Restatement and Revision of Previously Issued Consolidated Financial Statements

We have restated herein our consolidated financial statements as of and for the year ended December 31, 2018 and revised herein our consolidated financial statements as of and for the year ended December 31, 2017. We have also restated and revised related amounts within the accompanying footnotes to the consolidated financial statements to conform to the corrected amounts in the financial statements.

Restatement Background

On February 11, 2020, our management, in consultation with the Audit Committee of our Board of Directors, determined that Bloom's previously issued consolidated financial statements as of and for the year ended December 31, 2018, as well as financial statements for the three month period ended March 31, 2019, the three and six month periods ended June 30, 2019 and 2018 and the three and nine month periods ended September 30, 2019 and 2018 should no longer be relied upon due to misstatements related to our Managed Services Agreements and similar arrangements and we would restate such financial statements to make the necessary accounting corrections. The revenue for the Managed Services Agreements and similar transactions will now be recognized over the duration of the contract instead of upfront. In addition, management determined that the impact of these misstatements to periods prior to the three months ended June 30, 2018 was not material to warrant restatement of reported figures, however, our consolidated financial statements as of and for the year ended December 31, 2017 and the relevant unaudited selected quarterly financial data for the three month period ended March 31, 2018 would be revised to correct these misstatements. The restatement also includes corrections for additional identified immaterial misstatements in certain of the impacted periods.

The misstatements are described in greater detail below.

Description of Misstatements

Under our Managed Services program, we sell our equipment to a bank financing party under a sale-leaseback transaction, which pays us for the Energy Server and takes title to the Energy Server. We then enter into a service contract with an end customer, who pays the bank a fixed, monthly fee for its use of the Energy Server and pays us for our maintenance and operation of the Energy Server.

The majority of these Managed Services Agreements and similar transactions were originally recorded as sales, subject to an operating lease, in which revenues and associated costs were recognized at the time of installation and acceptance of the Bloom Energy Server at the customer site.

In December 2019, in the course of reviewing a Managed Services transaction that closed on November 27, 2019, an issue was identified related to the accounting for our Managed Services transactions. The issue primarily related to whether the terms of our Managed Services Agreements and similar arrangements, including the events of default provisions, satisfied the requirements for sales under the revenue accounting standards. Subsequently, it was determined that the previous accounting for the Managed Services Agreements and similar transactions was misstated, as the Managed Services Agreements and similar transactions should have been accounted for as financing transactions under lease accounting standards.

The impact of the correction of the misstatement is to recognize amounts received from the bank financing party as a financing obligations, and the Energy Server is recorded within property, plant and equipment, net on our consolidated balance sheets. We recognize revenue for the electricity generated by the systems, based on payments received by the bank from the customer, and the corresponding financing obligations to the bank is also amortized as these payments are received by the bank from the customer, with interest thereon being calculated on an effective interest rate basis. Depreciation expense is also recognized over the estimated useful life of the Energy Server.

In addition, it was determined that stock-based compensation costs relating to manufacturing employees that were previously expensed as incurred incorrectly, should have been capitalized as a component of Energy Server manufacturing costs to inventory, deferred cost of revenues, construction-in-progress and property, plant and equipment in accordance with SEC Staff Accounting Bulletin Topic 14. These costs will now be expensed on consumption of the related inventory and over the economic useful life of the property, plant and equipment, as applicable.

Also, as part of a review of historical revenue agreements as a result of the above errors, it was noted that the Company failed to identify embedded derivatives in certain revenue agreements for an escalator price protection (“EPP”) feature given to our customers. As a result, the Company has recorded a derivative liability, with an offset to revenue, to account for the fair value of this feature at inception and will record the liability at its then fair value at each period end with any changes in fair value recognized in other income (expense).

Finally, there were certain other immaterial misstatements identified or which had been previously identified which are also being corrected in connection with the restatement and/or revision of previously issued financial statements.

