Birchtech Turns the Page: IPR Wars End, Water Growth Begins
Patent challenges finally cleared, the activated-carbon specialist bets its future on a self-funding pivot from clean air to clean water.
MEEC · Earnings Call · 2026-08-13
The IPR Battle Ends, the Sales Campaign Begins
After seven years of litigation—and roughly $37 million in license fees and settlements—Birchtech (ticker: MEEC) enters the second half of 2026 with its core patent estate finally unchallenged. As CEO Richard MacPherson stated on the call, “Every petition filed with the Patent Trial and Appeal Board against our patented SEA technologies have now been dismissed, removed prior to institution or resolved, and the parties previously involved are permanently barred from bringing further patent validity challenges.” — Richard MacPherson, Chief Executive Officer · 2026-08-13 That milestone removes a long-running overhang and clears the way for the company to convert unlicensed coal utilities into recurring supply customers. The air division is already showing the benefit. Second-quarter revenue reached $3.8 million, up from $3.3 million a year earlier, with air revenue of $3.4 million driven by “the mix of plants that we have running combined in more extreme weather conditions and the higher natural gas prices.” The legal clarity is now translating into commercial momentum, as MacPherson noted in the Q&A: “I do expect that we'll see an increase starting in the second half of this year. I do expect that we'll see a significant increase in the actual product supply revenue on the air side for 2026 over 2025.” — Richard MacPherson, Chief Executive Officer · 2026-08-13 This is a marked shift from prior quarters, when guidance was more guarded. In March, he was already signaling a $20 million air revenue target for 2026 (a figure that now looks conservative given the ramp), and the recurring supply contracts are beginning to layer in. The company’s goal of converting licensees into direct activated carbon purchasers is moving from aspiration to execution.Water: From Testing to a Commercial Pipeline
The more transformative story is the water division. Birchtech has been building a data-first approach using RSSCT testing through its design centers, and the strategy is gaining traction. MacPherson highlighted that “Our design centers will become significant profit centers, establishing our credibility and creating a strong market position for our products, services and highly effective technologies.” — Richard MacPherson, Chief Executive Officer · 2026-08-13 The recent launch of a nuclear-grade ion exchange resin line, ion exchange rosins, targets a $200-million-plus addressable market in coal, nuclear, and municipal water treatment. The company has also expanded into boron and heavy-metal removal. Most importantly, carbon rejuvenation—the flagship innovation—is approaching a commercial decision. The technology, which allows thermally rejuvenated granular activated carbon to perform on par with virgin carbon for PFAS removal, could dramatically reduce life-cycle costs for utilities. Management expects to announce an offtake agreement and first facility plans “by the end of September,” according to the CEO. That timeline is critical because federal and state PFAS regulations are tightening, and utilities are accelerating their remediation spending. This pivot is deeply rooted in the global context. The U.S. coal fleet is being kept alive by stable federal support and surging power demand from AI data centers, giving the air business a longer runway to fund the water expansion. Conversely, the water business benefits from an EPA-driven compliance cycle that is forcing utilities to adopt water filtration solutions. Birchtech is positioning itself as a low-cost, technically rigorous alternative to the established players.Financial Foundation and What's Next
Financially, the company is in a stronger position than a year ago. CFO Michael Mioska reported: “Cash as of June 30, 2026, totaled $11.8 million with no debt as compared to $2.2 million as of December 31, 2025.” — Michael Mioska, Chief Financial Officer · 2026-08-13 That cash cushion—plus the $78 million final judgment still on appeal, which could add a windfall—provides the capital to scale the water division without dilutive equity raises. The $7.3 million profit-share liability is contingent on collecting that judgment, so it is not a near-term concern. Net loss widened to $3.0 million year-over-year as SG&A and R&D expenses rose, but that is the cost of building the water platform. Management is clearly executing a deliberate strategy: use the mature air business as a self-funding growth engine while laying the groundwork for a much larger water business. As MacPherson put it in his closing remarks,With the IPR cloud lifted, the air side converting to recurring revenue, the water pipeline advancing, and a possible judgment on the horizon, Birchtech is a name in motion. The key catalysts—offtake agreements, rejuvenation facility announcements, and the appeal outcome—are all expected within the next 12 months. The story is no longer about surviving legal battles; it is about scaling a cleaner-air-and-water business with a first-mover edge in carbon rejuvenation. Prior quarters were more tentative, with MacPherson in 2024 promising to “see revenue in 2025” from the water business and announcing the PFAS opportunity. Now, in 2026, those promises are turning into hard numbers and timelines. The company is executing, and the market will be watching for the September updates.We look forward to sharing future updates as we work to create value for my fellow shareholders and advance our vision of leading the specialty activated carbon space, delivering clean air and water more affordably, especially to those utilities in smaller communities.