Overview

Solidion Technology, Inc. is a Dallas, TX-based advanced battery technology company focused on developing and commercializing battery materials, components, cells, and selected module/pack technologies. The company holds a portfolio of over 550 patents covering innovations such as high-capacity silicon anodes, biomass-based graphite, and advanced lithium-sulfur and lithium-metal technologies.

History

In February 2024, Nubia Brand International Corp. (now Solidion Technology, Inc.) completed a merger with Honeycomb Battery Company (HBC), an Ohio-based battery technology company. Solidion received net proceeds of $17,555 from the merger, which it is using to fund its commercialization and manufacturing scale-up efforts.

Solidion also raised additional capital through two private placements in 2024. In March, the company raised $3.85 million, and in August, it raised $4 million. The proceeds from these financings are being used for working capital and general corporate purposes.

Components of Results of Operations

Revenue: Solidion has generated minimal revenue to date from product samples, as it is still in the process of commercializing its battery technologies. The company does not expect to generate significant revenue until it completes the commercialization process and builds out its manufacturing capacity.

Operating Expenses: Solidion’s operating expenses consist primarily of research and development (R&D) costs, as well as selling, general, and administrative (SG&A) expenses. R&D expenses include personnel, equipment, and materials related to technology development. SG&A expenses include personnel, professional services, and other administrative costs.

Other Income (Loss): This includes changes in the fair value of derivative liabilities related to the company’s financing agreements, as well as interest income and expense.

Results of Operations

In 2024, Solidion reported a net loss of $25.9 million, compared to a net loss of $5.3 million in 2023. The increase in net loss was primarily driven by higher operating expenses, including third-party validation testing, professional fees, and other costs associated with operating as a public company. The company also incurred significant non-cash losses related to its financing activities.

Cash Flows

Solidion used $7.4 million in cash for operating activities in 2024, compared to $4.1 million in 2023. The increase in cash used was due to the higher net loss, partially offset by non-cash adjustments and changes in working capital.

The company used $0.2 million in cash for investing activities in 2024, primarily for capitalized patent costs, compared to $0.4 million in 2023.

Solidion generated $11.0 million in cash from financing activities in 2024, primarily from proceeds of the private placements and warrant exercises, offset by repayments of short-term notes and related party advances. In 2023, the company generated $3.8 million in cash from financing activities, consisting of capital contributions.

Going Concern Considerations, Liquidity and Capital Resources

Solidion has experienced recurring net losses and has generated minimal sales, which raises substantial doubt about the company’s ability to continue as a going concern. The company’s ability to fund its operations and capital expenditures depends on its ability to raise additional external capital, which is subject to various risks and uncertainties.

As of December 31, 2024, Solidion had an accumulated deficit of $115.9 million and expects to continue incurring losses for at least the next 12 months. The company is currently engaged in discussions with various financing counterparties to secure sufficient capital to meet its business needs for the foreseeable future.

Critical Accounting Estimates

Solidion’s critical accounting estimate is related to the accounting for its forward purchase agreement, which is classified as a liability-classified instrument. The fair value of this agreement is determined using a Level 3 valuation, which requires significant estimates and judgments.

Recently Adopted and Issued Accounting Standards

Solidion adopted ASU 2023-07 related to segment reporting disclosures, which did not have a material impact on the company’s financial statements. The company is also evaluating the impact of recently issued accounting standards, including ASU 2023-09 on income tax disclosures and ASU 2024-03 on expense disaggregation disclosures.