Description of Restatement and Revision Reconciliation Tables

In the following tables, we have presented a reconciliation of our consolidated balance sheets, statement of operations and cash flows from our prior periods as previously reported to the restated and revised amounts as of and for the years ended December 31, 2018 and 2017, respectively. The Consolidated Statements of Comprehensive Loss and the Consolidated Statements of Convertible Redeemable Preferred Stock, Redeemable Noncontrolling Interest, Stockholders' Deficit and Noncontrolling Interest for the years ended December 31, 2018 and 2017 have been restated and revised, respectively, for the restatement and revision impacts to Net Loss and, for the latter statements, for the correction of an uncorrected misstatement within Additional Paid-In Capital for $0.8 million in 2018. See the statement of operations reconciliation tables below for additional information on the restatement and revision impacts to Net Loss. For the misstatements arising in periods commencing prior to 2017, the cumulative impact of all periods prior to January 1, 2017 has been reflected as an adjustment to opening accumulated deficit as of that date in the Consolidated Statements of Convertible Redeemable Preferred Stock, Redeemable Noncontrolling Interest, Stockholders’ Deficit and Noncontrolling Interest.

Bloom Energy Corporation

Consolidated Balance Sheet

(in thousands, except share and per share data)



	December 31, 2018
	As Previously Reported		Restatement Impacts			Restatement Reference	As Restated

Assets
Current assets:
Cash and cash equivalents	$	220,728	$	—			$	220,728
Restricted cash	28,657		—				28,657
Short-term investments	104,350		—				104,350
Accounts receivable	84,887		3,897			₁	88,784
Inventories	132,476		2,789			₂	135,265
Deferred cost of revenue	62,147		(18,338		)	₃	43,809
Customer financing receivable	5,594		—				5,594
Prepaid expenses and other current assets	33,742		3,005			4	36,747
Total current assets	672,581		(8,647		)		663,934
Property, plant and equipment, net	481,414		235,337			5	716,751
Customer financing receivable, non-current	67,082		—				67,082
Restricted cash, non-current	31,100		—				31,100
Deferred cost of revenue, non-current	102,699		(102,654		)	3	45
Other long-term assets	34,792		8,090			6	42,882
Total assets	$	1,389,668	$	132,126			$	1,521,794
Liabilities, Redeemable Noncontrolling Interest, Stockholders’ Deficit and Noncontrolling Interests
Current liabilities:
Accounts payable	$	66,889	$	—			$	66,889
Accrued warranty	19,236		(1,268		)	7	17,968
Accrued expenses and other current liabilities	69,535		(2,697		)	8	66,838
Financing obligations	—		8,128			9	8,128
Deferred revenue and customer deposits	94,158		(26,526		)	10	67,632
Current portion of recourse debt	8,686		—				8,686
Current portion of non-recourse debt	18,962		—				18,962
Current portion of non-recourse debt from related parties	2,200		—				2,200
Total current liabilities	279,666		(22,363		)		257,303
Derivative liabilities	10,128		4,015			11	14,143
Deferred revenue and customer deposits, net of current portion	241,794		(154,486		)	10	87,308
Financing obligations, non-current	—		385,650			9	385,650
Long-term portion of recourse debt	360,339		—				360,339
Long-term portion of non-recourse debt	289,241		—				289,241
Long-term portion of recourse debt from related parties	27,734		—				27,734
Long-term portion of non-recourse debt from related parties	34,119		—				34,119
Other long-term liabilities	55,937		(29,741		)	8	26,196
Total liabilities	1,298,958		183,075				1,482,033

Redeemable noncontrolling interest	57,261		—				57,261
Stockholders’ deficit:
Common stock	11		—				11
Additional paid-in capital	2,480,597		755			12	2,481,352
Accumulated other comprehensive income	131		—				131



	December 31, 2018
	As Previously Reported			Restatement Impacts			Restatement Reference	As Restated
Accumulated deficit	(2,572,400		)	(51,704		)		(2,624,104		)
Total stockholders’ deficit	(91,661		)	(50,949		)		(142,610		)
Noncontrolling interest	125,110			—				125,110
Total liabilities, redeemable noncontrolling interest, stockholders' deficit and noncontrolling interest	$	1,389,668		$	132,126			$	1,521,794

¹ Accounts receivable — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements, for which the amount recorded to accounts receivable represents amounts invoiced for capacity billings to end customers which have not yet been collected by the financing entity as of the period end.

