Impairment and other charges

9 Months Ended

Sep. 30, 2025

Property, Plant and Equipment [Abstract]

NOTE 3 — Impairment and other charges

Long-lived asset impairment

In March 2025, due to higher-than expected indicative cost estimates for its first utility-scale project, the Company identified a triggering event for evaluation of impairment of its long-term assets. As the Company is in the development stage, focusing on developing and commercializing its technology, the Company assessed its definite-lived intangible assets, the Demonstration Plant, and other corporate assets for impairment as an asset group (the “Developed Technology Asset Group”). In March 2025, management performed a probability-weighted undiscounted cash flow analysis, incorporating estimated cash flows from the deployment of its

technology and the value of the underlying intellectual property, and the results indicated that no impairment was required. Additionally, in response to these higher-than expected indicative cost estimates, the Company initiated a value engineering process to assess Project Permian’s economic feasibility and to optimize its design to reduce costs. The Company temporarily paused further long lead equipment releases and engaged a management consulting firm to conduct a techno-economic analysis of clean, firm power alternatives and to assess the market potential of the Net Power Cycle product.

In the second quarter of 2025, the Company progressed its value engineering process to improve and validate commercialization pathways for the Net Power Cycle and introduced its integrated product offering, combining the Net Power Cycle with gas turbines with the goal of improving the cost-competitiveness of the Company’s technology and time to market for potential customers. Additionally, in July 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted, which enhanced the Section 45Q Tax Credit for Carbon Sequestration for enhanced oil recovery. The Company received initial results of the techno-economic analysis for the Net Power Cycle product, and the Company responded to a prospective customer’s Request for Proposal for Environmental Attribute Credits generated from carbon capture and sequestration at North American power plants. Based on these developments, the Company did not identify a triggering event that the Developed Technology Asset Group may be impaired as of June 30, 2025.

In late August 2025, the Company completed its assessment of the techno-economic analysis which identified slower than anticipated acceptance and deployment of the Company’s technology from previous expectations; the value engineering process identified significant cost reductions, but not to a level that is currently economic in the marketplace; and the engagement with potential customers identified time to market and cost as a significant factor to deployment of power solutions, both of which currently represent challenges for the Company’s Net Power Cycle product. The Company determined these factors would result in fewer deployments of the Company’s Net Power Cycle product than previously estimated and therefore, updated its long-range forecasts.

The Company determined that a triggering event had occurred requiring an impairment assessment of its Developed Technology Asset Group as a result of the feedback from potential customers to the Company’s technology and integrated product offering, the estimated cost reductions achieved through the value engineering process, and the resulting revisions to the Company’s forecasted future unit deployments and related cash flows based upon the perceived marketability and commercial viability of the Company’s technology. As a result, management updated its probability-weighted undiscounted cash flow analysis and determined that the carrying value of the Developed Technology Asset Group was not recoverable.

The fair value of the Developed Technology Asset Group was determined using the income and market approaches. The income approach used a probability-weighted discounted cash flow method based upon management’s projections of future revenues and operating expenses from future deployments of the Company’s technology discounted based an estimate of the Company’s cost of equity, which uses Level 3 inputs. As the Company has not generated revenue from its first-of-a-kind technology, the market approach was determined through an implied value approach by applying a control premium to the Company’s market capitalization, less working capital, investments in securities, and other assets not part of the asset group to estimate the fair value of the Developed Technology Asset Group, which uses Level 3 inputs. The application of these valuation methodologies resulted in an indicated fair value of the Developed Technology Asset Group of $200.0 million, resulting in the recognition of an impairment loss of $1,095.8 million for the three months ended September 30, 2025. The impairment was allocated to the long-lived assets within the asset group on a pro-rata basis, according to their relative carrying amounts. The impairment loss is included in Impairment and other charges on the condensed consolidated statements of operations and comprehensive loss.

The following table details the recognition of long-lived asset impairment as of the measurement date:



$ in thousands	Carrying Amount		Impairment		New Carrying Amount
Intangible assets, net	$	1,197,106	$	(1,012,344)	$	184,762
Property, plant, and equipment, net	94,838		(80,201)		14,637
Operating lease right-of-use assets	3,895		(3,294)		601
Total	$	1,295,839	$	(1,095,839)	$	200,000

The Company considered whether the estimated useful lives of the individual long-lived assets in the Developed Technology Asset Group required revision and concluded no changes were necessary.

Goodwill impairment

In March 2025, the Company assessed its goodwill for impairment. Due to a change in the Company’s business plan, as discussed above, and related sustained decrease in the Company’s market capitalization, the Company concluded that it was more likely than not that the fair value of its goodwill was less than its carrying amount as of March 31, 2025. As a result, the Company fully impaired its goodwill and recognized an impairment of $359.8 million during the first quarter of 2025, which is included in Impairment and other charges on the condensed consolidated statements of operations and comprehensive loss.

Other charges

During the first quarter of 2025, as a result of the management’s assessment of the probability of the construction of Project Permian due to the factors discussed above, $56.1 million of costs previously included in Construction-in-progress were expensed. This amount is included in Impairment and other charges in the condensed consolidated statements of operations and comprehensive loss.