Bloom Energy Corp (BE)

ITEM 2—MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF

OPERATIONS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements contained in this Quarterly Report on Form 10-Q other than statements of historical fact, including statements regarding our future operating results and financial position, our business strategy and plans and our objectives for future operations, are forward-looking statements. Generally, the words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “predict,” “project,” “potential,” “seek,” “intend,” “could,” “would,” “should,” “expect,” “plan” and similar expressions are intended to identify forward-looking statements. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking.

Forward-looking statements in this Quarterly Report on Form 10-Q include, but are not limited to, our plans and expectations regarding future financial results, including our expectations regarding: our ability to be successful in the AI data center market and new international markets; the rate of AI adoption and demand for data centers; our ability to innovate, develop new products and improve upon our existing products; our ability to anticipate and address customer demand; our strategic partnerships with SK ecoplant Co., Ltd. and parties which provide financing and capital for project financings; our competitive position in the energy market for on-site power; future deployment of our Bloom Energy Server systems, Bloom Electrolyzers, and other solutions; our ability to increase efficiency of our products; our ability to market our products successfully in connection with the global energy transition and shifting attitudes around climate change; our business strategy and plans and our objectives for future operations; operating results; the sufficiency of our cash, our cash flows from operating activities, and our liquidity and our ability to obtain financing; projected costs and cost reductions; our ability to increase production capacity and achieve cost reductions in our fuel cell products and installation requirements; the adequacy of our agreements with our suppliers; management’s plans and objectives for future operations; our ability to repay our debt obligations as they come due; trends in average selling prices; the success of our customer financing arrangements and ability to secure financiers to support customer financing needs for our product deployment; capital expenditures; warranty matters; outcomes of litigation; risks related to cybersecurity breaches, privacy and data security; the likelihood of any impairment of project assets, long-lived assets and investments; trends in revenue, cost of revenue and gross profit (loss); trends in operating expenses including research and development expense, sales and marketing expense and general and administrative expense and expectations regarding these expenses as a percentage of revenue; legislative actions and regulatory and environmental compliance; government shutdowns; general business and macroeconomic conditions in our markets including inflationary pressure; our supply chain (including any direct or indirect effects from the Russia-Ukraine war, armed conflicts in the Middle East, or geopolitical developments related to China); the impact of tariffs on our supply chain and fuel cell product; the impact of changes in government incentives, including the impact of the Inflation Reduction Act of 2022 (the “IRA”) and the One Big Beautiful Bill Act (the “OBBBA”); industry trends; our exposure to foreign exchange, interest and credit risk; and the impact of recently adopted accounting pronouncements.

You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Quarterly Report on Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, operating results and prospects. We operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements we may make in this Quarterly Report on Form 10-Q. We cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or occur. Actual results, events or circumstances could differ materially and adversely from those described or anticipated in the forward-looking statements.

The forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements made in this Quarterly Report on Form 10-Q to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q or to reflect new information or the occurrence of unanticipated events, except as required by law. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements.

Our actual results and timing of selected events may differ materially from those anticipated in these forward-looking statements as a result of many factors including those discussed under in the section titled "Risk Factors" in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (“2025 Form 10-K”), as well as those described from time to time in our others filings filed with the Securities and Exchange Commission.

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The following discussion and analysis should be read in conjunction with our condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q.

Overview

Description of Bloom Energy

Bloom Energy is a global leader in onsite power generation, delivering a foundational platform purpose-built for the digital era and the global energy transition. We manufacture a versatile fuel cell energy platform, supporting the commercial availability of two primary products: the Bloom Energy Server® fuel cell system for generating electricity and the Bloom Electrolyzer™ for producing hydrogen. Our primary product, the Bloom Energy Server is a proprietary high-temperature solid-oxide fuel cell technology that converts fuels—including natural gas, biogas, and hydrogen—into electricity at high density without combustion or moving parts, achieving lower emissions and higher efficiency than legacy systems.

For additional overview information, refer to Part I, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, sections Overview and Key Macro Trends in our 2025 Form 10-K.

