Factorial Books First Revenue, Cuts 2026 Cost Outlook
The solid-state battery maker reported about $26.0 thousand of third-quarter revenue and now sees full-year non-GAAP operating expenses of $36 million to $38 million.
Factorial Energy Inc. (FAC), a solid-state battery developer, recorded its first commercial revenue of approximately $26.0 thousand in the third quarter ended September 30, 2026, well ahead of a previously disclosed 2027 objective, after securing a commercial aerospace order in July and beginning deliveries under it.
The company said it took that aerospace program from sampling and validation through system integration to recognized revenue in a few months. Gross loss was $1.8 million, nearly all of it a $1.8 million write-down of inventory built to support near-term demand. Factorial said that at initial production volumes, low fixed-cost absorption and higher material prices put the cost of each cell above its expected selling price, and that it expects unit costs to decline as production scales.
GAAP net income was $8.8 million for the quarter, primarily from a $24.0 million non-cash gain on warrant liabilities, compared with a $34.6 million net loss in the year-ago quarter. Operating expenses were $14.6 million, including a $4.1 million legal judgment. Excluding certain non-cash expenses and that judgment, non-GAAP operating expenses were $9.0 million.
Aerospace program cells achieved the 450 Wh/kg energy-density target the company had set for year end, about 15% higher than the cells that powered a Group I drone world-record flight of more than 8.5 hours in July. Lithium-metal cells had already shown more than 30% longer range at the system level in initial flight versus lithium-ion, the company said. Solstice cells were produced in sizes up to 40 Ah and delivered to partners for development validation.
Industrial partnerships advanced on a capital-light model. In July, SK On signed a memorandum of understanding to jointly evaluate producing Factorial’s technologies across its global manufacturing network, described as the second significant industrialization partner of the year. In September, a joint development agreement with Mitsui Kinzoku added a sulfide solid-electrolyte partner, completing partners for all three key active materials of Solstice alongside POSCO Future M. A FEST line can use up to 80% of the equipment in a conventional lithium-ion line, the company said, and its pilot line has demonstrated yield above 85%.
Cash and cash equivalents were approximately $95.4 million as of September 30, after $2.8 million of third-quarter capital expenditures.
Factorial now expects full-year 2026 non-GAAP operating expenses of $36 million to $38 million, below a prior outlook of approximately $40 million. It said the lower range reflects continued spending discipline and a portion of production costs now recorded in inventory and cost of revenues rather than operating expenses. Full-year capital expenditures are expected at $10 million to $12 million, compared with approximately $13 million previously, reflecting the timing of milestone-based equipment payments, some of which may move into early 2027.
The FEST line expansion is on track for completion by the end of 2027, and the Solstice line expansion by the end of 2028. The company said it expects more meaningful commercial revenue in 2027 as production programs begin, with revenue expected to remain modest and vary from quarter to quarter until those programs ramp. It said its cash position, disciplined operating model, and capital-light approach give it the runway to carry out its current operating plan.
After quarter end, Stellantis unveiled the PEUGEOT RCZ Vision concept car featuring a solid-state battery developed with Factorial, with a 1,000-volt architecture designed to charge from 10% to 80% in 10 minutes. Factorial said its next major automotive goal is a production offtake agreement with a mainstream automaker, building on a supercar order received in January.
Stronger demand supports expansion as pricing diverges
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