Eco Wave Power Global AB (publ) (WAVE)

Executive Summary / Key Takeaways

• Eco Wave Power is a pioneer in onshore wave energy, developing proprietary technology that offers a stable and dense renewable energy source with a smaller environmental footprint, positioning it for growth in the nascent marine energy sector.
• The company has achieved significant operational milestones, including the successful launch of its first U.S. project in the Port of Los Angeles and the advancement of a megawatt-scale project in Portugal, demonstrating efficient project execution and global expansion.
• Financially, Eco Wave Power is in an investment phase, with increased operating expenses in H1 2025 reflecting strategic R&D and project deployment, while maintaining a solid cash position of $7.94 million to fund future growth.
• A key strategic objective is to achieve profitability through "turnkey" project sales, with management anticipating that securing three to four such deals will establish Eco Wave Power as the first profitable wave energy company globally.
• The long-term outlook is bolstered by technological advancements, emerging applications like powering AI infrastructure, and supportive legislative initiatives such as the U.S. Marine Energy Technologies Acceleration Act.

Unlocking the Ocean's Untapped Potential

Eco Wave Power Global AB (publ) stands at the forefront of a burgeoning renewable energy sector, dedicated to harnessing the immense, consistent power of ocean and sea waves to generate clean electricity. Founded in 2011 and headquartered in Tel Aviv-Yafo, Israel, the company has meticulously developed and refined its proprietary onshore wave energy conversion (WEC) technology. This innovative approach differentiates Eco Wave Power within the broader marine energy landscape, offering a unique value proposition that emphasizes stability, efficiency, and a reduced environmental footprint.

The global energy transition is accelerating, driven by a pressing need for diversified and reliable renewable sources. While solar and wind power have gained significant traction, their intermittency presents challenges for grid stability. Wave energy, with its near-continuous availability, emerges as a compelling complement. This growing demand for stable, dense renewable supply is further amplified by the escalating energy needs of high-demand computing environments, such as AI infrastructure and coastal data centers. Eco Wave Power's technology is strategically positioned to address these evolving market dynamics, offering a versatile solution that can support the next generation of digital innovation while reducing reliance on carbon-intensive sources.

Technological Edge: The Heart of Eco Wave Power

Eco Wave Power's core differentiation lies in its patented onshore WEC technology. Unlike offshore systems that face harsher conditions and higher maintenance costs, Eco Wave Power's solution integrates directly with existing coastal structures like breakwaters and jetties. This design significantly simplifies installation, operation, and maintenance, enhancing overall project viability.

The tangible benefits of this technology are becoming increasingly evident through operational data. The EWP-EDF One project at Jaffa Port in Israel, a key R&D and benchmarking site, has demonstrated that wave energy can generate significantly more power per site footprint than other renewable energy sources. Successful testing with 10 floaters in wave heights of 1.22 meters yielded an average power output of 13 kilowatts, with peak production reaching 40 kilowatts. These results support projections that scaling the system could proportionally increase output to 26% with 20 floaters and 39% with 30 floaters. Furthermore, the Portugal megawatt-scale project is expected to operate with approximately 90% wave availability, validating the technology's potential for almost continuous energy generation.

The company's R&D efforts for 2025 are sharply focused on reducing floater costs and streamlining installations. This strategic initiative aims to lower the levelized cost of energy (LCOE), enabling Eco Wave Power to offer more competitive pricing and accelerate the mainstream adoption of wave energy. The recent launch of the first-ever drone-powered maintenance for onshore wave energy systems, in collaboration with BladeRanger, further underscores the company's commitment to operational efficiency and technological innovation in the long term.

Competitive Dynamics in a Nascent Market

Eco Wave Power operates in the niche, yet strategically important, wave energy segment. While the broader renewable energy market includes established players in solar and wind, direct competition primarily comes from other developers of marine energy technologies. Companies like Ocean Power Technologies (OPTT), Carnegie Clean Energy (CWGYF), and Minesto (MINEST) are notable rivals, each pursuing distinct approaches to harnessing ocean power.

Eco Wave Power distinguishes itself through its onshore focus, which offers advantages in deployment flexibility and maintenance accessibility compared to offshore systems. The company's strategic emphasis on a global pipeline of power purchase and concession agreements also provides a unique pathway to market entry and revenue generation. While direct quantitative comparisons of market share are challenging to ascertain for all niche competitors, Eco Wave Power's robust project pipeline and strategic partnerships suggest a strong competitive stance in emerging markets.

However, Eco Wave Power, as an earlier-stage company, currently lags some competitors in terms of financial performance and operational execution maturity. For instance, its TTM operating profit margin stands at -1533.93% and net profit margin at -1757.74%, reflecting significant investment in development.

More established players in marine energy may exhibit stronger trends in revenue growth and cash flow from operational projects. Despite this, the high barriers to entry in the wave energy industry, including substantial R&D costs and complex regulatory approvals, help protect Eco Wave Power's position by limiting the influx of new entrants.

A History of Strategic Execution and Global Expansion

Eco Wave Power's journey has been marked by a disciplined approach to technology development and strategic market penetration. The EWP-EDF One project at Jaffa Port achieved a significant milestone in June 2024, recording 0% downtime for the first time, and by September 2024, it reached 83% of its energy generation target, surpassing the performance of the company's earlier grid-connected project in Gibraltar. This operational success culminated in an official opening ceremony for Israel's first wave energy power station in December 2024.

