This article first appeared on GuruFocus .
-
Customer Orders:Up 3x year on year to just over 30 megawatt hours in H1.
-
Order Book:Just under 80 megawatt hours, excluding the FlexBase contract.
-
Project and Grant Income:GBP1.7 million, up from GBP0.8 million in the prior-year first half.
-
Gross Loss:Down 60% year on year.
-
Net Loss:GBP12 million, a GBP1.5 million reduction year on year.
-
Cash Position:GBP10 million cash at end of H1.
-
Inventory:GBP40 million to deliver on increased second-half orders.
-
Warranty Costs:Down to GBP0.2 million from GBP0.9 million year on year.
-
Gross Margin:Pickup in gross margin over time, driven by higher factory volumes absorbing overheads and shift from VS3 to ENDURIUM.
-
Product Cost Reduction:60% cost taken out of VS3 product; targeting 66% cost reduction for all product shipped in early 2027, with potential further 50% reduction through 2030.
-
Pipeline:Just under 13 gigawatt hours on an unrisked basis across order book, framework, and development pipeline.
-
Market Share:Targeting 5x increase to just under 5% of the flow battery market.
-
AI Data Center TAM:$45 billion opportunity, with 15% cost advantage on inference and 12% on training versus incumbents.
-
FlexBase Project:1.5 gigawatt hour project, 1.5x the average electricity load of Zurich; fulfillment phase expected to begin mid-next year.
-
Power Dispatch:11 gigawatt hours dispatched from batteries, up from 10 gigawatt hours previously announced.
Release Date: September 21, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
-
Customer orders increased 3x year-on-year to over 30 MWh, with an order book of nearly 80 MWh, indicating strong commercial momentum.
-
Gross loss reduced by 60% year-on-year, driven by improved margins and lower warranty costs, reflecting better operational efficiency.
-
Product cost reduction of 60% achieved on VS3, with ENDURIUM expected to deliver a further 66% cost reduction by early 2027, enhancing competitiveness.
-
Strong track record with 11 GWh of power dispatched from installed batteries, providing proven reliability and data for customers.
-
Significant market opportunity in AI data centers, with a $45 billion TAM and a 15% cost advantage over incumbents, positioning Invinity for growth.
Negative Points
-
Net loss increased by GBP1.5 million year-on-year to GBP12 million, due to higher R&D spending and reduced recoveries from the Gamesa joint development agreement.
-
Cash position of GBP10 million with GBP40 million inventory, but cash runway depends on unwinding inventory, posing liquidity risks if deliveries are delayed.
-
Disappointment with UK Cap and Floor scheme outcome, where projects were not awarded despite strong technology, potentially impacting UK manufacturing and job creation.
-
Copwood project commissioning delayed due to external grid connection issues, now expected by end of year, causing revenue recognition delays.
-
Competition from lithium-ion batteries, which dominate 98% of the market, remains a significant challenge despite Invinity's technological advantages.
Q & A Highlights
Q: Can you give a bit more detail on how you're going to manage cash over the next 12 months, between inventory, cash and customer receipts? A: CFO Adam Howard explained that cash runway is a function of both cash on the balance sheet and the GBP40 million of inventory built in the first half for delivery against the order book. Approximately half of that inventory unwinds in the second half for deliveries, with the remainder in early 2027, which underpins the 12-month going concern position in the interim statements.
Q: There's been a lot of press around the UK Cap and Floor scheme. What is your view on what happened and the chance of anything changing? A: CEO Jonathan Marren said the result was highly disappointing and that Invinity's projects appear to have been scored on generic, outdated assumptions rather than on technology quality or price. He noted strong support from stakeholders and that the company is engaging at very high levels of government, but could not forecast whether the outcome will change. He stressed the UK offers far less manufacturing incentive than the US (30% CapEx refund), EU and Japan, and that Invinity will keep pushing the case, including the potential to create around 1,000 jobs in Scotland.
