T1 Energy (TE) Q3 2026 Earnings Call Transcript

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DATE

Thu, Nov. 12, 2026

CALL PARTICIPANTS

• Chairman and Chief Executive Officer - Daniel Barcelo
• Chief Financial Officer - Evan Calio
• SVP, Special Projects and Operations - David Ziegler
• Chief Legal and Policy Officer - Andy Munro
• SVP, Strategic Engineering and Advanced Manufacturing - Ryan Considine

TAKEAWAYS

• Net Loss from Continuing Operations -- $34.7 million, or $0.12 per share, for the third quarter of 2026.
• Adjusted EBITDA -- ($16.4) million for the third quarter, compared to ($12.2) million for the third quarter of 2025.
• Total Net Sales -- $196.6 million for the third quarter, representing a decrease from $210.5 million for the same period last year.
• Gross Margin -- 8.5% for the third quarter of 2026, reflecting higher facilities-related costs driven by increased inventory production.
• G1_Dallas Module Production -- 1,056 megawatts in the third quarter of 2026, the second highest quarterly run rate in the company's history.
• Module Inventory Build -- 326 megawatts during the third quarter, a strategic decision to prepare for 2027 contract deliveries.
• Fiscal Year 2026 Production Guidance -- 4.0 gigawatts to 4.2 gigawatts for G1_Dallas, tightened from the previous range of 3.1 gigawatts to 4.2 gigawatts.
• Initial 2027 Production Plan -- 5.3 gigawatts, based on the expectation that G1_Dallas capacity will be sold out for the full year.
• Offtake Contract Backlog and Pipeline -- 22.8 gigawatts for the 2027 to 2029 period, more than fourfold the annual production capacity of G1_Dallas.
• New Offtake Contracts -- Nearly 1.6 gigawatts signed in October, bringing total contracted 2027 capacity to more than 3.5 gigawatts.
• G2_Austin Investment -- Approximately $250 million invested to date, with the external steel structure now complete.
• Section 45X Tax Credits -- $155.3 million generated through the third quarter of 2026, which the company is working to monetize.
• Unrestricted Cash -- $59.5 million as of Sept. 30, 2026, out of a total cash, cash equivalents, and restricted cash balance of $137 million.
• Convertible Senior Notes -- $50.4 million in gross proceeds from a private placement completed on Sept. 30, 2026, intended as a bridge to a comprehensive financing solution.
• Section 232 Import Waiver -- 1.725 gigawatts of solar cell imports approved by the Commerce Department to support uninterrupted manufacturing at G1_Dallas.
• Solar Module Pricing Quotes -- Mid-$0.30 per watt range for modules with imported cells and mid-$0.40 per watt range for modules with domestic cells.
• Annualized Adjusted EBITDA Target -- $375 million to $450 million projected upon completion of G2_Austin Phase 1 and integration with G1_Dallas.
• Integrated Production Target -- $650 million to $750 million in annualized Adjusted EBITDA at the full 5 gigawatts G1 and 5 gigawatts G2 scale.
• SG&A Expense -- $71.2 million for the third quarter, driven by increased headcount and fees related to financing and legal transactions.
• G2_Austin Phase 1 Capacity -- 2.1 gigawatts, currently under construction with all production line equipment already at U.S. ports.
• Nordic Asset LOI -- Nonbinding agreement to redevelop the Nordic Giga Arctic asset as a data center, with no company equity contribution required.

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RISKS

• Barcelo stated, "Our stock has faced meaningful pressure in recent months, and we recognize and share in our investors' frustrations," regarding current market sentiment.
• Barcelo stated, "We had every intention and mobilized resources at our disposal to announce a comprehensive debt-based funding solution for G2 months ago. That didn't happen," regarding financing delays for the Austin facility.
• Calio warned that the market for monetizing Section 45X tax credits has developed slowly, particularly for noninvestment grade companies, leading to a timing mismatch between tax credit accruals and cash flow realization.

SUMMARY

T1 Energy Inc. (NYSE:TE) reported it is currently in negotiations with certain institutional investors under exclusivity to secure a comprehensive debt-based financing solution for the first phase of its G2_Austin facility. Management stated that closing this financing remains the company's highest priority to support the construction of its domestic solar cell manufacturing capacity. The company reported increased module pricing and demand following the Section 232 proclamation, which contributed to new offtake contracts signed with several utility scale customers in October. To meet expected 2027 delivery requirements, the company elected to build module inventory in the third quarter, which impacted near-term Adjusted EBITDA.

• CEO Barcelo stated, "Pricing for solar modules has moved materially higher with leading-edge quotes well above what we've seen since we acquired the business."
• The company intends to be the first American solar manufacturer to offer an integrated domestic polysilicon stack using U.S. polysilicon from Hemlock and wafers from Corning.
• Management indicated that G1_Dallas module production for 2027 is expected to be sold out based on current contract coverage and the existing pipeline.
• SVP Ziegler noted that the G2_Austin project has completed its steel structure and begun mechanical, electrical, and plumbing installation.
• The company is engaging with the Commerce Department to access the 232 onshoring relief program based on its capital investment at G2_Austin.
• T1 Energy entered a nonbinding letter of intent to repurpose its Nordic Giga Arctic asset as a data center, which would involve a partner financing all capital expenditures.

INDUSTRY GLOSSARY

• TOPCon: Tunnel Oxide Passivated Contact, a high-efficiency silicon solar cell technology.
• Section 45X: A production tax credit under the Inflation Reduction Act for domestic manufacturing of clean energy components.
• Section 232: A provision of the Trade Expansion Act of 1962 that allows the U.S. to impose tariffs on imports that threaten national security.
• FEOC: Foreign Entity of Concern, a designation used to restrict certain entities from participating in U.S. clean energy tax credit programs.
• MACR: Material Assistance Cost Ratio, a test used to determine the proportion of materials sourced from qualified suppliers for tax credit eligibility.
• OBBBA: One Big Beautiful Bill Act, the legislation containing tax incentives and domestic content requirements for the solar industry.
• G1_Dallas: The company's solar module manufacturing facility located in Dallas, Texas.
• G2_Austin: The company's solar cell manufacturing facility currently under construction in Rockdale, Texas.