² Inventories — The correction of these misstatements resulted from the change of accounting for inventory, including net capitalization of stock-based compensation cost of $8.1 million, reclassification of inventories of $6.0 million held for shipments to customers under the Managed Services Program and similar arrangements to construction in progress within property, plant and equipment, net and an increase to inventory to correct a misstatement related to an in-transit shipment of $0.7 million.

³ Deferred cost of revenue, current and non-current — The correction of these misstatements resulted from reclassifying deferred cost of revenue to property, plant and equipment, net for the leased Energy Servers under the Managed Services Agreements and similar sale-leaseback arrangements of $19.6 million current and $102.7 million non-current, net capitalization of stock-based compensation costs of $2.2 million into current deferred cost of revenue together with the correction of an immaterial misstatements identified to reduce deferred cost of revenue of $0.9 million.

⁴ Prepaid expenses and other current assets — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements and similar arrangements where prepaid property tax and insurance payments are now classified within prepaid expenses, rather than offset against deferred revenue.

⁵ Property, plant and equipment, net — The correction of these misstatements resulted from the change of accounting for Managed Services transactions and similar arrangements, whereby product and install cost of revenues are now recorded as property, plant and equipment, net in the cases where the risks of ownership have not completely transferred to the financing party of $232.1 million. This includes a net capitalization of stock-based compensation cost for these assets of $3.2 million.

⁶ Other long-term assets — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements and similar arrangements whereby the timing difference of capacity billings to end customers and the payments received from the financing entity is recorded within long term receivables and prepaid property tax and insurance payments are now classified within other long-term assets, rather than offset against long-term deferred revenue.

⁷ Accrued warranty — The correction of these misstatements resulted from the change of accounting for accrued warranty which is now recorded on an as-incurred basis for our Managed Services Agreements and similar arrangements, reducing accrued warranty by $0.5 million and the change of accounting for the grid pricing escalation guarantees we provided in some of our sales arrangements, which are now recorded as derivative liabilities, reducing accrued warranty by $0.7 million.

⁸Accrued expense and other current liabilities and other long-term liabilities — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements, for which historical accrued liabilities recorded at inception of the agreements, as well as subsequent reductions of those liabilities, were reversed, and an increase to accrued liabilities to correct a misstatement related to an in-transit inventory shipment of $0.7 million.

⁹ Financing obligations, current and non-current — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements and similar arrangements, whereby instead of recognizing the upfront proceeds received from the bank as revenue, the proceeds received are classified as financing obligations.

¹⁰Deferred revenue and customer deposits, current and non-current — The correction of these misstatements resulted from the change of accounting for the recognition of product and installation revenue from upfront or ratable recognition to recognition of the capacity payments received from the end customer as power is generated by the Energy Servers as electricity revenue.

¹¹Derivative liabilities — The correction of these misstatements resulted from the change of accounting for embedded derivatives related to grid pricing escalation guarantees we provided in some of our sales arrangements. These are now recorded as derivative liabilities and were previously treated as an accrued liability.

¹²APIC — Relates to the correction of an unadjusted misstatement in the valuation of our 6% Notes derivative, resulting in a credit to additional paid-in capital and additional expense of $0.8 million.

