Tecogen Inc Reports Q4 2024 Earnings: Revenue at $6.08M, Net Loss of $1.19M

Revenue Growth Amidst Operational Challenges

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Mar 17, 2025
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On March 17, 2025, Tecogen Inc (TGEN, Financial) released its 8-K filing detailing the financial results for the fourth quarter and year-end 2024. Tecogen Inc, a prominent manufacturer of high-efficiency, ultra-clean cogeneration products, operates through three segments: Products, Services, and Energy Production. The company designs, manufactures, markets, and maintains cogeneration systems, providing energy solutions that significantly reduce carbon footprints.

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Financial Performance and Challenges

Tecogen Inc reported a revenue increase to $6.08 million for the quarter ended December 31, 2024, up from $5.90 million in the same period of 2023, marking a 3.0% growth. Despite this revenue growth, the company faced a net loss of $1.19 million, an improvement from the $1.85 million loss in the previous year. The improvement in net loss was attributed to increased gross profit from the Products and Services segments and reduced operating expenses.

For the full year, Tecogen Inc experienced a net loss of $4.76 million, slightly higher than the $4.60 million loss in 2023. This increase was primarily due to decreased revenue and gross profit in the Products segment, impacted by the relocation of manufacturing operations and a $0.22 million goodwill impairment.

Revenue and Segment Analysis

Quarterly revenues were driven by a 13.7% increase in Services revenue, reaching $4.08 million, and a modest 1.6% rise in Energy Production revenue to $550 thousand. However, Products revenue declined by 18.3% to $1.44 million, reflecting reduced cogeneration and engineered accessory sales.

Annually, total revenues decreased by 10.0% to $22.62 million, with Products revenue dropping by 49.8% due to the temporary halt in manufacturing operations. Conversely, Services revenue grew by 10.7% to $16.07 million, bolstered by new and existing contracts, while Energy Production revenue increased by 19.6% to $2.10 million.

Gross Profit and Operating Expenses

Gross profit for the quarter improved to $2.73 million from $2.35 million in the previous year, with the gross margin expanding to 45.0% from 39.8%. This was driven by lower provisions for obsolete inventory and improved Energy Production margins. For the year, gross profit slightly declined to $9.87 million, but the gross margin increased to 43.6% from 40.6%.

Operating expenses for the quarter decreased by 7.0% to $3.87 million, primarily due to reduced credit loss expenses, partially offset by a goodwill impairment. For the year, operating expenses slightly decreased to $14.40 million.

Cash Flow and Financial Position

Tecogen Inc generated $4.06 million in cash from operations during 2024, with a cash balance of $5.41 million at year-end. The company invested $0.97 million in property, plant, and equipment, mainly for improvements at the North Billerica facility. Additional funding of $1.0 million from related parties and increased customer deposits contributed to the cash position.

CEO Commentary and Strategic Developments

Abinand Rangesh, CEO of Tecogen, stated, "There have been multiple exciting developments at Tecogen. We recently signed a global partnership with Vertiv, we closed an InVerde project with a small data center in CT, and our backlog is strong. We were also successful in collecting substantial customer deposits, so we finished the year with >$5m in cash, placing us in a favorable position to grow."

Conclusion and Outlook

Tecogen Inc's financial results reflect a challenging year with operational disruptions impacting the Products segment. However, the company demonstrated resilience through revenue growth in Services and Energy Production, alongside strategic partnerships and project wins. The improved cash position and gross margins provide a foundation for future growth, as Tecogen continues to navigate industry challenges and capitalize on new opportunities.

Explore the complete 8-K earnings release (here) from Tecogen Inc for further details.