Aemetis Inc. (NASDAQ: AMTX) reported second-quarter 2026 results that signal a potential operating inflection point, even as revenue missed consensus estimates. The company generated positive operating income and adjusted EBITDA for the quarter, a marked improvement from the prior year, driven by stronger renewable natural gas (RNG) production, improved ethanol economics, and the recognition of quarterly 45Z tax credits.
Revenue increased 20% year-over-year and 15% sequentially to $62.7 million, falling short of the $68.6 million consensus estimate. However, the revenue shortfall was largely attributed to timing of India OMC tenders, while the underlying performance in the company's California-based businesses exceeded expectations. Gross profit swung to $13.5 million from a $3.4 million loss in the prior year, and adjusted EBITDA reached $9.7 million, compared to a negative $5.8 million in the same period last year. Stonegate Capital Partners, which updated coverage on the company, noted that normalized EPS of negative $0.11 beat consensus estimates of negative $0.24.
The dairy RNG segment remains the clearest growth driver, with sales volume increasing 38% year-over-year to 146,900 MMBtu, and segment gross profit rising to $4.0 million from $0.9 million. The company has seven approved LCFS pathways with an average carbon intensity of negative 380, which are already improving credit economics. Additionally, six more pathways are nearing approval, and two digesters are expected to be commissioned in the third quarter of 2026, providing further room for production growth and profitability.
The Keyes ethanol plant is also advancing its earnings improvement plan, with mechanical vapor recompression (MVR) targeted for operation by year-end 2026. Management estimates that once operational, the MVR could deliver approximately $32 million in annual value through lower natural gas usage and incremental LCFS and 45Z benefits. These operational improvements could significantly strengthen the company's earnings profile beginning in 2027.
Despite the positive operational momentum, the balance sheet remains the primary constraint on the investment thesis. The company ended the quarter with just $1.0 million in unrestricted cash and $415.9 million in total debt. Refinancing progress is critical to translating the operational improvements into durable free cash flow. Investors will be watching closely for updates on the company's debt refinancing efforts, as well as continued execution in the RNG and Keyes projects.