Bloom Energy Corporation

Consolidated Statement of Operations

(in thousands, except per share data)



	_{For the year ended December 31, 2018}
	_{As Previously Reported}			_{Restatement Impacts}			_{Restatement Reference}	As Restated

Revenue:
Product	$	512,322		$	(111,684	)	a	$	400,638
Installation	91,416			(23,221		)	a	68,195
Service	82,385			882			a	83,267
Electricity	55,915			24,633			a	80,548
Total revenue	742,038			(109,390		)		632,648
Cost of revenue:
Product	374,590			(93,315		)	c, d	281,275
Installation	119,474			(24,168		)	c	95,306
Service	94,639			6,050			b, d	100,689
Electricity	36,265			13,363			c	49,628
Total cost of revenue	624,968			(98,070		)		526,898
Gross profit	117,070			(11,320		)		105,750
Operating expenses:
Research and development	89,135			—				89,135
Sales and marketing	62,975			(168		)	e	62,807
General and administrative	118,817			—				118,817
Total operating expenses	270,927			(168		)		270,759
Loss from operations	(153,857		)	(11,152		)		(165,009		)
Interest income	4,322			—				4,322
Interest expense	(76,935		)	(20,086		)	f	(97,021		)
Interest expense to related parties	(8,893		)	—				(8,893		)
Other expense, net	(999		)	—				(999		)
Loss on revaluation of warrant liabilities and embedded derivatives	(21,590		)	(549		)	g	(22,139		)
Loss before income taxes	(257,952		)	(31,787		)		(289,739		)
Income tax provision	1,537			—				1,537
Net loss	(259,489		)	(31,787		)		(291,276		)
Less: net loss attributable to noncontrolling interests and redeemable noncontrolling interests	(17,736		)	—				(17,736		)
Net loss attributable to Class A and Class B common stockholders	$	(241,753	)	$	(31,787	)		$	(273,540	)
Net loss per share available to Class A and Class B common stockholders, basic and diluted	$	(4.54	)					$	(5.14	)

^aRevenue impacted by Managed Services restatements — The correction of these misstatements resulted from the change from upfront recognition of product and installation revenue to recognition of the capacity payments received from the end customer as power is generated by the Energy Servers as electricity revenue over the term of our Managed Services Agreements and similar sale-leaseback arrangements, which also impacted our service revenue allocation.

^bService cost of revenue impacted by grid pricing escalation guarantees — The correction of these misstatements resulted in a decrease in service cost of revenue of $0.5 million.

c Cost of revenue impacted by Managed Services restatements — The correction of these misstatements resulted from the change of from upfront recognition of product and installation cost of revenue to recognition of the depreciation expense on the capitalized Energy Servers over their useful life of 21 years for our Managed Services Agreements and similar sale-leaseback transactions, resulting in a decrease in product cost of revenue of $75.0 million and installation cost of revenue of $25.1 million, offset by an increase in electricity cost of revenue of $13.3 million, together with the correction of another immaterial misstatements identified to record installation cost of revenue of$0.9 million.

d Cost of revenue impacted by stock-based compensation allocation — The correction of these misstatements resulted from the capitalization of stock-based compensation costs, with a net benefit to product cost of revenue of $18.3 million and an increase in service cost of revenue of $6.5 million, due to the expensing of stock-based compensation related to field replacement units.

^e Sales and marketing — The correction of these misstatements resulted from the change of accounting for sales commission expense on an as earned basis, to accounting for the expense over the term of our Managed Services Agreements and similar sale-leaseback arrangements.

^fInterest expense — The correction of these misstatements resulted from the change of accounting for sales that should have been accounted for as financing transactions, in which the upfront consideration received from the financing party is accounted for as a financing obligations and interest expense is recognized over the term of the Managed Services Agreement using the effective interest method.

g Gain (loss) on revaluation of warrant liabilities and embedded derivatives — The correction of these misstatements resulted from the change of accounting for the grid pricing escalation guarantees we provided in some of our sales arrangements which is now recorded as a derivative liability that needs to be fair valued each period end. The liability has reduced in value by $0.2 million in 2018, resulting in a credit to this line item. In addition, we corrected a misstatement in the valuation of our 6% Notes derivative, resulting in $0.8 million of additional expense in the period.

