Business Overview and History

Energous Corporation (WATT) is a pioneering technology company that has developed a scalable, over-the-air (OTA) wireless power network (WPN) solution. The company's innovative technology integrates advanced semiconductor chipsets, software controls, hardware designs, and antenna systems to enable radio frequency (RF)-based charging for Internet of Things (IoT) devices. Energous' WPN technology provides a comprehensive suite of capabilities designed to power the next generation of wireless energy networks, seamlessly delivering power and data across diverse, battery-free device ecosystems.

Energous was founded in 2012 and is headquartered in San Jose, California. The company's journey began with the vision of revolutionizing the way electronic devices are charged and powered. Over the years, Energous has made significant strides in developing its proprietary wireless power technology, transforming the landscape of IoT device charging and powering.

Since its inception, Energous has focused on developing and commercializing its WPN technology, which enables both near-field and at-a-distance wireless charging. The company's solutions are designed to supply power at multiple levels across varying distances, catering to a wide range of wireless charging applications across diverse device categories.

In 2019, Energous achieved a significant milestone with the introduction of the first WPN-enabled end product featuring its technology. This breakthrough marked the company's entry into the commercial market and laid the foundation for future partnerships and deployments.

Building on this success, Energous continued to innovate and expand its product offerings. In the fourth quarter of 2021, the company reached another crucial milestone by commencing shipments of its first at-a-distance wireless PowerBridge transmitter systems for commercial IoT applications and proof-of-concept deployments.

Throughout its history, Energous has developed and released multiple transmitter and receiver solutions, including prototypes and partner production designs. The company's transmitters vary in form factor, power specifications, and operating frequencies, while the receivers are engineered to support a wide range of wireless charging applications across multiple device categories.

Despite its progress, Energous has faced various challenges in developing and commercializing its technology. The company has incurred operating losses and negative cash flows from operations, necessitating additional financing through securities offerings and short-term loans to fund its research and development efforts and support the transition from the development stage to commercial production.

Navigating the regulatory landscape has also been a key focus for Energous. The company has worked closely with domestic and international agencies to establish processes, standards, and spectrum allocation to ensure devices incorporating its technology can secure the required approvals.

Financial Performance and Ratios

Energous has demonstrated steady growth in its financial performance, despite the challenges posed by the evolving market dynamics and regulatory landscape. In the fiscal year 2024, the company reported total revenue of $768,000, a significant increase from $474,000 in the previous year. This 62% year-over-year growth reflects the company's successful transition from non-recurring engineering services and micro-chip sales to the sale of its PowerBridge transmitter systems.

The company's gross profit for 2024 stood at $12,000, with a gross profit margin of -4.69%. While the gross margin remains negative, Energous has made strides in improving its operational efficiency, as evidenced by the reduction in its operating expenses from $22.29 million in 2023 to $18.42 million in 2024, a 17% decrease.

Energous' net loss for the fiscal year 2024 was $18.40 million, compared to a net loss of $19.37 million in the previous year. The company's cash and cash equivalents as of December 31, 2024, stood at $1.35 million, a decrease from $13.94 million at the end of 2023, reflecting the company's focus on investing in R&D and commercialization efforts.

For the most recent quarter (Q3 2024), Energous reported revenue of $230,000, representing a 36.1% year-over-year increase driven by higher commercial PowerBridge transmitter system shipments. The net loss for the quarter was $3.4 million.

Liquidity

In terms of liquidity, Energous' current ratio stood at 0.60 as of December 31, 2024, indicating a need to address its short-term obligations. The company's quick ratio was 0.50, and its working capital position showed a deficit of $1.96 million, highlighting the importance of securing additional financing to support its growth initiatives.

Energous has been actively exploring various financing options, including at-the-market (ATM) offerings and subordinated loan agreements, to strengthen its financial position and fund its ongoing operations. In the first two months of 2025, the company successfully raised net proceeds of $13.4 million through its ATM program, which has greatly stabilized its financial situation and provided growth capital for the company.

As of December 31, 2024, Energous had a debt-to-equity ratio of -1.38. The company entered into a $997,000 subordinated loan agreement in November 2024, with the ability to receive additional term loans of up to $1.6 million, subject to certain conditions.