Q: Within the 11 gigawatt-hours of pipeline, can you give more insight into what actually sits within those frameworks and what customers are involved? A: Chief Commercial Officer Matthew Harper said a healthy part of the business remains frontier developments, but the big change has been on the data center side, including the second phase of FlexBase. He noted a large and growing number of other data center opportunities from operators, builders and constructors globally are now part of that pipeline.
Q: Do you see FlexBase as a one-off, or is it a repeatable model? A: Matthew Harper said the team is laser-focused on getting the project right for that customer and is working through development details to serve this new market properly. The intention is to turn at least portions of it into a repeatable offering for further sites and regions. Jonathan Marren added that delivery runs to 2029-2030, with installation starting in about a year, and that the project is already opening up other opportunities.
Q: Where are you seeing demand outside North America, Europe and the UK? Is it China or India? A: Jonathan Marren said China has deployed more vanadium flow batteries than anywhere else, and Invinity's price points next year may be below where Chinese suppliers sell, with better performance, making China potentially interesting if approached sensibly. India is very cost-conscious and Invinity will only cherry-pick opportunities rather than chase low or negative margin business. He also flagged significant untapped European opportunities alongside FlexBase.
Q: You said the FlexBase engineering process is on track. Can you give more detail on progress toward a signed award? A: Matthew Harper said the project was awarded on Invinity's track record and concept, and over the next year the company will pass a series of stage gates delivering progressively more evolved engineering, proving the concept and commercial model, and building the actual component orders. He noted a key difference: rather than shipping containers, individual components will be shipped for full integration at the data center site.
Q: Do you have the manufacturing scale to deliver projects like FlexBase and other large-scale projects? A: Jonathan Marren said it takes about a six-month lead time to scale, typically driven by stack manufacturing. Building capacity ahead of demand would push unabsorbed overheads through the P&L and hurt profitability, but the company can scale quickly, tapping labor from oil and gas, graduates and apprentices. Facilities need only a dry enclosed area with a stable floor, so space can be found and brought online quickly with substantial orders.
Q: What is the status of US manufacturing plans and when will we hear more? A: Matthew Harper said there are tremendous advantages to US manufacturing for the US market, including production tax credits and customer tax refunds. The company is most of the way through site selection and is negotiating lease contracts, and has validated an initial team ready to step in. The final location will be announced once contractual details are locked in.
Q: What is driving the uplift in admin overheads and the movement in the bottom line? A: CFO Adam Howard said the GBP1.5 million movement is explained in Note 4 of the accounts, with half from a comparator effect as Gamesa joint development recoveries ended, and half from increased staff costs. He emphasized the staff investment is what delivers the 60% cost reduction and is already driving improved gross margins through better component costs and performance, while admin budgets are managed judiciously.
Q: Is selling a battery a one-off, or are there maintenance contracts, and how does revenue flow through? A: Adam Howard said 95% plus of revenue is recognized on delivery of the battery, with an ongoing long-term service agreement providing recurring revenue over time. For larger projects like FlexBase, a percentage-of-completion basis would make more sense, consistent with industry practice.
Q: Where are you seeing the main competition, and in what markets? A: Matthew Harper said the number one commercial competition is always lithium, which holds 98% of the world market. Other flow battery companies do appear, and the FlexBase tender attracted global interest including lower-cost bidders from China and India, but those were deemed not to have Invinity's track record. No competitor has yet credibly bested the markets where Invinity has won.
Q: Given the commercial focus, is a move to the US or a US listing on the cards? A: Jonathan Marren said including the US capital markets in thinking is absolutely true at the right point in time, given most projects and pipeline are there and US investors understand the story. However, the company remains committed to the UK, with the National Wealth Fund as a major shareholder, and maintaining London liquidity is a priority. A US listing is a possibility at the right size, but not imminent.
Q: Are you worried customers will delay orders waiting for products to become cheaper? A: Matthew Harper said it is always a concern but has not happened in the pipeline. By the time customers approach Invinity, most are commercial and industrial customers wanting to save on electricity bills immediately, or AI data
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
