On September 14, American Battery Technology Company (NASDAQ:ABAT) held its fiscal year 2026 earnings call, and for once the numbers matched the ambition. Revenue at its flagship recycling facility jumped more than 400% to $21.7 million, and the company posted its first-ever adjusted gross profit. But on the same call, CEO Ryan Melsert disclosed a federal directive that could choke off exports of one of the plant’s key products, black mass, a reminder that ABAT’s fortunes are still tied tightly to Washington.
A Business Finally Turning Profitable
Revenue jumped over 400% year over year to $21.7 million, fueled by higher throughput at the company’s first recycling facility and increased sales of byproducts. Cost of goods sold rose only 67% over the same stretch, evidence that fixed costs are spreading across a much bigger volume of material. Even more telling, operating cash spend actually fell 16% even as throughput at the plant more than quadrupled. That combination pushed American Battery Technology to an adjusted gross profit of $1.7 million, a sharp turnaround from the $6.2 million loss it posted a year earlier.
The balance sheet tells a similar story. Cash climbed to $49.5 million as of June 30, 2026, and total assets reached $133 million, up sharply from the prior year. The company also erased all of its long-term debt during the year, leaving it with a clean balance sheet heading into a period of heavy capital spending.
Growth plans are already in motion. A second recycling facility planned for the Southeast U.S., designed to process 100,000 tons of batteries a year, is backed by a $150 million grant from the Department of Energy, and a separate $10 million DOE grant is funding three next-generation recycling technologies. On the mining side, the Bureau of Land Management certified the company’s plan of operations for its Tonopah lithium project in Nevada, home to an identified 21.3 million tons of lithium hydroxide, including 2.7 million tons of proven and probable reserves. The project also won a FAST-41 priority designation, intended to speed up federal permitting.
A Federal Directive Clouds Exports
The clearest risk surfaced on the call itself. The US Department of Commerce issued a directive that effectively bans the export of black mass, the concentrated metal byproduct of battery recycling, unless a company obtains a specific exception. American Battery Technology has submitted a request for that exception, but as of the call, Commerce had not issued a formal response, and the company is storing black mass at its facility in the meantime.
That is not the company’s first brush with federal uncertainty this year. A separate DOE grant supporting the Tonopah claystone project was canceled last fall before being fully reinstated after months of appeals. The reversal preserved the original funding and milestones, but it underscores how much of American Battery Technology’s growth, from the second recycling plant to the lithium refinery, depends on grants, permits, and decisions made in Washington rather than the open market.
The Tonopah project itself is also still years from producing revenue. The company has only cleared the pre-NEPA phase of its environmental review and is now entering the full NEPA process, the stage that actually determines whether construction can begin. And while the $1.7 million adjusted gross profit marks a real turnaround, it is a non-GAAP figure that excludes certain non-cash costs, a reminder that the recycling business is still in the early stages of turning consistent, unadjusted profit.
Wall Street Is Still Skeptical
Hedge fund ownership rose to 14 funds holding a position in the most recent quarter, up from 10 the quarter before, a modest sign of accumulating interest. Short interest sits at 16.38% of the float, a level that points to heavy skepticism even as the fundamentals improve. The stock trades at a forward P/E of 37.74, as of September 16, pricing in continued growth from a company that only just turned adjusted profitable. That combination, rising fund ownership against a crowded short base, suggests the market is still arguing with itself over which story to believe.
What Happens Next
American Battery Technology enters its new fiscal year with a cleaner balance sheet, a profitable recycling plant, and a lithium project moving through the final stage of federal review. Yet black mass exports remain frozen pending a decision the company does not control, and its two biggest growth bets still depend on government grants and permits rather than proven, repeatable execution. A resolved export exception paired with continued throughput gains would go a long way toward confirming this turnaround is durable. Another funding reversal, or a prolonged export freeze, would be a reminder of how much of the story still rests outside the company’s hands.
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