SES AI Corporation announced a strategic partnership with Korea‑based Top Material to expand battery cell production at its Chungju, South Korea facility. The collaboration will triple the plant’s output to nearly one million cells, a move designed to meet the accelerating demand for lithium‑metal and lithium‑ion batteries in the drone and urban air mobility (UAM) markets while ensuring compliance with U.S. National Defense Authorization Act (NDAA) country‑of‑origin and supply‑chain requirements.
The partnership comes on the back of a strong Q3 2025 earnings report in which SES AI beat revenue expectations by $2.54 million, reporting $7.12 million versus analyst estimates of $4.58 million. The company posted a GAAP net loss of $20.9 million, or –$0.06 per share, slightly missing the consensus estimate of –$0.05. Management raised its full‑year 2025 revenue guidance to $20 million–$25 million, reflecting confidence in the growth trajectory of its UZ Energy business and the expanding UAM segment.
Founder and CEO Qichao Hu said the Chungju facility, which has been operational since 2021, has become a trusted partner for scaling production. “We have worked closely with Top Material over the past several years to build a supply chain that meets NDAA requirements,” Hu noted. CFO Jing Nealis added that the UZ Energy unit is expected to grow from $10 million–$15 million in 2025 revenue to a much larger figure in the coming years, underscoring the company’s focus on high‑margin service revenue.
The announcement triggered a 13.7% jump in the company’s stock price in early trading, reflecting investor enthusiasm for the expanded production capacity and the potential to secure defense contracts. Analysts highlighted the partnership as a key driver of the market reaction, noting that the ability to meet NDAA compliance opens a new high‑value revenue stream.
Strategically, the expansion aligns with SES AI’s shift from electric‑vehicle battery cells to lithium‑metal batteries for air‑mobility applications. The company’s AI‑driven Molecular Universe platform is expected to accelerate material discovery and reduce R&D costs, while the UZ Energy acquisition diversifies revenue streams. Together, these moves position SES AI to capture a larger share of the rapidly growing drone and UAM markets and to capitalize on defense‑grade opportunities that require compliant supply chains.
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