Bloom Energy Corporation

Thank you for standing by. My name is Mandeep, and I'll be your operator today. At this time, I'd like to welcome everyone to the Bloom Energy Q2 2024 Earnings Conference call. All lines will be placed on mute to prevent any background noise. After the speaker's remarks, there'll be a question and answer session. If you'd like to ask a question during this time, simply press star, followed by the number one on your telephone keypad. If you'd like to withdraw your question, press star one again. Thank you. I would now like to turn the call over to Ed Vallejo, Vice President, Investor Relations. You may begin.

Thank you, and good afternoon, everybody. Thank you for joining us for Bloom Energy's second quarter 2024 earnings call. To supplement this conference call, we furnished our second quarter 2024 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 2024. 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 2024 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 preferred in accordance with GAAP. A reconciliation between the GAAP and non-GAAP financial measures is included in our second quarter 2024 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 Dan Berenbaum, our CFO. K.R. will begin with an overview of our process and then Dan will review financial highlights for the quarter. And after our prepared remarks, we will have time to take your questions. I will now turn the call over to K.I.

Hello, everyone, and thanks for joining us today. We executed the first half of 2024 to plan with strong financial discipline. We are on track to meet our yearly guidance. We expect to end the year in a strong financial position and continue to advance our technology, operations, and team for robust future growth. It is now widely understood that demand for electricity is expected to far exceed available supply through the grid. It is presenting Bloom with a huge opportunity. We are seeing high levels of commercial interest in our products and solutions. We have not experienced anything like this in the past two decades. As I see it, this trend is here to stay for at least another decade, and if anything, will gain further momentum in the coming months and years. While there is concern about the ability to meet growing power needs, I believe it's possible to close the gap in power production in 5 to 10 years by adding a combination of utility-scale renewable and gas-based generation. it will not solve the time to power issues for an end customer who requires electricity to be delivered reliably at their specific location of use. As I see it, even assuming massive coordinated investments and clearing of all regulatory and permitting hurdles, it would take well over a decade to make the necessary transmission and distribution upgrades that bring power from generation sites to the customer location. Most of the demand for power growth will come from data centers and vehicle and building electrification. In my view, most of this load growth will be location specific. Let me highlight a few. To minimize latency, AI and other data centers need to be close to the customer. Edge data centers will be the dominant users of power. They will be in economic nerve centers that are already power constrained. Dense and power scarce population centers will have the greatest need for power to charge their mass transit EV systems and delivery fleets. Populous cities with distribution constraints will need the most traditional power to electrify residences and commercial buildings. As you can see from these three examples, the markets where the grid is already constrained is also where future stress from increased demand is going to come. The grid's ability to supply more power for timely business growth is going to be severely challenged. Delays will ensue. In a competitive business environment, every delay means lost revenue and opportunity. So, what do you do if you're a data center, a manufacturer, a fulfillment center, a mission-critical hospital, or a retail chain that needs power now? Rather than wait for the grid and forego revenue growth, it will be important for companies to take control of their own destiny by procuring distributed power generation at the point of use that is dedicated for them. If you want to generate 24-7 power reliably at the point of use without air pollution and no noise and you need it now, there is no better solution in the market than the Bloom Energy Servers. Our energy servers can be grid-tied or completely islanded. No grid interconnection needed. Last year, our average fleet availability at over our 850 installation sites was 99.995%. Let me repeat. Our annual availability of all our energy servers at all our sites, that is over 850 sites, was 99.995%. 0.995%, a metric that cannot be matched by any other commercial solution in the market today. The Bloom Energy solution, which is zero emissions when operated with net zero fuels, also offers the lowest carbon footprint on-site power when operated with natural gas. Today, even the utilities themselves are aware that they need help and Bloom is an excellent alternative and supplement. They have a choice. Either force developers to wait five plus years for power or embrace Bloom's technology and help their customer and communities grow. We see two paths to serving an end user. First, we can work with the end customer directly as you have seen with our existing behind-the-meter solutions. We continue to see a strong pipeline and large project sizes, both in the US and internationally. CoreWeave, a leader in AI, recently purchased Bloom's servers. This is further validation of our technology's importance to artificial intelligence. Second, we can serve the end customer with front-of-the-meter solutions. Silicon Valley Power just received City Council approval for up to 100 megawatts of new generation to be served with front of the meter generation that will be sleeved to specific customers in dedicated megawatt increments. As part of the 100 megawatts, 20 megawatts was approved using Bloom Energy servers for AWS. Bloom is working with SVP to support the needs of its customers like AWS. Bloom is excited to support SVP's fuel cell development once it finalizes terms with AWS. Under the planned structure, SVP will resell the power generated by Bloom's energy server directly to customers under a dedicated rate structure or tariff. This fulfills SVP's growth needs without impacting other SVP ratepayers. SVP is currently working on procuring the additional 80 megawatts to serve its customers, mainly data centers, using the same model. We applaud Silicon Valley Power for being a leader in providing power choice to its customers. We thank them for embracing Bloom's solution. I believe that other utilities should and will follow suit. It is obvious that rather than losing local jobs and tax dollars, such a solution is a win for the local economy, the rate payers, the customer, the utility, and Bloom. Now switching to technology development, we continue to innovate and further strengthen our leadership position. Earlier this week, we announced that we have achieved 60% electrical efficiency and 90% high temperature combined heat and power efficiency, while using 100% hydrogen in our fuel cells. These are record efficiencies using hydrogen as a fuel in our energy servers. Also, I see our CHP offering as a key benefit to customers for heating and cooling. we can achieve 90% fuel efficiency with this option. The first US installation of our CHP solution is at the Energy and Innovation Center in New Britain Park, Connecticut for 20 megawatts and is ready for commissioning. In this case, the bloom solution will be leveraged for the parks development of a high performance computing and data center corridor. These examples. speak to the capability and speed with which our team executes on innovating and implementing new technology, as well as the versatility of our solid oxide platform. I'll be back to take your questions shortly, but for now, I'll turn it over to Dan.