Tecogen Reports 10% Revenue Decline to $22.6 Million for Fiscal Year 2024

Tecogen Inc. reported a decrease in revenue for the fiscal year ending December 31, 2024, with total revenues of $22.6 million, down 10% from $25.1 million in 2023. The decline was primarily attributed to a significant drop in product sales, particularly in the chiller segment, which saw a 49.8% decrease to $4.4 million. This downturn was influenced by supply chain disruptions, project deferrals, and reduced manufacturing capacity due to the company's relocation to a new facility in North Billerica, Massachusetts. Despite the challenges in product sales, the services segment experienced growth, with revenues increasing by 10.7% to $16.1 million, bolstered by the acquisition of maintenance contracts from Aegis Energy Services.

The company's gross margin improved to 43.6% in 2024 from 40.6% in the previous year, reflecting a decrease in the cost of sales, which fell by 14.7% to $12.7 million. Operating expenses, however, increased slightly to $14.4 million, leading to a loss from operations of $4.5 million, compared to a loss of $4.4 million in 2023. The net loss attributable to Tecogen was $4.8 million, up from $4.6 million the previous year, largely due to a goodwill impairment charge of $217,295 related to the energy production segment.

Strategically, Tecogen has made significant moves to enhance its market position, including a two-year sales and marketing agreement with Vertiv Corporation to promote its DTx chillers for data center cooling applications. Additionally, the company has expanded its service capabilities through the acquisition of Aegis Energy Services, which added approximately 200 maintenance agreements and eight employees to its workforce. As of December 31, 2024, Tecogen employed 91 full-time and one part-time employee, reflecting a stable workforce despite the operational challenges faced during the year.

Looking ahead, Tecogen's management remains optimistic about future growth opportunities, particularly in the data center market, which is experiencing power constraints. The company plans to leverage its hybrid-drive air-cooled chiller technology to meet the increasing demand for efficient cooling solutions. Furthermore, Tecogen anticipates that its cash flows from operations will be sufficient to fund its working capital needs over the next twelve months, although it may seek additional financing to support growth initiatives and product development.

Overall, while Tecogen faced challenges in 2024, including a decline in product revenues and operational disruptions, it has taken strategic steps to position itself for future growth and maintain a focus on its core competencies in clean energy solutions.