Developments With Respect to Factors Affecting Our Performance

Freight, Logistics and Transportation Costs

Global freight and logistics markets remained volatile during the first half of fiscal year 2026, with continued pressure on ocean, ground and specialized heavy-equipment transportation rates. While transportation availability improved relative to peak levels experienced in prior years, higher fuel prices, labor costs, and routing inefficiencies related to geopolitical conditions contributed to elevated logistics costs. In addition, on a selective basis we also incurred higher logistics costs in connection with expediting deliveries of materials and supplies by air carrier to manufacture, and deliver our Energy Server products to meet customer timelines.

Given the size, weight, and modular configuration of Bloom Energy Server systems and related balance‑of‑plant components, changes in freight pricing can meaningfully affect our cost of revenues and project-level margins, particularly for large multi-megawatt deployments and international shipments. We continue to pursue mitigation strategies including negotiating indexed freight arrangements where feasible, renegotiating air freight rates, optimizing factory-to-site routing, consolidating shipments, and increasing regional sourcing; however, there can be no assurance that such actions will fully offset future freight rate increases, especially in periods of elevated demand or fuel price volatility.

Supply Chain Update

Since the discussion of our supply chain contained in Part 1, Item 7, Management’s Discussion and Analysis of Financial Condition and Result of Operations, section Other Factors Affecting our Performance in our 2025 Form 10-K, although throughout 2026 there has been a general worldwide shortage of electronic components, we have continued to not experience significant component shortages, electronic or otherwise to date. Approaches we have taken as we continue to scale our manufacturing include supplier diversification and qualifying multiple suppliers for single or limited source components, enhancing our predictive analytics capabilities, and employing flexible sourcing strategies. As we continue to scale our business, we have been pro-active in working with our suppliers to ensure continued adequacy of supply while also maintaining our quality standards. Such strategies have included entering into long-term contracts, non-cancelable purchase orders and, in select cases, take-or-pay contracts where demand for such items is competitive and where components are highly dependent upon underlying scarce commodity items. We do not currently anticipate experiencing supply chain shortages which would impact our 2026 production forecast; however, we cannot give assurances as to potential future developments or their related impacts.

On July 8, 2026, a report was published by a short seller containing allegations regarding, among other things, our supply chain, including the sourcing and sufficiency of certain raw materials used in our products. As stated in our Current Report on Form 8-K furnished on July 9, 2026, we rejected the report’s conclusions regarding our supply chain, and we believe we have sufficient supply of the relevant raw materials to meet our current fuel cell demand and backlog. Publications of this nature, whether or not accurate, have resulted in significant volatility in the trading price of our common stock, and we cannot predict whether similar publications may occur in the future or their potential impacts. We have incurred, and may continue to incur, costs in connection with evaluating and responding to the report, and any related inquiries or demands could result in additional costs and divert management’s attention. See Part II, Item 1A, “Risk Factors.”

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Continuing Impact of Tariffs

During the year ended December 31, 2025, pursuant to the International Emergency Economic Powers Act (“IEEPA”), the U.S. government announced significant additional tariffs on products imported from various countries, including countries where we source materials used in our Energy Server products. In February 2026, the U.S. Supreme Court ruled that certain tariffs imposed under the IEEPA were unlawful and required refunds of such tariffs collected, which refunds we are also separately pursuing. However, following the Supreme Court’s decision, the U.S. presidential administration invoked other laws to collect tariffs and announced new temporary ten percent tariffs on imports from all countries, in addition to any existing non-IEEPA tariffs. Following the expiration of such temporary tariffs, in late July 2026 the U.S. presidential administration imposed new tariffs of 10% to 12.5% target

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ITEM 7—MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF

OPERATIONS

Overview

Description of Bloom Energy

Bloom Energy is a global leader in onsite power generation, delivering a foundational platform purpose-built for the digital era and the global energy transition. We manufacture a versatile fuel cell energy platform, supporting the commercial availability of two primary products: the Bloom Energy Server® fuel cell system for generating electricity and the Bloom Electrolyzer™ for producing hydrogen. Our primary product, the Bloom Energy Server is a proprietary high-temperature solid-oxide fuel cell technology that converts fuels—including natural gas, biogas, and hydrogen—into electricity at high density without combustion or moving parts, achieving lower emissions and higher efficiency than legacy systems.