Bloom Energy Corporation

Consolidated Statement of Operations

(in thousands, except per share data)



	For the year ended December 31, 2017
	As Previously Reported			Revision Impacts			Revision Reference	As Revised

Revenue:
Product	$	179,768		$	(22,576	)	a	$	157,192
Installation	63,226			(5,289		)	a	57,937
Service	76,904			(2,012		)	a, b	74,892
Electricity	56,098			19,504			a	75,602
Total revenue	375,996			(10,373		)		365,623
Cost of revenue:
Product	210,773			(18,412		)	c, d	192,361
Installation	59,929			(4,959		)	c	54,970
Service	83,597			1,531			b, d	85,128
Electricity	39,741			9,734			c	49,475
Total cost of revenue	394,040			(12,106		)		381,934
Gross loss	(18,044		)	1,733				(16,311		)
Operating expenses:
Research and development	51,146			—				51,146
Sales and marketing	32,415			(489		)	e	31,926
General and administrative	55,674			15			e	55,689
Total operating expenses	139,235			(474		)		138,761
Loss from operations	(157,279		)	2,207				(155,072		)
Interest income	759			—				759
Interest expense	(96,358		)	(15,681		)	f	(112,039		)
Interest expense to related parties	(12,265		)	—				(12,265		)
Other income (expense), net	(491		)	—				(491		)
Loss on revaluation of warrant liabilities and embedded derivatives	(14,995		)	(289		)	g	(15,284		)
Loss before income taxes	(280,629		)	(13,763		)		(294,392		)
Income tax provision	636			—				636
Net loss	(281,265		)	(13,763		)		(295,028		)
Less: net loss attributable to noncontrolling interests and redeemable noncontrolling interests	(18,666		)	—				(18,666		)
Net loss attributable to Class A and Class B common stockholders	$	(262,599	)	$	(13,763	)		$	(276,362	)

Net loss per share available to Class A and Class B common stockholders, basic and diluted	$	(25.62	)					$	(26.97	)

^bService revenue and service cost of revenue impacted by grid pricing escalation guarantees — The correction of these misstatements resulted in a decrease in service cost of revenue of $0.3 million and a decrease of service revenue of $3.1 million.

c Cost of revenue impacted by Managed Services restatements — The correction of these misstatements resulted from the change from upfront recognition of product and installation cost of revenue to recognition of the depreciation expense on the capitalized Energy Servers over their useful life of 21 years for our Managed Services Agreements and similar sale-leaseback transactions, resulting in product cost of revenue of $15.2 million, installation cost of revenue of $5.0 million and electricity cost of revenue of $9.7 million.

^dCost of revenue impacted by stock-based compensation allocation — The correction of these misstatements resulted from the capitalization of stock-based compensation costs, with a net benefit to product cost of revenue of $3.2 million and an increase in service cost of revenue of $1.8 million due to the expensing of stock-based compensation related to field replacement units.

^e Sales and marketing and general and administrative — The correction of these misstatements primarily resulted from the change of accounting for sales commission expense on an as earned basis, to accounting for the expense over the term of our Managed Services Agreements and similar sale-leaseback arrangements.

^g Gain (loss) on revaluation of warrant liabilities and embedded derivatives —The correction of these misstatements resulted from the change of accounting for the grid pricing escalation guarantees we provided in some of our sales arrangements which is now recorded as a derivative liability that needs to be fair valued each period end. The liability has increased in value by $0.3 million resulting in a loss on revaluation of embedded derivatives.

