Crown Electrokinetics Reports 206% Revenue Growth but Widening Net Loss in Latest Quarter

Crown Electrokinetics Corp. reported significant financial developments in its latest 10-Q filing for the quarter ending March 31, 2025. The company generated revenue of $2.8 million, a substantial increase from $682,000 in the same period last year, marking a growth of approximately 206%. This increase is attributed to new contracts secured across its Fiber Optics, Element 82, and Slant Wells divisions. However, the company also reported a net loss of $9.7 million, compared to a loss of $4.6 million in the prior year, reflecting a widening deficit as operational expenses surged.

Total operating expenses for the quarter reached $8.9 million, up from $2.7 million in the previous year, driven primarily by a $5.9 million increase in selling, general, and administrative expenses. This rise was largely due to higher professional fees and increased salaries and benefits. The cost of revenue also rose to $2.8 million from $1.7 million, with $1 million attributed to related party transactions with Horizon HDD, a subcontractor providing labor and equipment.

In terms of operational metrics, the company reported a cash balance of $22.5 million as of March 31, 2025, a significant increase from $13.7 million at the end of 2024. This increase was primarily due to financing activities, which provided $21.4 million in net cash, largely from the issuance of common stock through an at-the-market offering. The company’s accumulated deficit now stands at approximately $152.6 million, raising concerns about its ability to continue as a going concern, especially following the suspension of its common stock from trading on Nasdaq due to non-compliance with listing standards.

Crown Electrokinetics has also made strategic moves to diversify its operations, including the establishment of several subsidiaries focused on fiber optics and water infrastructure. The company incorporated Crown Fiber Optics Corp. in January 2023 and Element 82 Inc. in July 2024, aiming to enhance its capabilities in telecommunications and lead remediation, respectively. Despite these expansions, the company faces challenges in capital raising due to its current trading status and market conditions, which may impact its growth trajectory.

Looking ahead, Crown Electrokinetics anticipates growth in 2025 and 2026, although management has expressed uncertainty regarding the timing and scale of this growth due to the early-stage nature of its operations and external market factors. The company is actively working on a remediation plan to address internal control weaknesses and improve its financial reporting processes, which it hopes will stabilize its operations and enhance investor confidence moving forward.