374Water Inc (NASDAQ:SCWO, FRA:8LL) has reported its first quarter financial results which included higher gross margins, expanding waste destruction operations, and progress on several municipal and federal projects tied to PFAS waste treatment.
The cleantech company, which develops supercritical water oxidation technology through its AirSCWO platform, posted revenue of around $551,000 for the quarter ended March 31, compared with $543,000 a year earlier.
Gross margin rose to 63% from 25% in the prior-year period, while gross profit increased to just over $348,000 from $138,000.
Net loss widened to $4.57 million from $3.7 million a year earlier, which the company attributed in part to continued investment in commercial infrastructure, financing-related expenses, and franchise tax costs.
Cash used in operating activities improved 28% year over year to $2.51 million.
374Water said it has continued expanding its Waste Destruction Services platform across municipal, industrial, and federal markets.
During the quarter, the company signed a five-year agreement with the City of Orlando to build out its waste destruction facility, with options for two additional five-year extensions.
The company also received a $2.2 million milestone payment tied to a contract with Garney Construction and the City of Olathe, Kansas. The overall contract is valued at more than $4.5 million.
Operationally, 374Water deployed its mobile AirSCWO system to St. Cloud, Minnesota for a six-month campaign focused on destroying PFAS-contaminated biosolids and other waste streams. The company also reported third-party testing results from US Department of Defense programs showing PFAS destruction rates frequently exceeding 99.9%.
374Water chief operating officer Brad Meyers said the company is seeing demand from multiple market segments while scaling infrastructure and improving margins.
"We are delivering dramatically improved gross margins, our mobile AirSCWO system has arrived in Minnesota for its inaugural campaign with the City of St. Cloud, and we continue executing in lockstep with Orange County Sanitation District and the City of Orlando,” Meyers said.
"We are scaling our Waste Destruction Services facility with additional tankage and infrastructure, and expect to showcase the operations later this year."
The company said its Orlando waste destruction facility is expected to initially generate between $100,000 and $200,000 in monthly revenue, with potential expansion opportunities under discussion with strategic partners.
"We have several interested partners who want to help bring AirSCWO to market, create strong commercial pathways, and provide supporting operations for our projects and technology,” said Howard Teicher, VP of Government for 374Water.
"We are heavily engaged in structuring a partnership to unlock tremendous value and accelerate our scale-up."
Danny Bogar, 374Water president, added: "Industrial and infrastructure operators are coming to the table because they see what we already know: AirSCWO is not a future technology. It is operating today, destroying waste under contract, and ready to scale."