Bloom Energy Corporation

Consolidated Statements of Cash Flows

(in thousands)



	For the year ended December 31, 2018
	As Previously Reported			Restatement Impacts			Restatement Reference	As Restated

Cash flows from operating activities:
Net loss	$	(259,489	)	$	(31,787	)		$	(291,276	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	43,459			10,428			^A	53,887
Write-off of property, plant and equipment, net	939			—				939
Revaluation of derivative contracts	28,471			550			^B	29,021
Stock-based compensation	180,284			(11,802		)	^C	168,482
Loss on long-term REC purchase contract	200			—				200
Revaluation of stock warrants	(9,108		)	—				(9,108		)
Amortization of debt issuance cost	25,437			—				25,437
Changes in operating assets and liabilities:
Accounts receivable	(54,570		)	(453		)	^D	(55,023		)
Inventories	(42,216		)	5,242			^E	(36,974		)
Deferred cost of revenue	88,324			(74,101		)	^F	14,223
Customer financing receivable and other	4,878			—				4,878
Prepaid expenses and other current assets	(7,064		)	(968		)	^G	(8,032		)
Other long-term assets	1,897			(2,099		)	^H	(202		)
Accounts payable	18,307			—				18,307
Accrued warranty	2,426			(928		)	^I	1,498
Accrued expense and other current liabilities	(6,800		)	816			^J	(5,984		)
Deferred revenue and customer deposits	(91,996		)	70,222			^K	(21,774		)
Other long-term liabilities	18,204			1,349			^L	19,553
Net cash used in operating activities	(58,417		)	(33,531		)		(91,948		)
Cash flows from investing activities:
Purchase of property, plant and equipment	(14,659		)	(30,546		)	^M	(45,205		)
Payments for acquisition of intangible assets	(3,256		)	—				(3,256		)
Purchase of marketable securities	(103,914		)	—				(103,914		)
Proceeds from maturity of marketable securities	27,000			—				27,000
Net cash used in investing activities	(94,829		)	(30,546		)		(125,375		)
Cash flows from financing activities:
Repayment of debt	(18,770		)	—				(18,770		)
Repayment of debt to related parties	(1,390		)	—				(1,390		)
Proceeds from financing obligations	—			70,265			^N	70,265
Repayment of financing obligations	—			(6,188		)	^N	(6,188		)
Distributions to noncontrolling and redeemable noncontrolling interests	(15,250		)	—				(15,250		)
Proceeds from issuance of common stock	1,521			—				1,521
Proceeds from public offerings, net of underwriting discounts and commissions	292,529			—				292,529
Payments of initial public offering issuance costs	(5,521		)	—				(5,521		)
Net cash provided by financing activities	253,119			64,077				317,196
Net increase in cash, cash equivalents, and restricted cash	99,873			—				99,873
Cash, cash equivalents, and restricted cash:
Beginning of period	180,612			—				180,612
End of period	$	280,485		$	—			$	280,485

Supplemental disclosure of cash flow information:
Cash paid during the period for interest	$	39,465		$	20,084		^N	$	59,549
Cash paid during the period for taxes	1,748			—				1,748

^A Depreciation and amortization — The correction of these misstatements resulted from the change of accounting for Energy Servers under the Managed Services Program and similar arrangements that would have been product and install cost of revenue, but are now recorded as property, plant and equipment, and depreciated over their useful lives of 21 years.

^B Revaluation of derivative contracts — The correction of these misstatements resulted from the change of accounting for the grid pricing escalation guarantees we provided in some of our sales arrangements. These commitments were previously treated as a contingent liability and recorded as an accrued liability. We now consider the commitments a derivative liability, with the initial value recorded as a reduction in product revenue and then any changes in the value adjusted through other expense, net each period thereafter, resulting in a credit of $0.2 million, with $0.8 million of additional expense recorded to correct a misstatement in the valuation of our 6% Notes derivative.

^CStock-based compensation — The correction of these misstatements resulted from the change of accounting for stock-based compensation, including net capitalization of stock-based compensation cost into inventory of $10.3 million. The correction of this misstatement also resulted in the capitalization of $1.5 million of stock-based compensation costs related to assets, under the Managed Services Program now recorded as construction in progress within property, plant and equipment, net.