We design, manufacture, distribute, and operate the Bloom Energy Server to provide resilient, distributed power for critical operations. Our mission is to make clean, reliable energy affordable, giving enterprises control over cost, resilience, and sustainability. Bloom serves Fortune 500 companies across the data center, semiconductor manufacturing, AI infrastructure, utility, and other industrial sectors.

Headquartered in Silicon Valley, Bloom Energy employs more than 2,000 people worldwide and manufactures its systems in the United States. Bloom has its Energy Server systems deployed across approximately 1,100 sites in 9 countries, empowering businesses and critical infrastructure worldwide.

Energy Market Conditions

The global energy transition has created new challenges and opportunities for the power sector. Shifts and uncertainty in the policy, regulatory, and market environment impact our business. Increasing electricity rates, decreasing energy security and reliability, and delays in the development of transmission infrastructure and grid interconnection as well as other time-to-power challenges have led to increased customer interest in our power solutions. Increasing demand for power has created a mismatch in supply and demand. This supply and demand mismatch globally has threatened energy security, reliability, and availability and forced policymakers, utilities and business alike to reimagine energy generation and procurement strategy.

We enable customers to address these energy market challenges by offering flexible solutions designed to provide cost predictable, resilient, and reliable energy in a timely fashion. As customers and utilities navigate the energy transition and evolving landscape, the ability of our power solutions to fit their business, economic, regulatory, and policy needs depends on a number of factors, including natural gas availability and pricing, electrical interconnection costs, availability and timing, redundant back up power requirements, cost requirements, and sustainability profiles. These factors may influence a customer’s decision to pursue an alternative on-site power solution like ours.

Proposed and enacted policies that have emerged in 2025 may also affect customer demand for power solutions. For example, changes to permitting rules could accelerate domestic fossil fuel infrastructure production, while proposals to limit environmental reviews under the National Environmental Policy Act and other statutes could incentivize investment in, and reduce the cost of, fossil fuels, including natural gas. FERC is now addressing a DOE proposed rulemaking on large load interconnection that could significantly impact new onsite generation by creating uniform pathways for onsite fuel cell deployment at data centers. At the same time, federal directives and state proposals to halt new permits for wind projects, particularly offshore wind, could slow renewable energy adoption and decrease the projected available supply of renewable energy. Some data center customers and other large power users have signed exclusivity arrangements with their utilities, which can introduce limitations to move to on-site solutions. Rising natural gas costs in some regions, increases in gas distribution rates, limited availability of supply, and disruptions in global gas markets are some of the market challenges we face, and can increase the cost of power solutions for customers. Bloom stands ready to meet these new challenges and opportunities.

Key Macro Trends

Demand for Power is Increasing, Driven by Data Centers and Artificial Intelligence. U.S. electricity demand has entered a new growth phase after years of limited expansion, driven by a rapid buildout of AI and cloud data centers and renewed investment in domestic manufacturing. AI workloads require significant and continuously available power, while reshoring across sectors such as semiconductors and advanced materials is creating new large loads. Existing electricity customers in states with heavy AI and cloud data center development are also raising concerns over rate increases they attribute to this new demand for power. These developments are reshaping demand patterns and increasing the need for dependable,

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rapidly deployable power sources.

Policy Support has been Increasing for AI leadership and Energy Security. U.S. federal policy discussions increasingly link AI competitiveness with energy availability, emphasizing the importance of reliable near-term power sources. Recent actions recognize natural gas as a practical bridge resource for meeting immediate load growth while longer-term decarbonization pathways evolve. Over the same period, certain renewable incentives have become more time-limited, affecting the pace and predictability of new renewable additions. We believe these shifts are influencing customer planning and procurement decisions as they evaluate firm, rapidly deployable power options.

