What's up, Stock Nation? We're back here at the Gateway Conference. I'm sitting down with Thomas Healy, CEO of Hyliion, a very cool power generation tech company. Welcome to our show. It's great to have you here today.
Thanks for having us. Looking forward to sharing a little more with your audience about how we're disrupting how electricity is made.
Very cool stuff. And I'm sure you've had a lot of meetings at this conference so far. We're on day two. How are things going so far for you?
It's been great. We've met with brand new investors, investors that are already in our stock as well as analysts who are looking at, you know, what is that new technology, that new company that they should be following.
Okay, let's start at the beginning because you founded this company originally in college. Tell us a little bit about that process of being at that phase of your life as a student and then becoming an entrepreneur. What did you build and what did it become today?
Yeah. So I was a student at Carnegie Mellon University in Pittsburgh and had this idea actually originally to go electrify the commercial vehicle space and, you know, true startup story, went through multiple rounds of funding, hired people that were friends in college to help with this. And fast forward, we took this public on the New York Stock Exchange in 2020, and I mean that's like every founder's and entrepreneur's dream to go do this. And then we saw a massive shift happening. So we started as, you know, big semis that consume a lot of diesel fuel. Our vision was make them electric. When we were going through that process, GE Aerospace actually approached us and said, 'Hey, we got a great way to charge those batteries on those vehicles called this Carnot technology, and would we want to work together?' Well, fast forward, we ended up acquiring that whole division out of GE into Hyliion. And then more recently, we actually made the decision of let's go all-in into this power generation space and make that the focus of the company. Because we're seeing great traction. We've got commercial applications, we've got military applications. The reality is everything needs more power. And if you just look at the AI industry alone, like the amount and magnitude of electricity this is going to use in data centers, I don't think people can wrap their heads around it.
Yeah. The power need is something we talk about all the time on the show. And I want to get into so people can wrap their head around specific applications, because some of us think generator, they think, okay, my power goes out of my house, I got that thing in the backyard. This is way different. What kinds of things or businesses are these products powering?
What we're doing is we're enabling a way where a company, a location, can now make electricity for cheaper, cleaner, and more reliable than most of the grid electricity out there. So to your point, most people hear generator and they're like, 'Oh, when the storm happens and I lose power, I'll be the one house in the neighborhood that still has electricity.' That's true. But our model is actually, well, if you have our generator, you're actually going to run it all the time. And as opposed to buying electricity from the grid, you make it yourself. And think about it. If you can make your own electricity for cheaper, why would you not do that, right? And the reason this hasn't been done before is there's never been a good technology to really enable good electricity generation on a small scale. And that's what we've really unlocked.
So this is fascinating. I'm sure there's a lot of science behind it. When you say make electricity, what elements is it ingesting, like how is it doing that at a high level?
Sure. So I'll give you a little background. If you go back 200 years ago, there were steam engines, there was this thing called a Stirling, right? And Stirlings were always thought of as like this is the best way to make electricity. It was really tough to manufacture. Really simply what it does is it uses heat and actually converts heat into electricity. So what we've done is we said, fast forward 200 years later, we've seen a breakthrough in manufacturing. You can now 3D print really, really complex parts that now enable us to take this 200-year-old tech and actually pull it forward and modernize it. And this thing that everyone always thought, wow, this would be an amazing way, use heat to make electricity, we are now able to do that. And so how do we get heat? Well, we really don't care where the heat comes from. It can come from reacting natural gas, propane, hydrogen, diesel, ammonia, or even things like nuclear. All nuclear does is make heat. You can actually take that heat and use that to make electricity as well.
Okay. So you mentioned nuclear, which is something I think a lot of investors are tracking. Where do you guys fit within sort of that increased nuclear demand appetite for that? Is there a growth angle there for you guys at all? Where do you fit?
Yeah, totally a growth angle there. So to get to market and just for viewers that maybe aren't familiar with us, we've just started the deliveries out to customers, getting this product out there. All the initial deployments are mainly natural gas. We've got some other fuels in that mix, but our system really doesn't care what fuel you're giving it. The one box can run on these various fuels. Now with nuclear, that is a little bit different of an architecture. So the way we're seeing it is nuclear is still years away, right? I mean there's no one that is going to be delivering this. And so what we're working on doing is looking at, okay, well who are the people that are making those nuclear reactors. And then as opposed to using a steam turbine to convert nuclear into electricity, we're saying, hey, actually Carnot is a better solution, a more efficient solution to make electricity. So nuclear needs a solution like ours. It's just a question of do they use a steam turbine or do they use something like our Carnot.
Interesting. Okay. Okay. And then you talk about the commercialization process, the first deployments being made. Who are some of the early users, either the types of companies or the companies themselves that immediately saw product market fit for their needs?
The first is the Navy. So we've been working very closely with the Navy for years. We've actually been selected as a power plant option for their future autonomous Navy vessels. So, think of like a 100-plus-foot-long ship that is just powered off of this heat-powered generator. And the reason the Navy selected us was because we've got so low maintenance in our system. If there's no one on board to do an oil change in an engine, well, now you need a solution that is low maintenance. Similarly, think of like a location where you don't know what fuel is going to be available. Well, you could give it diesel, you could give it gasoline, you could give it natural gas, and this one generator can take those various fuels. So, Navy and military applications we think is going to be huge for us. We are also just doing kind of the standard commercial deployments. So, think of like for example, a Home Depot, one of our boxes sitting outside could power that whole facility. A Walmart which has refrigeration systems inside, you would need two of our boxes that could power it. Then there's data centers. So this is where we're seeing the most demand coming from. We recently announced an LOI with one of the large data center providers for 70 megawatts of power over the years ahead. And so data centers are at this stage today where they're going to make power on site. Like if you go to Virginia, you go to Ireland, the utilities, the grid is saying we don't have power to give you anymore. You have to bring your own electricity with you. And so that's what means they need a solution like ours or something that makes power on site.
And you mentioned international. Is the focus US first and then global or is it all sort of happening at the same time?
Definitely US first and then quickly looking at international. We also had a fun announcement where President Trump went over to the Middle East. He met with the leaders and they announced 600 billion of projects and opportunities. We were actually 1 billion of that 600 billion. And so we've got a great partner over in the Middle East that is already a provider of generators in that territory and so we're working with them on how can we bring this international as well.
Very cool. So for investors at home kind of eyeing the journey, you mentioned okay we're deploying these and commercialization picking up. How should they think about focus on revenue growth, profitability? What is the state of the business right now and how should people think about where you're at today versus where you're going to be say a year from now?