Full Conference Call Transcript

Operator: Good day, and thank you for standing by. Welcome to T1 Energy Third Quarter 2026 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Jeff Spittel. Please go ahead.

Jeffrey Spittel: Good morning, and welcome to T1 Energy's Third Quarter 2026 Earnings Conference Call. Before we get started, please turn to Slide 2 for our forward-looking statements disclaimer. During today's call, management may make forward-looking statements about our business. These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expectations. Most of these factors are outside T1's control and are difficult to predict. Additional information about risk factors that could materially affect our business is available in our annual report on Form 10-K filed with the Securities and Exchange Commission and our other filings made with the SEC, all of which are available on the Investor Relations section of our website.

Turning to Slide 3. With me today on the call are Dan Barcelo, our Chairman and Chief Executive Officer; Evan Calio, our Chief Financial Officer; David Ziegler, our SVP, Special Projects and Operations; and joining us for Q&A are Andy Munro, Chief Legal and Policy Officer; and Ryan Considine, SVP, Strategic Engineering and Advanced Manufacturing. I'll now turn the call over to Dan to get us started.

Daniel Barcelo: Thanks, Jeff, and welcome, everyone, to our third quarter 2026 earnings call. Our theme for today's call is "Actions Speak the Loudest." I want to begin by addressing something directly. Our stock has faced meaningful pressure in recent months, and we recognize and share in our investors' frustrations. We had every intention and mobilized resources at our disposal to announce a comprehensive debt-based funding solution for G2 months ago. That didn't happen, and our current stock price in part reflects that disappointment.

Our focus is on what we can control, which is T1's path forward, and we are resolute in our belief that the fundamentals of the U.S. solar industry and T1's unique competitive position are superior today than at any time since we've owned the business. The discussions we have as a management team and Board with potential investors, offtake customers and strategic partners continue to provide a clear signal about our path forward. Keep building while we weather the storm in the capital markets. On financing, which I know is top of mind, we are in negotiations with certain institutional investors under exclusivity with certain exceptions to pursue a comprehensive primarily debt-based financing solution for G2_Austin Phase 1.

We are not going to get ahead of a process that is active, but I want to be clear, closing this financing is T1's #1 priority, and we believe the combination of our organizational progress, the substantial equity we have invested in G2_Austin Phase 1, our commercial momentum and the tailwinds from Section 232 have materially improved the attractiveness of T1 as a financing counterparty. So we are mindful of the stock price, and we will manage our growth and capital prudently while we continue to build commercial momentum in our domestic PV supply chain. But we haven't lost sight of how important it is to invest in T1's future.

In the third quarter, we made the decision to build module inventory at G1 to accommodate newly signed contracts in 2027 with superior economics from what we've previously booked, and we are investing in our people. Our third quarter SG&A run rate is a function of attracting and hiring the best technical and operational personnel from the growing Austin energy and technology ecosystem. These investments dampen near-term financial performance, but we believe they are critical to realizing the full earnings power of the business in its future state with G1 and G2 Phase 1 up and running. What I want to do today is walk you through what is happening at T1. This isn't an external narrative.

I want to discuss specific actions because the third quarter of 2026 and the weeks following have generated a series of concrete verifiable milestones that demonstrate this company is executing its strategy. We are making tangible strides to strengthen T1 over the long term by investing in G2 and our people and the fundamentals of the U.S. utility-scale solar market are improving despite the malaise in the capital markets. Let me start with the intersection of public policy and the polysilicon sector. In October, we received a 232 waiver from the Commerce Department for up to 1.725 gigawatts of solar cell imports to support uninterrupted manufacturing at G1_Dallas.

This is an important near-term bridge that protects our ability to deliver against our customer contracts while G2_Austin continues toward first cell production. The Commerce Department's Section 232 proclamation in support of the domestic polysilicon industry has fundamentally changed the dynamics of the U.S. solar market. Pricing for solar modules has moved materially higher with leading-edge quotes well above what we've seen since we acquired the business. T1's value proposition, American-made, high-efficiency TOPCon modules from G1_Dallas with a clear path to domestic cell production from G2_Austin has never been more differentiated or more in demand. We proved that this quarter with actions, not words.

We announced nearly 1.6 gigawatts of new offtake contracts in October, bringing our total contracted 2027 capacity to more than 3.5 gigawatts. Since this time last year, we have directly negotiated and signed several established U.S. customers to new deals, Avantus, Clearway, Treaty Oak in addition to new merchant customers. These offtake contracts are meaningful commitments that are signed after our customers conduct months of rigorous diligence across T1's strategy, operations, policy roadmap, financial condition, products and people. These contracts are a testament to the fact that T1 is building a roster of respected American utility scale customers for solar modules using high-efficiency polysilicon-based technology. At G2_Austin, construction is progressing as we fund our growth in real time.

The G2 external steel structure is complete. All Phase 1 equipment has arrived at U.S. ports. Mechanical, electrical and plumbing installation has begun. This morning, we'll be introducing you to David Ziegler, our SVP, Special Projects and Operations for more detail. David leads a world-class team of T1 employees, vendors and contractors to execute the construction of this landmark U.S. solar cell fab, which we believe will be T1's cash flow and profit engine. David's credentials include building gigafactories, semiconductor fabs, data centers and dozens of other complex projects. He is one of the many exceptional people who have joined T1 this year, and we're excited for you to hear from him.

