SES AI Corporation (SES 0.54%) might not get as much press as other, more famous, artificial intelligence (AI) companies, so you may not have heard that the stock is up over 400% in the past 12 months. SES is on a mission to create the next generation of lithium batteries.

The lithium battery industry is ripe for modernization, as well as AI innovation, with real-world applications in automobiles, drones, and more. The company also recently released its AI software, Molecular Universe, to the public. This technology accelerates battery material discovery and creates the most thorough database and service platform for this process.

The Boston-based company was founded in 2012 and went public via a special purpose acquisition company in 2022. Although the stock has increased by more than 400% this year, it still trades at under $2 per share. The market cap currently sits under $700 million.

SES could make early investors millionaires because of its recent good news. The company has revised its revenue guidance upwards, acquired UZ Energy, and announced new joint ventures. The outlook appears promising for SES as it seeks to accelerate its commercial production.

Image source: Getty Images.

For these reasons, SES could make long-term investors millionaires if they’re willing to take on more risk in the tech and AI sector and hold the stock through the next few years of volatility.

Is the stock up on hype or reality?

The company’s dramatic stock rise doesn’t yet reflect the reality of its financials. However, real improvements are happening on SES’s balance sheet. The company’s November Q3 earnings report revealed SES saw substantial increases in revenue, a lower net loss, and a repurchasing of shares. These are all positive indicators for the long-term success of the battery producer.

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SES’s acquisition of UZ Energy and a partnership with Hisun New Energy Materials mark a turning point for the company. These ventures demonstrate its commitment to improving the scale and speed of commercial production.

The projected compound annual growth rate (CAGR) for the energy storage industry, a major facet of SES’s business, is expected to be 27% over the next five years. If investors assume SES can maintain a CAGR of 20% for the next 20 years, a $25,000 investment in the company now would be worth nearly $1 million in 2045.

SES needs to slow its cash burn

SES’s revenue is still modest at just $7.1 million in the third quarter of 2025, so profitability isn’t on the near-term horizon. There are also still plenty of execution risks ahead as the company attempts to scale at a faster pace.

Again, the revenue guidance was increased in the most recent quarter from $20 million to $25 million, but SES is still burning a lot of cash. The company is on track to once again exceed $100 million in operating expenses. While the company has sufficient liquidity, it’s going to need to effectively grow revenue continuously over the next few years. Lithium batteries aren’t easy to scale, either. Safety in this space is a tremendous challenge.

Those who are bearish on SES’s capabilities point out that the stock’s incredible rise this year is mostly based on hype. The company benefited from renewed interest in AI companies and optimism surrounding the future of electric vehicles.

Gaining traction in a quickly growing market

While the 400% rise was likely more about investor sentiment across the broader industry than SES itself, there are plenty of reasons to be excited about the future of this company.

The total addressable market for SES’s battery innovations is massive. From ground transportation to aerospace and energy storage, the market for lithium batteries could exceed $500 billion by 2032. If SES proves it can scale with the help of its new partners, there’s a lot of revenue and market share left to capture.

For investors looking to get in early and willing to add a speculative tech stock to their portfolio, SES is a solid choice. The company already has a global footprint, with operations in Boston, Singapore, Shanghai, and Seoul. The appetite for technological advancements in the lithium battery space is also growing again.

Now is the time for SES to capitalize on the opportunity. If it does so successfully, early investors could be rewarded handsomely.