Smart energy storage company Stem‘s revenue in the third quarter (Q3) of 2024 dropped 78% to $29.3 from $133.7 million in Q3 2023 due to lower battery hardware sales. This decrease includes reductions of $5.6 million and $37.4 million, attributed to adjusted valuations of assets under specific hardware price guarantees established in 2022 and 2023.

Stem’s net loss rose 92.3% year-over-year (YoY) to $148.3 million from a $77.1 million net loss, primarily due to a $104.1 million bad debt expense related to impairments on accounts receivable for customer contracts with a parent company guarantee.

The company’s earnings per share (EPS) of -$0.18 for Q3 exceeded analyst expectations by $0.021. The company concluded Q3 2024 with $75.4 million in cash and cash equivalents, compared to $89.6 million at the end of Q2 2024. David Buzby, Stem’s Interim Chief Executive Officer, acknowledged the significant revenue drop due to lower hardware revenue during the quarter.

The company recorded bookings of $29.1 million, a decline from $676.4 million in Q3 2023, mainly due to reduced bookings for battery hardware resales.

The contracted backlog stood at $1.5 billion, reflecting a 17% decrease from the end of Q3 2023 and a 2% decline from the end of Q2 2024. Contracted storage assets under management (AUM) totaled 6 GWh, up 20% YoY. Solar monitoring AUM reached 28.5 GW, up 8% from Q3 2023. Stem stated that it is implementing cost-cutting measures to optimize business operations in accordance with a revised strategic approach.