Shares of Gevo (NASDAQ:GEVO) surged 9.43% in after-hours trading on Monday following the release of the company's third-quarter 2025 financial results. The renewable fuels company reported a smaller-than-expected loss and achieved positive Adjusted EBITDA for the second consecutive quarter, signaling progress in its business strategy.

Gevo reported a quarterly loss of $0.03 per share, beating analyst consensus estimates of a $0.06 loss by 52.38%. This marks a significant improvement from the $0.09 loss per share in the same period last year. The company's revenue for the quarter came in at $42.71 million, falling short of the analyst consensus estimate of $46.915 million but representing a substantial increase from $1.965 million in the previous year.

Investors appear to be encouraged by Gevo's achievement of positive Adjusted EBITDA of approximately $6.7 million, attributed to consistent performance at its Gevo North Dakota and renewable natural gas facilities. The company also highlighted ongoing efforts to strengthen profitability, including the sale of its Agri-Energy subsidiary, which is expected to eliminate $3 million in annual idling costs. Additionally, Gevo signed a multi-year carbon credit sales agreement projected to generate $26 million over five years, further diversifying its revenue streams. With these developments and the company's focus on optimizing operations, Gevo sees potential for $100 million in adjusted EBITDA, which may be driving investor optimism and contributing to the stock's after-hours rally.