I am confident in what we are building in the team that is building it and the demand for what T1 will produce. Let's now go through the details. Please turn to Slide 5. I want to take a moment to explain why we believe T1 is so well positioned in the post Section 232 landscape. T1 intends to be the first American solar company to offer customers an integrated domestic polysilicon stack. Modules that can be made with U.S. polysilicon from Hemlock and wafers from Corning, all assembled at our world-class 5-gigawatt G1_Dallas facility. G2_Austin is the final major piece in that equation.

With Phase 1 online, we expect to manufacture domestic TOPCon solar cells using technology and IP that we now own outright. We believe that our strong competitive position and plan will matter enormously in this new public policy environment. The 232 proclamation has introduced minimum import prices, additional tariffs and potential relief programs that are designed to reward companies like T1 and our partners for investing in the upstream domestic polysilicon supply chain. T1's domestic supply chain commitments through our partnerships with Hemlock and Corning and approximately $250 million already invested in G2_Austin position us on the right side of that equation.

Beyond the supply chain, our ownership of TOPCon intellectual property is a unique asset that we believe no other American silicon-based solar manufacturer holds. T1 now owns what we believe is one of the world's leading commercially validated solar cell technologies. This is about offering customers high efficiency, high domestic content modules that meet the increasingly demanded standards for Section 48E Investment Tax Credit Bonuses. Over a longer-term horizon, owning the IP also presents us with potential avenues to advance TOPCon through R&D channels and licensing opportunities. We are grateful to receive the Commerce Department's support with our recent waiver.

And importantly, we're engaging with Commerce to access the 232 onshoring relief program, which is designed to support companies that are investing in domestic manufacturing capacity using American polysilicon. We believe that T1's current and planned capital investment at G2_Austin makes us one of the compelling candidates for that program. Please turn to Slide 6. The U.S. solar market has changed significantly since the beginning of this year. I want to give you a clear picture of where module pricing is today and what it means for T1. The Section 232 proclamation has precipitated a meaningful increase in inbound customer demand and module pricing.

Other factors are already contributing to robust pricing for polysilicon modules with domestic cells, which scarcely exist today. We are seeing leading-edge pricing quotes for modules with imported cells in the mid-$0.30 per watt range, well above where merchant pricing was in 2025. And for modules with domestically produced cells, the mid-40s. That spread reflects the premium the market is placing on domestic content and T1 is advancing its strategy to serve both markets. The customer response to our 232 waiver has been very positive.

We believe that a growing universe of customers see T1 as a credible, reliable supplier that is investing in America's solar supply chain and they want to lock in access to our capacity, particularly for our 2027 and 2028 volumes at G1_Dallas. Based on the ongoing conversations we are having with Tier 1 customers and the contracts we have already signed, we believe T1 may sell out its 5-gigawatt G1_Dallas capacity for 2027. That would represent a step change in T1's revenue and earnings trajectory, and we are working hard to convert the pipeline of discussions into executed contracts. Please turn to Slide 7.

I want to provide some additional context to our commercial progress because I think it reflects something important about how T1 is being perceived in the U.S. utility scale market. When we started this journey as a U.S. module manufacturer, we acquired existing customer contracts that were executed by Trina Solar's established U.S. distribution network prior to T1's involvement. Today, we have a direct sales organization that is executing its own contracts with some of the largest utilities, IPPs, developers in the United States, including companies like Avantus, Clearway, and Treaty Oak. These are marquee counterparties, and they are choosing T1. Our 2027 to 2029 contract backlog and pipeline now exceeds 22.8 gigawatts, more than 4x G1_Dallas' annual production capacity.

The funnel reflects not just interest but signed contracts and advanced negotiations at pricing levels that reflect the new post-232 world. And the feedback we are hearing consistently is that customers value T1's domestic content story, our TOPCon technology, our product quality and our commitment to customer service. We are also making real progress in bankability, establishing a T1 branded warranty and advancing the rating processes that give project finance lenders confidence in our modules. This is a critical infrastructure for long-term commercial success, and we are investing in it. While we move to Slide 8, I'd like to introduce David Ziegler, SVP, Special Projects and Operations.

David joined T1 this year to lead the construction and delivery of G2_Austin, and he brings extraordinary experience building large-scale complex industrial facilities. David?

Unknown Executive: Thanks, Dan. I'll start briefly with my personal background. Over the last 30 years, I've executed dozens of major construction projects, many of which were far more complex than what we're building in Rockdale. I want to leave you today with one clear takeaway from my remarks. This isn't a hobby, not for me, not for my team and not for our contractors and subcontractors, many of whom I've had the honor of working with for years. We know how to execute this project. We've already identified ways we can enhance design, performance and efficiency when we have the opportunity to build G2 Phase 2.

I have spent most of my career building cool things with smart, ambitious people who think unconventionally. After spending time with Dan, I knew he was one of those people. His vision for T1 is inspiring, and I knew I wanted to be part of that team that he's building. My initial task at T1 is to build Phase 1 of G2_Austin. This project in Rockdale, Texas, is right down the road from a project that me and a lot of my team members have recently worked on. That's the Samsung semiconductor fab. So we're working in a familiar setting with many of the same contractors we've had on that project and many others over the years.

Here's where we stand today. We've completed the steel structure of the building. All the essential production line equipment for Phase 1 is already in the U.S. We're installing the mechanical, electrical and plumbing equipment. Earlier last week, we began to close a portion of the structure ahead of plan came in preparations. As Dan mentioned, he and Evan have been managing our capital spending prudently at G2 with Bridge Capital as they work on the comprehensive financing package. This isn't the first time I've been tasked with advancing a construction project with incremental funding.