Regulatory Approvals and Partnerships

Energous' wireless power technology involves the transmission of power using RF energy, which is subject to regulation by various authorities, including the Federal Communications Commission (FCC) in the United States. The company has made significant strides in securing the necessary regulatory approvals, with its Energous 2W PowerBridge transmitter system receiving full FCC certification in 2024, making it the industry's first certified transmitter available at this power level.

Energous has also been actively forging strategic partnerships to drive the adoption of its technology. In 2024, the company was awarded a scalable, multi-phase contract with a Fortune 10 retailer, which is part of a nationwide infrastructure optimization program to upgrade approximately 4,700 retail locations over the next three to five years. This milestone showcases the growing market demand for Energous' WPN solutions and the company's ability to successfully integrate its technology into large-scale commercial applications.

Furthermore, Energous has been recognized for its innovative contributions to the IoT industry, winning the "IoT Connected Retail Innovation of the Year" award in the 2025 IoT Breakthrough Awards program and the "IoT Innovation of the Year" award in the 2024 Mobile Breakthrough Awards program. These accolades underscore the company's technological advancements and its potential to drive the future of wireless power solutions.

Risks and Challenges

Despite Energous' progress, the company faces several risks and challenges that could impact its future growth and financial performance. The highly competitive nature of the consumer electronics industry, with traditional wall plug-in recharging and directly competing wireless charging technologies, poses a significant challenge for Energous to gain widespread market acceptance for its innovative solutions.

Additionally, the company's reliance on third-party components and suppliers, as well as the potential for supply chain disruptions, could adversely affect its ability to manufacture and deliver its products. Regulatory approval processes and potential changes in government policies and regulations also present ongoing risks for Energous, requiring the company to continuously navigate the evolving landscape.

The company's limited operating history and its transition from a research and development-focused organization to a commercialization-driven entity add further complexity to its business model. Energous must effectively manage this transformation and ensure the successful integration of its technology into the broader IoT ecosystem.

Management Changes

In March 2024, Energous announced that Cesar Johnston was no longer serving as President and Chief Executive Officer. As part of his severance agreement, Mr. Johnston received benefits including 18 months of salary, 100% of his target bonus, and acceleration of 18 months of unvested equity awards. The company recorded $1.2 million in total severance expenses related to Mr. Johnston's departure. This management change represents a significant transition for Energous and may impact the company's strategic direction and execution in the near term.

Industry Trends

The market for wireless power solutions and Internet of Things (IoT) devices is experiencing rapid growth, with a forecasted compound annual growth rate (CAGR) of 25% from 2023 to 2028. This positive trend in the industry aligns well with Energous' focus on developing and commercializing its WPN technology for IoT applications.

Geographic Markets

Currently, Energous is primarily focused on the United States market, where it sells its products and services. As a small-cap company, Energous has yet to expand its operations significantly into international markets. However, the potential for global expansion remains as the company continues to develop its technology and secure necessary regulatory approvals in other regions.

Outlook and Conclusion

Energous' innovative wireless power technology and its growing partnerships with industry leaders position the company for continued growth and expansion. The company's strategic focus on delivering scalable, over-the-air wireless power solutions for IoT devices aligns with the increasing demand for battery-free and seamlessly connected devices across various industries, including retail, logistics, and smart home applications.

As Energous navigates the challenges of a rapidly evolving market, its ability to secure additional regulatory approvals, forge strategic alliances, and efficiently execute its commercialization strategy will be crucial to its long-term success. The company's recent financing activities and the successful deployment of its technology in large-scale commercial projects suggest a positive outlook for Energous' future.

The company's transition from research and development to commercial production is reflected in its financial performance, with increasing revenues and efforts to reduce operating expenses. However, Energous continues to face challenges in achieving profitability and maintaining adequate liquidity, as evidenced by its negative cash flows and reliance on external financing.

Investors should closely monitor Energous' progress in scaling its business, expanding its customer base, and achieving profitability, while also considering the risks and competitive landscape that the company must navigate. The recent management change and ongoing efforts to strengthen its financial position will be critical factors in shaping the company's future trajectory.

With its innovative technology, growing partnerships, and a renewed focus on commercialization, Energous is poised to play a significant role in shaping the future of wireless power solutions for the IoT ecosystem. As the market for wireless power and IoT devices continues to expand rapidly, Energous has the potential to capitalize on this growth and establish itself as a leader in the industry.