^DAccounts receivable — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements and similar arrangements where the timing difference of capacity billings to end customers and the payments received from the financing entity is recorded within accounts receivable.

^EInventories — The correction of these misstatements resulted from the change of accounting for inventories, held for shipments planned to customers under the Managed Services Program and other similar arrangements now accounted for as construction in progress within property, plant and equipment, net.

^F Deferred cost of revenue, current and non-current — The correction of these misstatements resulted from the cumulative net change of accounting moving deferred cost of revenue to property, plant and equipment, net for the leased Energy Servers under the Managed Services Agreements and similar sale-leaseback arrangements of $71.9 million, and the net capitalization of stock-based compensation costs of $2.2 million in current deferred cost of revenue.

^G Prepaid expenses and other current assets — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements and similar arrangements where prepaid property tax and insurance payments are now classified within prepaid expenses, rather than offset against deferred revenue.

^H Other long-term assets — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements and similar arrangements, including the timing difference of capacity billings to end customers of $0.1 million, payments received from the financing entity now recorded within long term receivables of $1.9 million, and commission payments now classified within long term commission expenses of $0.1 million.

^IAccrued warranty — The correction of these misstatements resulted from the change of accounting for accrued warranty which is now recorded on an as-incurred basis on our Managed Services Agreements and similar arrangements. The correction of these misstatements resulted from the change of accounting for the grid pricing escalation guarantees we've provided in some of our sales arrangements. These commitments were previously treated as a contingent liability that was considered remote and therefore, no accrual was made. We now consider $0.3 million accrual has made, with the initial value of treated as a reduction in product revenue and then any changes in the value adjusted through other expense, net each period thereafter.

^JAccrued expense and other current liabilities and other long-term liabilities — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements and similar arrangements where instead of recognizing the bank financing as revenue, the bank financing loan proceeds received and due are classified as lease loan liability.

^KDeferred revenue and customer deposits, current and non-current — The correction of these misstatements resulted from the change of accounting for the recognition of product and installation revenue from upfront or ratable recognition to the recognition of the capacity payments received from the end customer as power is generated by the Energy Servers as electricity revenue.

^L Other long-term liabilities — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements and similar arrangements where instead of recognizing the bank financing as revenue, the bank financing loan proceeds received and due beyond the next twelve months are classified as lease loan liability.

^MPurchase of property, plant and equipment — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements and similar arrangements, whereby costs previously recognized as product and install costs of goods sold are now recorded as property, plant and equipment, net in the cases where the risks of ownership have not completely transferred to the financing party.

^NProceeds and repayments from financing obligations — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements and similar arrangements where instead of recognizing the upfront proceeds received from the bank as revenue, the bank proceeds received and due are classified as proceeds from financing obligations and the capacity payments received from the end customer are classified as repayment of financing obligations and interest paid.

Bloom Energy Corporation

Consolidated Statements of Cash Flows

(in thousands)



	For the year ended December 31, 2017
	As Previously Reported			Revision Impacts			Revision Reference	As Revised