We have tools at our disposal in terms of sequencing and execution to make progress while the team sources additional capital, and we continue to employ them at G2 to match the expected time line of the larger financing. In the interim, please rest assured that my team and I are dedicated, experienced and excited to deliver a world-class solar cell fab at G2. And now, Dan, I'll hand the call back to you.

Daniel Barcelo: Thanks, David. Now please turn to Slide 9. At G1_Dallas, the team delivered another strong quarter of production. We produced 1,056 megawatts of solar modules in Q3 2026. And importantly, we made a decision to build 326 megawatts of module inventory during the quarter. This was a deliberate choice to position T1 to begin deliveries against our new offtake contracts as they come online in 2027. We want to be direct about what this means for Q3 numbers. Building inventory has the effect of incurring cost of production ahead of revenue recognition. It is not a reflection of demand, quite the opposite.

We are building inventory because we have contracts to fulfill and we want to be ready to serve our customers. And those deliveries begin in Q4 and ramp through 2027. We expect that inventory build will convert to revenue and EBITDA. On the commercial side, our Q3 net sales were $197 million. And as I mentioned earlier, the new contracts we signed in October for 1.6 gigawatts of 2027 to 2028 deliveries bring our total contracted 2027 capacity to more than 3.5 gigawatts. The commercial machine at G1 is operating well, and we are excited about what Q4 and 2027 will look like as the new contract delivery schedules kick in. For full year 2026, we are narrowing our guidance.

G1 expects full year G1_Dallas module production of 4 gigawatts to 4.2 gigawatts, near the high end of our prior guidance range of 3.1 gigawatts to 4.2 gigawatts. Looking ahead to 2027, with more than 3.5 gigawatts of G1_Dallas capacity already contracted and a customer offtake pipeline well in excess of what we have available, our initial plan is to produce 5.3 gigawatts, which will be consistent with the sold-out status for G1 for the full year. We are looking forward to the financial performance that we believe G1 can generate with higher average pricing and superior contract coverage relative to '25 and '26.

And with that, I'll turn the call over to Evan for a review of our financials and capital formation update.

Evan Calio: Thanks, Dan. Please turn to Slide 10. Let me walk through the third quarter results and then spend some time on our capital formation progress, which I know is a topic of investor interest. On production, as Dan noted, we produced 1,056 megawatts of solar modules in Q3, a strong quarter for manufacturing output. The decision to build 326 megawatts of module inventory in advance of new contract deliveries means that our Q3 outbound volumes and revenues were lower than production, which impacted our Q3 adjusted EBITDA.

We also had higher SG&A expense in the quarter, primarily related to external legal transaction fees associated with our financing, commercial negotiations and growth in T1's organization as we execute construction of and preparation to operate T2. I want to be transparent about the factors that have been weighing against T1's near-term profitability and liquidity as we approach 2027, which has the potential to be a much stronger year based on higher pricing environment and offtake contract mix. First, we monetize our 45X tax credits through sales to third parties in the tax equity markets. That market has been slow to develop this year, particularly for non-investment-grade companies.

As we noted in this morning's press release, we are in discussions with multiple parties to execute potential sales. But until we do, there is a timing mismatch between tax credit accruals and cash flow realization. Second, our SG&A reflects the cost of building a company, not just running one. We have big ambitions for T1 and two years into our corporate rebirth, we're making investments that are intended to benefit our shareholders, customers and partners over the long term. The legal, advisory, organizational and capital investments we are making today are required to finance, construct, operate G2, sign offtake contracts, deepen our talent pool, navigate policy dynamics and manage commercial operations that are rapidly growing.

We have grown into a cost base for a larger multi-asset company that we do not intend to scale linearly with revenue. Essentially, we have prebaked operating leverage into the business while we're building G2, which we expect to catalyze a step change in T1's profitability. Third, G1_Dallas is not yet generating the margins that we believe are achievable with improved module pricing and contract visibility. With the uplift in pricing for G1 modules produced with imported cells, our newest contracts should enable us to generate higher positive margins prior to accounting for 45X realizations.

As Dan mentioned earlier, we are planning for G1 to be sold out for the full year 2027, which should drive much better cost absorption at the asset level. In our view, none of these factors are permanent. They are characteristics of a rapidly growing public company that is investing to deliver a step change in earnings power. On the balance sheet, as of September 30, we had total cash, cash equivalents and restricted cash of $137 million, of which $59.5 million was unrestricted. This reflects ongoing capital development into G2_Austin construction as well as inventory build at G1.

On production guidance, we are tightening the full year 2026 range to 4.0 to 4.2 gigawatts, which is the high end of our previous 3.0 to 4.2 gigawatts. We expect to build some inventory again in the fourth quarter to accommodate recently signed 2027 contracts, but we also believe G1 should be positioned to potentially generate the best overall financial performance of the year in 4Q. Looking ahead to 2027, our initial plan is to produce 5.3 gigawatts given our improved contract visibility, inbound customer demand in excess of our available capacity and an opportunity to capture higher U.S. module pricing.

When we have a more precise forecast of the G2 ramp-up, we intend to refine our mix of G1 module production between imported and domestic cells. Section 232 Onshoring Plan Clarity will complete the picture and allow us to contract the balance of available capacity in 2027 at attractive pricing. Turning to capital formation, which is our top priority. In September, we executed a $50 million private placement of convertible notes due 2031 with an existing qualified institutional investor. This transaction served as a bridge to our targeted comprehensive financing solution.

As has been the case since G2 construction began, the equity and convertible debt markets have underwritten the initial stages of the project while we pursued multiple potential debt-based financing paths. I'm pleased to report that we're now in negotiations with certain institutional investors under exclusivity with certain exceptions to pursue a comprehensive debt financing solution. We are not in a position to disclose the counterparty or the specific terms while negotiations are ongoing, but I want to emphasize that this is an active process and closing it remains our singular focus. We believe that T1 brings several attractive attributes as a potential financing counterparty. This financing is intended to complete the first integrated American polysilicon solar supply chain.

