Executive Summary / Key Takeaways

• NewHydrogen is a development-stage company focused on its ThermoLoop™ technology, a novel thermochemical process aiming to produce green hydrogen using heat and water, bypassing expensive electricity-based electrolysis.
• The core investment thesis centers on ThermoLoop's potential to fundamentally lower the cost of green hydrogen, addressing a major hurdle in the estimated $12 trillion hydrogen market and positioning NEWH as a potential disruptor to traditional electrolyzer technologies.
• Recent progress includes filing a joint patent application for the ThermoLoop process, securing an exclusivity option on the patent with UC Santa Barbara, and strengthening the technical team with key engineering appointments.
• Financially, NEWH remains pre-revenue, reporting a net loss of $476,094 and using $492,812 in cash from operations in Q1 2025, with a cash balance of $1.61 million as of March 31, 2025.
• The company faces significant liquidity risk, with current cash projected to last approximately nine months, necessitating additional financing to fund ongoing R&D and future prototyping efforts planned for early 2026.

The Quest for Cheaper Green Hydrogen

The global energy transition hinges significantly on the widespread adoption of green hydrogen, a clean fuel produced from renewable sources. Goldman Sachs estimated the future market value of this economy could reach a staggering $12 trillion. However, a major bottleneck persists: the high cost of production. The prevailing method, electrolysis, splits water using electricity, but green electricity, even from renewable sources like solar and wind, remains expensive, accounting for a substantial 73% of the cost of green hydrogen.

Enter NewHydrogen, Inc. ($NEWH), a company that has pivoted its focus from solar material technology to tackle this cost challenge head-on. Incorporated in 2006 and formerly known as BioSolar, Inc., the company strategically shifted its direction in April 2021 to concentrate on developing clean energy technologies, specifically targeting the green hydrogen market. Their core strategic response to the high cost of electrolysis is the development of ThermoLoop™, a breakthrough thermochemical technology designed to produce green hydrogen using heat and water instead of expensive electricity.

This strategic pivot positions NewHydrogen as a potential disruptor in a market currently dominated by electrolyzer manufacturers like Plug Power (PLUG), Nel ASA (NEL), and ITM Power (ITM). While these competitors focus on improving the efficiency and scalability of electrolysis, NewHydrogen is pursuing a fundamentally different approach. The company's narrative is one of challenging the status quo, as articulated by CEO Steve Hill, who has stated, "Today, using electrolyzers is the only commercially available way to split water to produce renewable hydrogen. Electrolyzers have dominated the headlines, but their reign may be coming to an end. The time has come to kill electrolyzers!" He views the industry's heavy reliance on electrolysis as a hindrance, describing the technology as "old tech—expensive, inefficient, and fundamentally flawed."

NewHydrogen's competitive strategy is rooted in cost leadership enabled by technological innovation. While competitors like NEL boast technological expertise in PEM electrolyzers offering higher hydrogen output efficiency and ITM focuses on rapid prototyping and scalability, NewHydrogen aims to achieve cost advantages through its unique process and material science. The company believes ThermoLoop's theoretical heat-based thermodynamic efficiency can outperform electrolyzers on a cost-per-kilogram basis. This focus on affordability and sustainability through the use of earth-abundant materials is NewHydrogen's primary differentiator against rivals who may have more established market share, broader product portfolios, or faster processing speeds.

The ThermoLoop Technology: A Different Approach

At the heart of NewHydrogen's strategy is the ThermoLoop technology. Unlike electrolysis, which requires significant electrical input, ThermoLoop is designed to use heat directly to split water into hydrogen and oxygen. This heat can be sourced from various inexpensive and readily available sources, including concentrated solar, geothermal energy, nuclear reactors, and industrial waste heat.

The technology employs novel materials and reactions engineered to maintain the process at nearly the same temperature, a critical feature intended to eliminate the energy losses typically associated with traditional thermochemical heating and cooling cycles. This constant-temperature approach is expected to overcome a long-standing challenge in scaling thermochemical processes without sacrificing energy efficiency. The company believes this enables continuous, 24/7 hydrogen production wherever sufficient heat and water are accessible.

NewHydrogen's innovative process involves a multi-phase oxidation-reduction cycle utilizing regenerable reactive solids to separate the oxidation and reduction reactions. This is intended to mimic the efficiency of electrochemical processes but without the high capital and operating costs associated with electrolyzers. The company claims this method can generate hydrogen at lower temperatures and with greater efficiency than conventional approaches.

Progress on this technology is being driven through a research agreement with the University of California, Santa Barbara (UCSB). A significant milestone was achieved on March 11, 2025, with the joint filing of a U.S. patent application titled “Coupled Multi-Phase Oxidation-Reduction for Production of Chemicals” for this innovative process. Further solidifying this collaboration and protecting the intellectual property, NewHydrogen entered into an agreement with UCSB on May 1, 2025, to obtain a 12-month exclusivity option on the jointly filed patent.

