; issues related to customer acceptance of the Company’s products; issues related to the Company’s partnerships with third parties; inflationary pressures; risk of loss of government funding for customer projects; and the Company’s need to achieve significant business growth to achieve sustained, long-term profitability; as well as those risks and uncertainties set forth in the section entitled “Risk Factors” in the Company’s Quarterly Report on Form 10-Q for the nine months ended September 30, 2023, to be filed with the SEC on November 14, 2023, and its other filings filed with the SEC. Except as required by law, ESS is not undertaking any obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.
Contacts
Investors:
Erik Bylin
investors@essinc.com
Media:
Morgan Pitts
+1 (503) 568-0755


Morgan.Pitts@essinc.com

Source: ESS Tech, Inc.



ESS Tech, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Loss
(unaudited)
(in thousands, except share and per share data)
 
Three Months Ended September 30,
Nine Months Ended September 30,
 2023202220232022
Revenue:
Revenue$1,544 $191 $4,741 $595 
Revenue - related parties1 1 3 $283 
Total revenue1,545 192 4,744 $878 
Cost of revenue10,183 — 10,183 — 
Gross profit (loss)(8,638)192 (5,439)878 
Operating expenses:
Research and development1,609 20,127 38,790 49,190 
Sales and marketing2,056 1,815 5,648 5,217 
General and administrative5,831 5,981 16,963 20,567 
Total operating expenses9,496 27,923 61,401 74,974 
Loss from operations(18,134)(27,731)(66,840)(74,096)
Other income (expenses), net:
Interest income, net1,155 781 3,737 999 
Gain (loss) on revaluation of common stock warrant liabilities344 (4,585)917 20,515 
Other income (expense), net17 (62)738 (312)
Total other income (expenses), net1,516 (3,866)5,392 21,202 
Net loss and comprehensive loss to common stockholders$(16,618)$(31,597)$(61,448)$(52,894)
Net loss per share - basic and diluted$(0.11)$(0.21)$(0.40)$(0.35)
Weighted-average shares used in per share calculation - basic and diluted157,076,260 152,861,300 155,377,648 152,427,346 


ESS Tech, Inc.
Condensed Consolidated Balance Sheets
(unaudited)
(in thousands, except share data)
 September 30, 2023 December 31, 2022
Assets 
Current assets: 
Cash and cash equivalents$37,173  $34,767 
Restricted cash, current1,373  1,213 
Accounts receivable, net1,265 4,952 
Short-term investments87,329 105,047 
Inventory2,256 — 
Prepaid expenses and other current assets2,035  5,657 
Total current assets131,431  151,636 
Property and equipment, net17,986  17,570 
Intangible assets, net4,990 — 
Operating lease right-of-use assets2,485 3,401 
Restricted cash, non-current945  675 
   Other non-current assets824 271 
Total assets$158,661  $173,553 
Liabilities and stockholders' equity 
Current liabilities: 
Accounts payable$3,192  $3,036 
Accrued and other current liabilities9,846  14,125 
Accrued product warranties2,636 1,643 
Operating lease liabilities, current1,541 1,421 
Deferred revenue1,424 6,168 
Notes payable, current—  1,600 
Total current liabilities18,639  27,993 
Notes payable, non-current—  315 
Operating lease liabilities, non-current1,365 2,535 
Deferred revenue, non-current19,905 2,442 
Common stock warrant liabilities2,292 3,209 
Other non-current liabilities—  85 
Total liabilities42,201  36,579 
Stockholders' equity: 
Preferred stock ($0.0001 par value; 200,000,000 shares authorized, none issued and outstanding as of September 30, 2023 and December 31, 2022)
—  — 
Common stock ($0.0001 par value; 2,000,000,000 shares authorized, 173,007,592 and 153,821,339 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively)
18  16 
Additional paid-in capital796,469  755,537 
Accumulated deficit(680,027) (618,579)
Total stockholders' equity116,460  136,974 
Total liabilities and stockholders' equity$158,661  $173,553 