The economics for G1 and G2 are improving with module pricing. T1 is well positioned for a post-232 environment. We have significant collateral at G1 and G2, and we have invested significant equity into our business. We will update investors as this process advances and look forward to being able to share the outcome. In parallel, we're advancing other initiatives to generate value and harvest additional liquidity. I've already referenced our ongoing discussions to monetize 45X credits, which is a key priority. In addition, this morning, we announced that T1 has entered into a nonbinding LOI to redevelop our Nordic Giga Arctic asset as a data center.

Under the terms of the LOI, T1 would contribute the assets, power allowance and queue position for additional power, while the partner would be responsible for the financing capital expenditures in addition to identifying and securing tenant and/or compute offtaker. No T1 equity contribution is a key element of the structure. Although this is an initial tangible step to form a potential joint venture, we are excited about the progress we're making in Norway to harvest value, and we'll keep the market informed as things develop. I'll close with the reiteration of our integrated production guidance targets, which remain our strategic focus. There are no changes to our run rate integrated production adjusted EBITDA targets.

We continue to project $375 million to $450 million in annualized adjusted EBITDA run rate post completion of Phase 1, G2_Austin and integration with G1_Dallas and $650 million to $750 million full 5-gigawatt G1, 5 gigawatt G2 integrated production. These numbers are underpinned by customer contracts and pricing environment we are seeing in the market today, which has only strengthened since 232. And now I'll turn the call back to Dan for closing remarks.

Daniel Barcelo: Thanks, Evan. Please turn to Slide 11. I want to close today by putting the T1 story in a year-over-year context because I think it illustrates just how much this company has accomplished in a very short period of time and why I remain deeply convinced in our investment thesis. A year ago, in November 2025, we were on the cusp of starting construction at G2_Austin with almost no financing in place. We had initial conversations underway for a G2 cell offtake agreement, but nothing signed. Section 232 was just an open investigation with an uncertain outcome.

The OBBBA required that we accelerate planned adjustments to important elements of our business, and we have just raised our first tranche of equity to begin G2 construction. Today, the picture is fundamentally different. We have signed more than 3 gigawatts of directly negotiated offtake contracts with major U.S. customers, Avantus, Clearway, Treaty Oak and others, and we have more than 3.5 gigawatts of 2027 capacity under contract. Section 232 is now enforced with minimum import prices and tariffs that are reshaping the competitive landscape in T1's favor. G2_Austin is under construction with its deal structure complete, all equipment in the U.S. and MEP installation underway. Our institutional equity and convertible debt investors have been remarkably supportive.

We are in negotiations with certain institutional investors under exclusivity with certain exceptions to pursue a comprehensive primarily debt-based financing solution for G2_Austin Phase 1. What hasn't changed is the North Star, building the first vertically integrated American silicon-based solar company on domestic polysilicon and wafers from Hemlock and Corning, domestic cells from G2_Austin, domestic modules from G1_Dallas and technology we now own outright. That vision is intact. The demand for what we're building is as strong as it has ever been, and we believe we are closer than ever to delivering it.

What I can tell you is that every member of this team from the floor of G1_Dallas to the construction site at G2_Austin to our headquarters in Austin is working with urgency, purpose and conviction. We are executing the plan, and we look forward to continuing to demonstrate that in quarters ahead. Thank you all for joining us this morning. And with that, I'll turn it back to Jeff to coordinate the Q&A session.

Jeffrey Spittel: Thanks, Dan. Operator, we'll now open up the line for questions.

Operator: [Operator Instructions] Our first question comes from the line of Philip Shen of ROTH Capital Partners.

Philip Shen: In terms of the debt-based financing solution, I was wondering if you could give us a little bit of color on what's driving the delay. Big picture, the polysilicon 232 is very helpful for you. But did the announcement in August actually delay your financing? For example, are the potential counterparties in your debt-based financing solution waiting for the approval for your 232 onshore program that allows you to offset 232 tariffs?

Daniel Barcelo: Thanks, Phil. The lenders there are not waiting for those aspects of it. I'd leave it at it. We've been rigorous in trying to close these comprehensive solutions, and we still have confidence that we will do that, but we have been rigorous in that. It is not related to 232. I would suggest that it's more related to certain processes that parties have. We can't really share too much details regarding counterparties, but we shifted now. I think the important parts are that we have a very high-quality collateralized asset with about $100 million of senior debt, and we have a fully ramped and loaded module facility.

We have a cell facility that's undergone a lot of construction with zero leverage, and we have huge 232 tailwinds. So in order to finance those aspects, I think our starting point is very, very strong, both corporately and both on our base asset of G1. Evan, would you like to touch a little bit more about the financing and the progress you're making there?

Evan Calio: I mean we're just -- it's our singular focus. We're focused on it, kind of where we are relates to strategic decisions that we made that we think are in the best interest of the company. But we're moving forward, and we'll look forward to announcing it once completed.

Philip Shen: Okay. All right. Next question here is on kind of when G2 is expected to start operations. I think you guys had been saying Q1 in today's deck. It looks like timing is now April. When do you have to secure the financing by in order to keep the current April ramp target intact? Is it within the next month? Or do you have the ability to wait two or three months? Just give us a sense of that timing.

Daniel Barcelo: Yes. I'd say the first thing is what we've done is we've been attempting to keep the schedule on track with the absence of closing that financing as we had thought we would do earlier. Regarding the schedule, a lot has been done. Process equipment very, very, very importantly, is in the United States. It is in warehouses. Our long lead facility equipment and key materials were ordered early in the project development. They all have set delivery dates, and we're tracking that to our key milestones. Permitting is on track. Access to power and permanent water is on track. Solid progress is made on construction on site.

