Plug Power (NASDAQ:PLUG) stock is in the red today despite the company announcing that it has finalized a contract to provide an undisclosed “major U.S. automobile manufacturer” with hydrogen infrastructure and fuel-cell solutions. Plug will help support its material handling operations, such as its forklifts and tuggers.
The manufacturer has one of the largest manufacturing campuses in the U.S., encompassing over six square miles. The campus also has a focus on electric vehicles (EVs) and batteries. With the assistance of Plug, the campus’ material handling fleet will be powered by fuel cells. In addition, Plug will provide the manufacture with two liquid hydrogen storage tanks and several hydrogen dispensers.
“We are excited to elevate this facility with Plug’s state-of-the-art green hydrogen ecosystem, offering solutions that enhance operational efficiency while contributing to a more sustainable and environmentally responsible future,” said Plug CEO Andy Marsh.
PLUG Stock: Plug Finalizes Contract with ‘Major’ Auto Manufacturer
Plug Power will begin installing the hydrogen infrastructure for the manufacturer this year, with an estimated completion date of Q1 2025. After that, production will begin in phases in preparation for a full ramp-up. Plug will likely use its prior experience with other auto manufacturers, like BMW (OTCMKTS:BMWYY) and Honda (NYSE:HMC), to make the installation process more efficient.
Meanwhile, a major catalyst for PLUG stock is just around the corner. Today, the green hydrogen company announced that it will report its fourth-quarter earnings on March 1 before the market open. For the period, analysts expect a 8.07% year-over-year (YOY) decline to $203 million and a GAAP EPS loss of 41 cents. For the full year of 2023, analysts also expect revenue growth of 27.18% to $892 million and a GAAP EPS loss of $1.63 per share compared to a 2022 loss of $1.25.
During the past few years, Plug has demonstrated that it can grow its sales at a fast pace. However, profitability remains a major issue for the company. While sales have grown, net losses have also grown while margins have declined. Last week, the company announced a plan that would reduce its annual operational expenses by over $75 million.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
