374Water Reports 280% Revenue Growth and Reduced Net Loss in Q2 2026

374Water Inc. reported significant financial developments in its latest 10-Q filing for the second quarter of 2026, showcasing a substantial increase in revenue and a notable reduction in net loss compared to the same period in the previous year. The company generated revenues of $2.26 million for the three months ended June 30, 2026, a 280% increase from $594,967 in the same quarter of 2025. For the six-month period, revenues reached $2.81 million, up 147% from $1.14 million in the prior year. The gross margin also improved, moving from a loss of $276,366 in Q2 2025 to a gain of $1.98 million in Q2 2026.

Despite the revenue growth, 374Water reported a net loss of $2.70 million for the second quarter, down from a loss of $4.58 million in the same quarter of 2025, reflecting a 41% improvement. The decrease in net loss was attributed to increased revenues and reduced operating expenses, which fell to $3.60 million from $4.36 million year-over-year. The company noted a significant reduction in professional fees and research and development costs, which contributed to the overall decrease in operating expenses.

Strategically, 374Water has made notable advancements, including the successful completion of a factory acceptance test for its OC San contract, which allowed the company to recognize previously deferred revenue. The company also executed a license agreement with the City of Orlando, expanding its operational footprint and capabilities. Additionally, 374Water has been actively managing its capital structure, issuing convertible notes totaling $2.96 million during the first half of 2026, which has bolstered its cash position.

Operationally, 374Water's customer base remains concentrated, with one customer accounting for approximately 88% of total revenues in the latest quarter. The company has also seen a shift in its inventory, which increased to $1.64 million as of June 30, 2026, compared to $1.47 million at the end of 2025. The company’s total assets rose to $12.99 million, up from $11.41 million, while total liabilities surged to $10.01 million, primarily due to the issuance of convertible notes and increased operating lease liabilities.

Looking ahead, 374Water's management expressed concerns regarding its ability to continue as a going concern, citing the need for additional financing to support operations over the next twelve months. The company is exploring various funding avenues, including public equity markets and private equity financing, to ensure it can meet its financial obligations and continue its growth trajectory.