What we'd say is that assuming we're doing financial close by year-end, we would expect to finish construction, installation, commissioning and ramping by about midyear. I would look at the slide of the first half production from March towards April as reflective of delays in financing, but many, many components of this project are continuing full steam ahead. David, would you like to give a little bit more color on the ground and what's happening to keep the project tracking well?

Unknown Executive: Absolutely. And I think you noted that the key thing is we've secured and have set delivery dates for all long lead items. That's not just our process equipment, but that's all the building infrastructure needs. So that gets rid of a major choke point. Our steel is up, our concrete in, our decking is down. We're putting walls on the building. So the project itself is tracking very well, and we've done a really good job of positioning ourselves not to get that choke point of long lead equipment, which is what's holding up most construction now. So once we get full financing, we're positioned to be able to really make up some good schedule time.

Evan Calio: Yes, sure. No. I mean I'd only add, Dan, to your points and the schedule is that the bridge that we're crossing to the ramp-up for G2 has significantly improved. I mean you're looking at year-over-year at -- not even at leading-edge pricing, a $0.05 a watt increase in a U.S. with an imported cell, right? So the period that the facility is ramping, we will be selling modules at better margin, which helps to increase the profitability through that ramp period.

Philip Shen: Okay. A couple more and then I'll pass it on. As a follow-up to the last topic, do you guys own the equipment that has been imported into the U.S.? Or is it in the U.S. but owned by a vendor? And the second question is on module pricing. You guys talked about the imported cell with U.S. assembled modules being in the mid-30s. With the MIP at $0.38 with an ad valorem tariff of 15%, do you see potential for being able to price higher than mid-30s for that imported cell product? Or if not, why not? And kind of maybe give a little color as to why you're in that mid-30s pricing level?

Daniel Barcelo: Yes. First question, we own the equipment fully 100% unlevered other than corporate debt. So that's all the equipment. And that goes for all of the assets that we've been purchasing to build G2. Regarding pricing, we do see very, very, very strong pricing. I think given the nature of the types of investors we have, large utility scale customers that are some of the best pedigree names in the market. Obviously, those are strong customers. We're seeking out long-term strategic relationships with them. We do not do C&I. We're not doing residential. So from the largest utility scale, high-quality customers, we're now seeing it in the mid-30s for the imported sales going towards 40 and mid-40s for domestic sales.

So on pricing, I think that the MIP and the duties have been quite a night and day scenario for a post-232 world, and those very large customers are responding to that pricing. As you know, we had a Commerce Department waiver on our duties for 1.7 gigawatts. We have had discussions with Commerce regarding an onshoring plan and awaiting guidance there. We will be pursuing a robust onshoring plan to ensure that while we're building and creating American jobs and creating American jobs using Hemlock polysilicon or Corning wafers in our products that we'll get as much credit as possible on an onshoring plan.

I think those two components really give us a really interesting ability to serve these customers with a much better advantaged price relative to competitors that don't have that. On pricing, Evan, do you want to talk a little bit more about leading-edge contracts and about the 22 gigawatts of pipeline we have?

Evan Calio: Yes. I mean they have been moving up incrementally. And those prices in mid-40s, mid-30s are where they are today. I think your question was -- and so when we lock in contracts like that, we're using the import waiver. So we're locking in our cell costs. So we know what our cost of sales are when we lock in a margin. Now could it go higher? Certainly. I mean there's been conversations. I know you've mentioned it on potential mix going higher. They go higher, that price goes higher. The second largest variable is how is the onshoring plan going to be scored.

The people that -- the players that are setting price should be at a higher level because they should be subject to the net generally, right? If you just look at the composition of the market, we think we'll have a relative advantage. We don't know yet. The reason being we have over $1.3 billion to 2030 commitment for U.S. polysilicon and wafer. I mean that is significant, that is unique relative to peers. And at least on Phase 1, it's $510 million of new capital investment in the polysilicon supply chain. And it's going to be more than double that if you get to Phase 2 over this kind of three-year period.

So significant elements of both of the primary considerations that we think they'll be using to evaluate onshoring plan and onshoring plan should be, are you going to get relief from the MIP and/or the ad valorem tariff? So does that help answer your question, Phil?

Philip Shen: Yes. Thank you. And one more actually here. In terms of the timing of the onshore program and whether or not you're approved, could we see that near term sometime maybe in December? Or do you think there it could be delayed, especially with the drama that's happening around NVIDIA?

Daniel Barcelo: Yes. Let me have Andrew Munro, our Chief Legal and Policy Officer, is on the line. Andy drives a lot of our policy and works closely on trade. Andy, do you want to talk about as much as we can about the discussions with commerce?

Andy Munro: Sure. We've been engaged in very productive discussions with Commerce. As evidenced by the waiver that we obtained. We're in close contact with them and expect to be meeting with them again very soon. As Dan has said, we think we're very well positioned to get a very favorable onshoring deal. It's possible that things could be delayed a bit, but we're certainly working productively with Commerce now. So we can't guarantee any date, but certainly, Commerce is working on this and focused on doing onshoring deals in the near future.

Operator: Our next question comes from the line of Greg Lewis of BTIG.

Gregory Lewis: Obviously, a lot was just asked, but I guess I had a question around, clearly, the pricing outlook has improved. You've been successful in onboarding or signing new supply deals. I guess as we think about the potential financing, has there been thought as we look to secure new offtake customers about potential prepayments on any of that on potential orders just to kind of maybe alleviate the total capital that might need to be raised here?

