Bloom Energy Corporation

Good evening, ladies and gentlemen. Thank you for attending Bloom Energy's Q2 2023 Earnings Conference Call. My name is Ana, and I will be your moderator for today's call. All lines will be muted during the presentation portion of the call, with an opportunity for questions and answers at the end. Once you ask the question, please mute your line. If you have a follow-up question, please queue up again. I will now pass the conference over to your host, Ed Vallejo, Vice President of Investor Relations. Please proceed.

Thank you, and good afternoon, everybody. Thank you for joining us for Bloom Energy's second quarter 2023 earnings conference call. To supplement this conference call, we furnished our second quarter 2023 earnings press release with the SEC on Form 8K and have posted it along with supplemental financial information that we will reference throughout this call to our investor relations website. During this conference call, both in our prepared remarks and in answers to your questions, we may make forward-looking statements that represent our expectations regarding future events and our future financial performance. These include statements about the company's business results, products, new markets, strategy, financial position, liquidity, and full-year outlook for 2023. These statements are predictions based upon our expectations, estimates, and assumptions. However, as these statements deal with future events, they are subject to numerous known and unknown risks and uncertainties as discussed in detail in our documents filed with the SEC, including our most recently filed forms 10-K and 10-Q. we assume no obligation to revise any forward-looking statements made on today's call. During this call and in our second quarter 2023 earnings press release, we refer to GAAP and non-GAAP financial measures. The non-GAAP financial measures are not prepared in accordance with U.S. generally accepted accounting principles and are in addition to and not a substitute for or superior to Measures of Financial Performance Prepared in Accordance with GAAP. A reconciliation between the GAAP and non-GAAP financial measures is included in our second quarter 2023 earnings press release available on our investor relations website. Joining me on the call today are K.R. Schroeder, founder, chairman, and chief executive officer, and Greg Kaminer, our president and chief financial officer. K.R. will begin with an overview on our business, Then Greg will review the operating and financial highlights of the quarter, as well as the outlook for the year. And after our prepared remarks, we will have time to take your questions. I will now turn the call over to K.R.

Hello, everyone. It was so great to see so many of you in person at the New York Stock Exchange for our Investor Day. And again, we really appreciate you all joining us today for this call. At Bloom, We are continuing to make great progress. We grew our revenues, reduced our costs, and strengthened our balance sheet in the second quarter. We are dedicated as ever, and we are trying to build a great company that can meet the energy needs not just today, but for the future also. Like me, probably all of you are watching the news and reading the headlines, the messages on energy and climate. are extremely clear. We just exited the month of July, and it was the hottest month on the planet in recorded history. And we are looking at deadly heat waves, electrification of everything, digital transformation, all of them raising the demand for electricity. And the growing demand for power is far outstripping the growth in supply in most places. And what is that doing? It's just creating the power shortages. And for people that want to grow their business, it is creating a time to power issue for them. The electric grid, it is just stretched to the limit and it's being run to fail. And we, believe it or not, in this century are living with the constant threat of power outages. And to add insult to injury, the power prices are rising really steeply. Business leaders really are taking note of all this, and they're becoming anxious. They're becoming anxious about energy security and the spiking energy costs. And in addition to that, they're getting very concerned about their decarbonization goals and how they're going to meet it. So energy strategy now has become a real boardroom issue of great concern for companies. And many CEOs and boardrooms are finally realizing that this is not a short-term crisis they can somehow ignore and expect it to go away very soon. It's here to be with us for a while, and they have to look for alternative solutions. solutions for energy that actually are more predictable and reliable. In other words, they're asking for proven and reliable alternatives to the grid and very simply be able to find that solution that is easy to transact with no hidden costs, hassles, and they don't have to be a rocket scientist to figure out what that alternative is. Listen, our message to the market is very clear. The Bloom Energy servers, you can say two things about them. They're resilience tested and they're market proven. It'll allow you, the businesses, to take control of your power and protect your companies as a viable alternative and a real enhancement to the grid. And this solution we have for you We have scaled it. It is scalable. We have proven that it's affordable. And most importantly, it's available today. It's not some future technology. So not only can you operate these boxes we'll ship now with net zero hydrogen right away if it is available to you, but until it's available to you, you can use natural gas. And when we listen to the customers, you, what we heard is you want an alternative and you want control. You tell us that you're worried about switching to a solution that doesn't have a track record. That's not a problem with Bloom. You say that you do not want to make big capital investments or lock yourselves up in long-term contracts because while you want the reliability, you also want the flexibility. You want the flexibility. Five years from now, if there's a better solution, you want to switch to that. And five years from now, the location where you're operating is not where you want to continue operating. You want to be able to free to move. In other words, you're asking for a proven option that's reliable and flexible. At the same time, it's very simple to transact and it doesn't have hidden costs or hassles. We responded to these customer concerns and needs by launching a brand new offering last week, the Series 10. It's a power buying model that's a first of its kind in the U.S. power industry. What did we try to do with this offering? To make it extremely simple for companies to take control of their power needs if they're a substantial user of electricity, 10 megawatts and higher. Let me just explain how simple this is by addressing six salient points about the Series 10 and how the needs and concerns of the customers are met by the Series 10 offering. Number one, this concern about unpredictable and rising power costs, right? Well, we'll give you a flat power price for five years. Fixed, flat, right? In many places, it can be as low as 9.9 cents a kilowatt hour.