To accelerate the technical development and commercialization of ThermoLoop, NewHydrogen has also bolstered its leadership team. Dr. Eric McFarland, with extensive experience in energy systems and reaction engineering, was appointed Chief Technology Officer on April 29, 2025, and will continue to work closely with the UCSB research team. Sundar Narayanan was appointed Director of Process Engineering on May 20, 2025, to lead process development and scale-up efforts. These appointments signal the company's focus on moving the technology from the laboratory towards practical application.

The "so what" for investors is clear: if ThermoLoop can deliver on its promise of significantly lower cost green hydrogen production, it could carve out a substantial competitive moat in the burgeoning hydrogen market. This technological advantage is the primary driver of the investment thesis, offering the potential for higher margins and a differentiated market position compared to competitors reliant on the more mature, and potentially cost-constrained, electrolysis technology.

Financial Reality and the Path Forward

Despite the promising technological developments, NewHydrogen remains a development-stage company without revenue. The financial statements for the three months ended March 31, 2025, reflect this stage. The company reported a net loss of $476,094, a slight increase from the $471,004 loss in the same period of 2024. Operating expenses totaled $476,271 in Q1 2025, up from $471,341 in Q1 2024. This increase was primarily driven by higher selling and marketing expenses ($106,479 vs $74,971) due to increased service providers and an increase in research and development expenses ($101,518 vs $88,939) attributed to higher outside research fees, reflecting the ongoing work on ThermoLoop. General and administrative expenses saw a slight decrease ($267,453 vs $306,404).

As of March 31, 2025, NewHydrogen held $1.61 million in cash, down from $2.10 million at December 31, 2024. The company used $492,812 in cash for operating activities during the first three months of 2025, an increase from $431,405 in the prior-year period, mainly due to the rise in R&D and marketing costs. This cash burn resulted in working capital of $1.64 million and an accumulated deficit of $178.42 million as of March 31, 2025.

Liquidity is a critical factor for NewHydrogen. Management believes the current cash balance is sufficient to cover operating expenses for approximately nine months from the filing date of the 10-Q (May 9, 2025). However, they explicitly state that additional cash resources will be required during 2025 to fund operations according to the current plan. The company's capital needs have historically been met through the sale of securities, and management intends to continue seeking additional financing. The independent auditors have expressed substantial doubt about the company's ability to continue as a going concern without securing additional capital.

The path forward involves continued technology development and eventual commercialization. The company does not anticipate a significant increase in expenses until early 2026, when it plans to ramp up prototyping efforts for the thermochemical water splitting technology. This timeline underscores the need for sustained funding over the next year and beyond. To address the immediate need for potential capital, NewHydrogen entered into an Equity Financing Agreement with GHS Investments, LLC on May 2, 2025, allowing the company to sell up to 3 million shares of its common stock to GHS. This provides a potential avenue for funding, though the terms and timing of any sales under this agreement are subject to market conditions and the company's discretion.

Risks and Challenges

Investing in NewHydrogen involves significant risks, primarily stemming from its development stage and reliance on external funding. The most prominent risk is the company's ability to continue as a going concern, which is dependent on its capacity to raise additional capital, generate revenue (which is not expected in the near term), and achieve profitable operations. There is no assurance that future financing will be available on terms favorable to the company or its existing stockholders, and equity financing would likely result in substantial dilution.

Technological risk is also inherent. While the ThermoLoop technology shows promise and has reached the patent application stage, it is still under development. There is no guarantee that the technology will be successfully scaled up, prove commercially viable, or achieve the targeted cost reductions and efficiencies in practice. The competitive landscape is dynamic, with established players and other emerging technologies vying for market share in the green hydrogen space. NewHydrogen's ability to compete will depend heavily on the successful development and cost-effectiveness of ThermoLoop relative to alternative methods.

Furthermore, the company's small scale and limited resources compared to larger competitors could pose challenges in areas such as supply chain establishment, manufacturing scale-up, and market penetration. The vesting of certain performance-based stock options is tied to significant milestones like filing an S-3 registration statement or listing on a national securities exchange, which management currently assesses as having a low probability within the next 12 months based on the company's current market capitalization and trading volume. This assessment highlights the significant steps and potential challenges ahead for the company to reach more mature public market stages.

Conclusion

NewHydrogen represents a high-potential, high-risk investment opportunity centered on its innovative ThermoLoop technology. The company is pursuing a differentiated strategy to disrupt the green hydrogen market by aiming to produce the fuel at a significantly lower cost than traditional electrolysis methods, leveraging heat instead of expensive electricity. Recent progress in patenting the technology and building the technical team demonstrates tangible steps forward in the development process.

However, the company's pre-revenue status, ongoing cash burn, limited cash runway, and reliance on future financing present substantial challenges and risks, including the fundamental uncertainty around its ability to continue as a going concern. The investment thesis is a bet on the successful development, scaling, and commercialization of ThermoLoop, and its ability to gain traction in a competitive market against more established players. For investors with a high-risk tolerance and a long-term view, NewHydrogen offers exposure to a potentially transformative technology in a massive addressable market, but the path to commercial success and financial stability remains long and uncertain, heavily dependent on securing necessary funding and executing on its ambitious technological roadmap.