Daniel Barcelo: Thanks, Greg. We've explored multiple options, multiple directions, trying to optimize for both the tenor, the price and the cost of what we do. We've been quite active in terms of working with our suppliers to structure and time out payments for vendors and key vendors, both in Texas vendors and equipment vendors. As I mentioned before, we outright own all of the equipment. There's a lot of arrows in our quiver in terms of how we do different things. I don't really want to get into the details of what we can pull or what we can't pull, but we do right now have exclusivity with certain exemptions with certain institutional investors and those negotiations are ongoing.

And that's towards that full comprehensive solution, which would be primarily debt based. Evan, would you like to touch on financing or other aspects or bridges towards that?

Evan Calio: Yes. No, look, we have had prepayments. To be clear, you can see them on our balance sheet. I think there's tension of a lot of different factors in terms of what you're trying to optimize. I mean, we kind of started out initially in a kind of cost-plus environment, multiyear. That wasn't kind of really optimized over time in our conversations, and we're now really pushing more towards price and more limited duration, right? That's the kind of better trade for the newer contracts that we're negotiating. Deposits are an element, deposits also kind of choose some credit. 100% realize that as a tool.

We also can use that here near term because the 232 also really kind of accelerated the typical capital structure to build a module because you had to get cells in the country very quickly in a different way than you normally would, right? So it kind of changed the typical working capital cadence on a contract. So those contracts, that would make sense, but you're using the capital there versus using it for construction. But yes, I appreciate it, and that's a good question.

Gregory Lewis: Okay. And then the other question I had was around, I guess, I don't remember the exact timing, but what I want to say 6 to 12 months ago, you made that investment into Talon. Any kind of update on that? I mean I believe those cells are scheduled to come online in '28. Do we have any sense if that's still the case and how those fit into a 232 world?

Daniel Barcelo: Yes. We did make an investment in Talon PV LLC, but I would defer questions towards Talon. The strategy behind that was being part of a robust ecosystem in Texas and having less capital-intensive type agreements to have more access to cells. That still could remain a strategy for us. The demand for those domestic cell is night and day from when we even made that announcement. But I would really defer questions towards Adam and Brandon and Talon regarding that.

Operator: Our next question comes from the line of Sean Milligan of Needham.

Sean Milligan: I guess when you look at next year's volume guidance, can you walk us through sort of how you're thinking about cells? So what's covered under the waiver that you received, maybe what you already have in inventory and then what you expect from the ramp-up of G2 next year given the timing? I'm just trying to get a sense for kind of the cell outlook for next year for you.

Daniel Barcelo: Sure. I'll talk on schedule and then let Evan give a little color on the ramp-up on the other pieces. But on the schedule side, again, assuming we're going to do the financial close by year-end, we'd expect to finish the installation commissioning ramping by about midyear. As you're doing commissioning and ramping, cells are produced. Those cells are, in many cases, viable cells that can be included in terms of that. So we'll be building that inventory as this equipment ramps. There'll be varying qualities of those cells, but that commissioning process and ramping process, I just want to be crystal clear, does produce functioning commercial cells.

So as we get towards about midyear to get to full ramp, then we'll be running operations at a higher volume. So for 2027, we'd expect to see and have a lot of volume for that. Evan, do you want to talk a little bit about the contracts and what phasing we have on those contracts?

Evan Calio: Yes. I mean, look, the cells imported were for 2027, right? So we're building modules. That's why we're converting the cells into modules for delivery in 2027 now. That's why we carried some inventory out of the quarter, and we'll be carrying some inventory out of the year, less than the third quarter, but still carrying inventory into 2027. I would say, look, on G2, Dan and David laid out the ramp-up and the timing. But in terms of -- from a commercial perspective, and the demand is incredible, right? There is very limited product if you're a seller of a G2 cell. And so that is an easy contract to enter into.

We have entered into limited contractual capacity for 2027 right now and some of the other '27s have moved into '28. And so we're limiting our contractual exposure. you appreciate contracts have LDs, other elements until the comprehensive financing is completed, until we have better visibility, and we know that we can sell those cells at attractive margin relatively easily.

So the balance will be all imported cells and the imported cells, the additional contracts, right, that could be signed today, but we need to wait to fully assess our onshoring plan or how our onshoring agreement is finalized to fully understand what my cost structure is for that imported cell because there is a wide band, it's a $0.12 band between no credit and full credit on that cell, right? And so where am I exactly on that spectrum? That would then enable me to price the balance of merchant capacity, and we'll have some, which we're not going to disclose at this point that are allocated for G2, but we're being conservative on contracting given those variables.

Daniel Barcelo: Yes. And I would just add that there's a lot of noise around AI and the data centers and moratoriums. But what we get is, again, from very large utility-scale developers focused on '27, '28, touching '29 for real projects with real hyperscalers. That demand is very, very real. Solar and storage is dominating most of that growth as the markets await for turbines and gas and other solutions. So solar and storage is still in a dominant, dominant demand aspect. And again, from the 232 perspective, night and day from how we feel we're positioned for that.

Sean Milligan: And then on the COGS side, I know if you go back to last year and then earlier this year, the COGS per watt were moving around a little bit. It seems like the last two quarters you settled in, it's been a little more consistent. I understand the cell side is dynamic here. But everything outside the cell, are you seeing relatively consistent pricing now for you all from the COGS side?

Daniel Barcelo: Yes. look, when there was the reciprocal tariffs that came out, there was a lot of volatility, particularly on glass, frames and other BOM. I think we've seen a lot more stabilization in the supply chains there and a lot less volatility other than the cell. Cell pricing since the time you mentioned has come down. More recently, during the 120-day import window for 232, there's been a tick up in that pricing. That's just because of the amount of demand and connected to even ourselves with the import waiver we have of 1.7 gigs. But I'd say in general, we've seen a much more stabilization on the rest of that supply chain. That's from non-cell.