Grid Constraints and Permitting Delays are Extending Time to Power for Traditional New Facilities and Expansions. As electricity demand accelerates, grid capacity is not expanding at the same pace. Extended permitting timelines and supply chain constraints dictate that transmission additions remain limited, and generator interconnection queues at the end of 2024 totaled 2,300 gigawatts, with typical timelines extending multiple years and further delays. Even with regulatory reforms, the timelines associated with system upgrades required for reliability and deliverability continue to translate to long lead times. “Time to power” has become a central constraint for organizations planning new facilities or expansions providing an opportunity for power sources like our products that can be co-located on-site where the demand is needed and be grid-independent..

According to a study published in December 2025 by the Lawrence Berkeley National Laboratory, the time from initiating a request for interconnection to the grid to the start of commercial operations has more than doubled to 55 months in 2024 from less than two years in 2008. Bloom Energy Server systems can be configured as on-site fully-islanded, microgrid solutions that are not interconnected to the grid, which often can provide a customer power in months instead of years. In many markets, utilities have acknowledged delays in serving large load customers, which we believe makes the Bloom Energy Server system an attractive solution.

In addition, our fully-islanded microgrid solutions can provide power on-site, without the need for transmission and distribution system upgrades that often are required before a customer can interconnect to the electrical grid. We are seeing greater interest in fully-islanded, microgrid solutions among data center customers because of these interconnection-related delays. If a customer desires a “grid parallel” solution, where it can withdraw system power in combination with the Bloom Energy Server system, required interconnection studies and lengthy interconnection queues may remain, eroding the time to power value proposition, though ongoing regional and national policy developments may significantly reduce these queues, increasing the value of onsite generation solutions.

Shift Toward Onsite Power Generation is Occurring. To address schedule certainty and bypass grid bottlenecks, large-load customers—particularly data center operators—are increasingly evaluating onsite generation as part of their energy strategy. Onsite systems, when islanded, can allow customers to control deployment timelines, secure reliable baseload supply and reduce delays associated with lengthy permitting and interconnection processes. Industry analyses and surveys indicate meaningful growth in distributed and onsite generation through the end of the decade.

Our islanded microgrid solutions allow data center and other customers the ability to skip the interconnection queue and start construction. A key to this solution is that our load following capability allows us to follow a customer’s variable loads without the need to import power from the transmission grid. We believe avoiding lengthy interconnection queues is key to unlocking time to power for our customers.

Limitations Among Traditional OEMs and Utilities are Extending Delivery Timelines. Traditional power generation OEMs are experiencing extended delivery timelines as demand for firm power solutions increases across data centers, industrial facilities and utility markets. Lead times for turbines, engines and other conventional equipment have lengthened due to global order volumes, supply chain constraints and component availability. In some cases, delivery windows span multiple years, limiting customers’ ability to add capacity on required schedules. We see these constraints contributing to increased interest in modular, rapidly deployable power solutions.

Our utility customers are recognizing the challenge of keeping pace with the growing demand for power. Aging infrastructure, coupled with transmission and distribution bottlenecks, are making it more difficult for utilities to integrate additional sources of energy to add capacity. Building new transmission and distribution infrastructure is expensive, takes many years, and would likely cause utility rates to increase. As demand for power continues to grow, utility companies are struggling to meet the soaring demand of data centers, while customers’ time to power becomes increasingly important.

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Utility companies are exploring alternative means of producing and supplying energy to their end customers, including our Energy Server systems. We entered into agreements with utilities in 2024, including a landmark 1 GW supply framework agreement with a customer and began executing on the order in 2024.

Utility Load Growth and Capacity Constraints are Creating Affordability Pressures. Utilities face rising load growth, cost pressures, and heightened scrutiny from both commercial and residential customers. Large users cite higher rates, reliability challenges and extended interconnection timelines, while households face increased affordability concerns as electricity takes a larger share of monthly spending. These dynamics are prompting utilities to explore more flexible and capital-efficient ways to serve load, including behind-the-meter and sleeved on-site generation arrangements that can be deployed more quickly and without extensive grid upgrades.

Our islanded microgrid solution also creates benefits for consumers by reducing congestion charges resulting from constraints on the transmission grid and avoiding the need for network transmission investments and upgrades. In addition to our distributed generation microgrid solution serving a single customer, utility companies can employ it to serve as an energy transmission asset, helping them avoid the costs of new transmission and distr

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