ESS Tech, Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited)
(in thousands)
Nine Months Ended September 30,
20232022
Cash flows from operating activities:
Net loss$(61,448)$(52,894)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization3,187 828 
Non-cash interest income(2,438)(527)
Non-cash lease expense916841 
Stock-based compensation expense7,673 8,703 
Inventory write-downs and losses on noncancellable purchase commitments11,422 — 
Change in fair value of common stock warrant liabilities(917)(20,515)
Other non-cash (income) expenses, net(34)306 
Changes in operating assets and liabilities:
Accounts receivable, net3,874 437 
Inventory(13,132)— 
Prepaid expenses and other assets3,701 1,497 
Accounts payable275 (1,604)
Accrued and other current liabilities(4,305)5,525 
Accrued product warranties993 1,148 
Deferred revenue12,532 (117)
Operating lease liabilities(1,050)(248)
Net cash used in operating activities(38,751)(56,620)
Cash flows from investing activities:
Purchases of property and equipment(4,209)(11,186)
Maturities and purchases of short-term investments, net20,208 (123,467)
Net cash provided by (used in) investing activities15,999 (134,653)
Cash flows from financing activities:
Proceeds from issuance of common stock and common stock warrants, net of issuance costs27,132 — 
Payments on notes payable(1,733)(1,500)
Proceeds from stock options exercised236 102 
Proceeds from contributions to Employee Stock Purchase Plan332 — 
Repurchase of shares from employees for income tax withholding purposes(165)(2,808)
Other, net(214)(15)
Net cash provided by (used in) financing activities25,588 (4,221)
Net change in cash, cash equivalents and restricted cash2,836 (195,494)
Cash, cash equivalents and restricted cash, beginning of period36,655 240,232 
Cash, cash equivalents and restricted cash, end of period$39,491 $44,738 




ESS Tech, Inc.
Condensed Consolidated Statements of Cash Flows (continued)
(unaudited)
(in thousands)
Nine Months Ended September 30,
20232022
Supplemental disclosures of cash flow information:
Cash paid for operating leases included in cash used in operating activities$1,246 $1,213 
Non-cash investing and financing transactions:
Purchase of property and equipment included in accounts payable and accrued and other current liabilities747 1,718 
Right-of-use operating lease assets obtained in exchange for lease obligations— 4,534 
Right-of-use finance lease assets obtained in exchange for lease obligations— 123 
Common stock warrants issued for the acquisition of intangible assets4,990 — 
Cash and cash equivalents$37,173 $42,896 
Restricted cash, current1,373 1,167 
Restricted cash, non-current945 675 
Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows$39,491 $44,738 


ESS Tech, Inc.
Reconciliation of GAAP to Non-GAAP Operating Expenses
(unaudited)
(in thousands)

Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
Research and development$1,609 $20,127 $38,790 $49,190 
Less: stock-based compensation(278)(767)(2,401)(1,941)
Non-GAAP research and development$1,331 $19,360 $36,389 $47,249 
Sales and marketing$2,056 1,815 $5,648 $5,217 
Less: stock-based compensation(211)(127)(526)(306)
Non-GAAP sales and marketing$1,845 $1,688 $5,122 $4,911 
General and administrative$5,831 $5,981 $16,963 $20,567 
Less: stock-based compensation(1,522)(2,104)(3,868)(6,456)
Non-GAAP general and administrative$4,309 $3,877 $13,095 $14,111 
Total operating expenses$9,496 $27,923 $61,401 $74,974 
Less: stock-based compensation(2,011)(2,998)(6,795)(8,703)
Non-GAAP total operating expenses$7,485 $24,925 $54,606 $66,271 


ESS Tech, Inc.
Reconciliation of GAAP Net Loss to Adjusted EBITDA
(unaudited)
(in thousands)

Three Months Ended September 30, 2023Nine Months Ended September 30, 2023
Net loss$(16,618)$(61,448)
Interest income, net(1,155)(3,737)
Stock-based compensation2,889 7,673 
Depreciation1,082 3,180 
Gain (loss) on revaluation of common stock warrant liabilities(344)(917)
Other income (expense), net(17)(738)
Adjusted EBITDA$(14,163)$(55,987)


v3.23.3
Cover
Nov. 07, 2023
Entity Information [Line Items]  
Document Type 8-K
Document Period End Date Nov. 07, 2023
Entity Registrant Name ESS TECH, INC.
Entity Incorporation, State or Country Code DE
Entity File Number 001-39525
Entity Tax Identification Number 98-1550150
Entity Address, Address Line One 26440 SW Parkway Ave.
Entity Address, Address Line Two Bldg. 83
Entity Address, City or Town Wilsonville
Entity Address, State or Province OR
Entity Address, Postal Zip Code 97070
City Area Code 855
Local Phone Number 423-9920
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company true
Entity Ex Transition Period false
Entity Central Index Key 0001819438
Amendment Flag false
Common Stock 0.0001 Par Value Per Share  
Entity Information [Line Items]  
Title of 12(b) Security Common Stock, $0.0001 par value per share
Trading Symbol GWH
Security Exchange Name NYSE
Warrants Each Whole Warrant Exercisable For One Share Of Common Stock At An Exercise Price Of 11.50  
Entity Information [Line Items]  
Title of 12(b) Security Warrants, each whole warrant exercisable for one share of common stock at an exercise price of $11.50
Trading Symbol GWH.W
Security Exchange Name NYSE
ESS Tech (NYSE:GWH)
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