Evan Calio: Yes. I'd only add that as we ramp our capacity and we move to 2027 target, your conversion costs continue to compress, right? So as you scale, the conversion element, which can save you a few pennies a lot depending on where you are in capacity is pressuring. And I'd say that cell pricing, yes, stabilized, but it also did uptick as you had a lot of buyers looking to import cells inside of this window. And if you look on the other side of this window and cells that I could buy to be delivered for December 5, they're significantly lower than the price that they are today.

And whether or not that's attractive to purchase them is going to depend upon the outcome of your onshoring and how the ad valorem math works on your cost structure. Yes.

Operator: Our next question comes from Nick Lipinski of Vertical Research Partners.

Nicholas Lipinski: I was wondering if you could provide any color on the imported domestic sales split on the recent 1.6 gigawatts of offtake agreements. You mentioned a blend. And I just wanted to see if you could put a finer point on that, if there's anything contractual or if you have some ability to flex that.

Daniel Barcelo: On the import duty, obviously, just to be clear, you're saying these are imported cells with the wafers for. So of that amount, the full amount would have been imported from non-U.S.

Evan Calio: He's asking for the contract mix. He's asking for the amount of contract. They're significantly weighted towards an imported cell. As we've mentioned, we have very -- we've limited strategically the blend on a G2 cell until everything is locked. And given they're also easier to sell, right, like we have contracts that we could execute that we're holding until we understand the full onshoring plan, right? And until we understand the exact timing date on financing, which cascades through the schedule, so we can comfortably contract.

Daniel Barcelo: Foundationally, that imported plan can connect and expand because a portion of that 1.6 gigawatts does touch into domestic cell, either in connected relationships or through ongoing negotiations with those parties. We were very selective in who we allocated that 120-day window for. And those customers are, in our minds, part of our strategic customer base that we hope would also transition towards more domestic content. And embedded in your question is the right point. A lot of customers are looking for blending to maximize the benefits of different tax incentives that may exist to minimize cost structure and also to ensure that they have a stronger and growing domestic content, which a lot of customers are seeking.

So we've used those waivers very, very strategically. On the onshoring plan, we would expect to do the same. And again, we don't have the details from commerce about what relief we get, but we do think we're very well positioned for it. While we don't have a domestic cell, obviously, a lot more is going to be focused towards the imported cells and building as much as G1 flow as we can and keeping those volumes high. We do expect to sell out 2027. We do see very good pricing at G1.

As we ramp up and get into our 2027 deliveries of domestic cells, we'd look to bridge a lot of those both 120-day customers and some of the onshoring customers into that domestic cell business.

Evan Calio: Yes. And I'll also add to Dan's point is that since we have the pre-232 Corning wafer supply contract, our domestic content percentage is higher for Q2 than others. And so it has more domestic content. That's what they're blending for domestic content largely. And so that's a relative strength, at least of our offering.

Nicholas Lipinski: Great color. And I just wanted to ask one more on NRI. That business had been around for a long time and mainly a data center customer base, if I'm not mistaken. What's different in your approach to commercializing this versus what they were doing historically? And maybe more specifically, what was the contribution in the quarter for the two months you had it, your expectations for growth and the ultimate potential of that business? And any way you'd frame the pipeline of opportunities and how that might have changed during these first few months of ownership here?

Daniel Barcelo: Thanks very much. We're not breaking out NRI separately yet. We're in an integration phase. We'll get back and get more color on that in due course. Just to re-anchor NRI for the benefit of others that don't necessarily know the history like you do, I think there's 3 components to NRI that are very important. First of all, is the network operating center, which has a long tail of O&M fees and revenues related to battery monitoring across the United States. The second is very important is about controllers for both BMSs and EMSs. More and more, most battery systems require American controllers. We thought that, that part of the business is a very, very important aspect for it.

And then finally, is a part of the business with BESS integration, and that is delivering to bespoke customers, both in the United States and international solutions for it. We are looking to expand on all three of those areas. On the BESS integration side, a lot of customers are looking for domestic LFP cells. Those are very hard to find across the board. As people scramble for those domestic BESS cells, they're looking for better and better margin. So we are working in that market environment as are most other of our competitors to secure those cells because that's what the customers want from a domestic content and from a NAFTA perspective.

On the other two areas, we feel very confident and robust demand for the controller solutions. A lot of the customer mix for NRI is legacy relationships. Some of them smaller parts are government related. Some of them are international, some of them are domestic. long existing relationships. Our core strategy of incorporating NRI was to be additive around our solar customers. A lot of the solar customers' projects all have or increasingly will have storage solutions attached to that.

And we felt that having a stronger sales operations, sales engineering and sales outreach that could afford many of our utility scale customers a stronger engineering and sales outlook there was an important offering of what we can deliver to customers.

Operator: This concludes the question-and-answer session. I would now like to turn it back to Jeff Spittel for closing remarks.

Daniel Barcelo: Before we go to Jeff, I would just like to close, look, we are extraordinarily focused on financial close. We're continuing to advance G2_Austin. We will update investors as we get towards that. It's really been night and day in terms of demand post 232. The waiver has been very powerful. The new contracts we announced are a strong indicator. Our pipeline is robust. Pricing is good, and we're really excited about advancing G2_Austin and getting these domestic cells online and helping to build the American solar industry. With that, Jeff, I'll turn it back to you for closing comments.

Jeffrey Spittel: Thanks, Dan. Well, thank you, everybody, for participating today. We spent a lot of time talking about the market today, and we'll be at RE+ next week. Please feel free to pay us and stop by and visit with us, but we look forward to seeing a bunch of you on the road next week. This will conclude today's call.

Operator: Thank you for your participation in today's conference. This does conclude the program, and you may now disconnect.

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