Cash flows from operating activities:
Net loss	$	(281,265	)	$	(13,763	)		$	(295,028	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	46,105			8,271			A	54,376
Write-off of property, plant and equipment, net	48			—				48
Revaluation of derivative contracts	14,754			288			B	15,042
Stock-based compensation	30,479			(1,378		)	C	29,101
Gain on long-term REC purchase contract	(70		)	—				(70		)
Revaluation of stock warrants	(2,975		)	—				(2,975		)
Amortization of debt issuance cost	47,312			—				47,312
Changes in operating assets and liabilities:
Accounts receivable	4,849			(1,607		)	D	3,242
Inventories	(7,105		)	(3,531		)	E	(10,636		)
Deferred cost of revenue	(70,979		)	39,701			F	(31,278		)
Customer financing receivable and other	5,459			—				5,459
Prepaid expenses and other current assets	(2,175		)	1,193			G	(982		)
Other long-term assets	4,625			(3,869		)	H	756
Accounts payable	7,076			—				7,076
Accrued warranty	(7,045		)	(320		)	I	(7,365		)
Accrued expense and other current liabilities	8,599			(602		)	J	7,997
Deferred revenue and customer deposits	91,893			(43,571		)	K	48,322
Other long-term liabilities	43,239			(5,602		)	L	37,637
Net cash used in operating activities	(67,176		)	(24,790		)		(91,966		)
Cash flows from investing activities:
Purchase of property, plant and equipment	(5,140		)	(56,314		)	M	(61,454		)
Purchase of marketable securities	(29,043		)	—				(29,043		)
Proceeds from maturity of marketable securities	2,250			—				2,250
Net cash used in investing activities	(31,933		)	(56,314		)		(88,247		)
Cash flows from financing activities:
Borrowings from issuance of debt	100,000			—				100,000
Repayment of debt	(20,507		)	—				(20,507		)
Repayment of debt to related parties	(912		)	—				(912		)
Debt issuance costs	(6,108		)	—				(6,108		)
Proceeds from financing obligations	—			84,314			N	84,314
Repayment of financing obligations	—			(3,210		)	N	(3,210		)
Proceeds from noncontrolling and redeemable noncontrolling interests	13,652			—				13,652
Distributions to noncontrolling and redeemable noncontrolling interests	(23,659		)	—				(23,659		)
Proceeds from issuance of common stock	432			—				432
Payments of initial public offering issuance costs	(1,092		)	—				(1,092		)
Net cash provided by financing activities	61,806			81,104				142,910
Net decrease in cash, cash equivalents, and restricted cash	(37,303		)	—				(37,303		)
Cash, cash equivalents, and restricted cash:
Beginning of period	217,915			—				217,915
End of period	$	180,612		$	—			$	180,612

Supplemental disclosure of cash flow information:
Cash paid during the period for interest	$	21,948		$	15,680		N	$	37,628
Cash paid during the period for taxes	616			—				616

^A Depreciation and amortization — The correction of these misstatements resulted from the change of accounting for Energy Servers under the Managed Services Program and other similar arrangements that would have been product and install costs of goods sold, but are now recorded as property, plant and equipment, and depreciated over their useful lives of 21 years.

^B Revaluation of derivative contracts - The correction of these misstatements resulted from the change of accounting for the grid pricing escalation guarantees we provided in some of our sales arrangements. These commitments were previously treated as a contingent liability and recorded as an accrued liability. We now consider the commitments a derivative liability, with the initial value recorded as a reduction in product revenue and then any changes in the value adjusted through other expense, net each period thereafter.

^C Stock-based compensation — The correction of these misstatements resulted from the change of accounting for stock-based compensation, including net capitalization of stock-based compensation cost into inventory of $0.6 million. The correction of this misstatement also resulted in the capitalization of $0.7 million of stock-based compensation, cost related to assets, under the Managed Services Program now recorded as construction in progress within property, plant and equipment, net.

^E Inventories — The correction of these misstatements resulted from the change of accounting for inventories, held for shipments planned to customers under the Managed Services Program and other similar arrangements now accounted for as construction in progress within property, plant and equipment, net.

^F Deferred cost of revenue, current and non-current — The correction of these misstatements resulted from the change of accounting moving deferred cost of revenue to property, plant and equipment, net for the leased Energy Servers under the Managed Services Agreements and similar sale-leaseback arrangements of $39.1 million, and the net capitalization of stock-based compensation costs of $0.6 million in current deferred cost of revenue.

^H Other long-term assets — The correction of these misstatements resulted from the change of accounting for Managed Services Agreements and similar arrangements, including the timing difference of capacity billings to end customers of $1.7 million, payments received from the financing entity now recorded within long term receivables of $1.8 million, and commission payments now classified within long term commission expenses of $0.4 million.