The company's global footprint expanded rapidly in 2024 and 2025. In the United States, the Port of Los Angeles project, a co-investment with Shell (SHEL), saw its final license secured in March 2025. Just six months later, the full installation of floaters and the onshore energy conversion unit was completed, leading to its official launch on September 9, 2025. This rapid execution demonstrates Eco Wave Power's ability to deliver projects efficiently while maintaining high technical standards.

Portugal represents another cornerstone of Eco Wave Power's growth strategy. Under a 20-megawatt concession agreement, engineering designs were finalized in March 2025, and the first installment of the grid connection fee was paid by May 2025, keeping the project on track for a 2026 startup. This megawatt-scale project is anticipated to be the first in the world to demonstrate significant energy production from wave power. Further expansion into Asia includes a pivotal turnkey wave energy deal in Taiwan and a Memorandum of Understanding with Bharat Petroleum in India to explore deployment at the Mumbai Oil Terminal. The company also entered the African market with a feasibility study agreement in South Africa in July 2025 and secured a EUR 2.45 million grant for the Atlantic Wave Energy Sustainable Deployment Initiative.

Financial Performance and Liquidity

Eco Wave Power's financial trajectory reflects its growth-oriented investment phase. For the first half of 2025, operating expenses totaled $1.6 million, an increase of $239,000 from H1 2024. This rise was primarily driven by a 25% increase in R&D expenses to $399,000, focused on the Portuguese project and strengthening the engineering department, alongside a 22% increase in general and administrative expenses to $1.1 million due to new U.S. hires and project expansion.

Despite these investments, sales and marketing expenses decreased by $123,000, reflecting more efficient investor communication. Other income nearly doubled to $62,000, primarily from technology demonstration services in Asia. The net loss for H1 2025 was $1.9 million, influenced by growth investments and foreign exchange impacts.

Looking at the first quarter of 2025, the net loss improved slightly to $505,000 compared to $527,000 in Q1 2024, indicating efforts to maintain cost discipline. Operating expenses in Q1 2025 were $765,000, up from $659,000 in Q1 2024, mainly due to engineering and execution work for the Los Angeles and Portugal projects. The company has demonstrated a commitment to cost efficiency, achieving a 10% quarter-over-quarter reduction in overall expenses from Q2 to Q3 2024.

Liquidity remains a key strength, providing a solid foundation for ongoing projects. Eco Wave Power ended the first half of 2025 with $7.94 million in cash and short-term bank deposits. This figure compares to $8.8 million as of March 31, 2025, and $7.04 million as of September 2024. The modest decrease in cash reflects development-stage spending in Los Angeles, Portugal, India, and Taiwan.

The company's current ratio stands at a healthy 3.38, and its debt-to-equity ratio is 0.20, indicating a manageable debt load. Furthermore, shareholders approved the continued authorization for the repurchase of American Depositary Shares (ADSs) at the 2025 Annual General Meeting, a strategic move aimed at enhancing shareholder value and improving the company's capital structure.

Outlook and Risks

Eco Wave Power's outlook is firmly anchored in its multi-layered commercialization strategy. Management anticipates continued progress on its pilot sale agreement in Taiwan and expects advancements on contracts in India. The Portugal megawatt-scale project is on track for a 2026 startup, a critical milestone expected to demonstrate significant energy production. A key quantitative target for management is to secure "three to four similar deals" to the turnkey project in Taiwan, which they believe will position Eco Wave Power as the first profitable wave energy company worldwide. This ambition underscores the company's transition from a pure R&D entity to a commercial enterprise.

The company's strategic expansion of its engineering and U.S.-based sales and business development teams is expected to accelerate project delivery and boost revenues from turnkey projects. The addition of Hilary Ackermann to the Board of Directors in July 2025, with her extensive experience in energy and finance, further strengthens the company's governance and global commercialization strategy.

Despite the promising outlook, investors should consider potential risks. While the company is confident that states like California will lead in clean energy initiatives, uncertainty surrounding federal legislation, such as the Inflation Reduction Act under future administrations, could impact the broader renewable energy landscape. The nascent nature of the wave energy industry also entails inherent technological and regulatory risks, alongside the capital-intensive requirements for scaling projects. However, legislative support, such as the proposed U.S. Marine Energy Technologies Acceleration Act, which seeks to allocate $1 billion for marine energy commercialization, could significantly de-risk future deployments and provide vital funding.

Conclusion

Eco Wave Power is a pioneering force in the emerging wave energy sector, distinguished by its innovative onshore technology and a clear, multi-layered commercialization strategy. The company's recent operational successes in the U.S., Portugal, and Asia, coupled with a disciplined financial approach to growth investments, underscore its potential to transform ocean waves into a reliable and significant source of clean electricity. While currently in an investment phase with negative profitability, the strategic focus on reducing floater costs, streamlining installations, and securing turnkey project deals provides a tangible pathway to profitability.

The long-term investment thesis for Eco Wave Power is compelling, driven by its technological advantages, strategic global expansion, and the increasing demand for stable renewable energy solutions, including those for high-growth sectors like AI infrastructure. As the company continues to execute on its project pipeline and realize its goal of becoming the first profitable wave energy company, its technological leadership and strategic positioning in a rapidly evolving energy landscape make it a noteworthy consideration for discerning investors seeking exposure to the next frontier of renewable power.