New Fortress Energy 2025 Q1 Earnings Misses Targets with Net Income Falling 448%

New Fortress Energy (NFE) reported its fiscal 2025 Q1 earnings on May 14, 2025. The company missed expectations, swinging to a net loss of $197.37 million compared to a net income of $56.67 million in the same quarter last year. The earnings per share also fell from a profit of $0.26 to a loss of $0.73. Despite this, NFE maintains a positive outlook, expecting core earnings growth as new projects come online. The company also announced the completion of its $1.055 billion Jamaican asset sale, emphasizing debt reduction and operational streamlining.

Revenue
New Fortress Energy's revenue for the first quarter of 2025 saw a significant decrease of 34.4% year-over-year, dropping to $430.32 million from $656.16 million in Q1 2024. The operating revenue stood at $384.88 million, while the vessel charter revenue amounted to $45.44 million. Other revenue sources contributed $40.22 million, leading to a total revenue of $470.54 million for the quarter.

Earnings/Net Income
New Fortress Energy reported a substantial shift from a profit to a loss, with earnings per share declining to a loss of $0.73 from a profit of $0.26. The net loss of $197.37 million marks a 448.3% deterioration compared to the previous year. These figures indicate a challenging quarter for the company.

Post-Earnings Price Action Review
The investment strategy of acquiring New Fortress Energy shares after a quarterly revenue drop and holding them for 30 days has resulted in poor performance. This approach yielded a return of -46.92%, significantly underperforming the benchmark return of 87.14%. The strategy's excess return was calculated at -134.06%, and a compounded annual growth rate (CAGR) of -11.98% was recorded, highlighting substantial losses over the past five years. Additionally, this strategy experienced a high maximum drawdown of -90.63%, and a Sharpe ratio of -0.17, which reflects significant risk and negative returns. These metrics suggest that the strategy has not yielded favorable outcomes and poses considerable financial risks for investors.

CEO Commentary
Wes Edens, Chairman and CEO of New Fortress Energy, highlighted the completion of the Jamaican assets sale to Excelerate Energy as a pivotal moment for the company. He emphasized the focus on streamlining operations and reducing corporate debt. Edens also noted NFE's positive impact on Jamaica's energy transition and expressed confidence in Excelerate's ability to maintain energy reliability and affordability.

Guidance
The company projects an increase in core earnings as developments in Brazil, Nicaragua, and Puerto Rico come online. NFE anticipates generating earnings from the nearly completed 624 MW CELBA power plant in the third quarter of this year, with ongoing projects fully funded through asset-level debt. Additionally, the company is committed to using proceeds from the Jamaican asset sale to reduce debt and simplify its balance sheet through potential asset-based financing.

Additional News
New Fortress Energy recently closed the sale of its Jamaican assets to Excelerate Energy for $1.055 billion, a move aimed at reducing corporate debt and streamlining operations. The transaction included the LNG import terminal in Montego Bay and other key energy infrastructure. This strategic move aligns with NFE's plan to optimize its asset portfolio and strengthen financial stability. Additionally, the company has been exploring further strategic partnerships and asset sales to enhance operational efficiency. With the proceeds from the Jamaican sale, NFE plans to pay down $270 million of its Revolving Credit Facility and $55 million of its Term Loan A facility, with the remainder bolstering its cash reserves.