All aboard, investors. This fuel cell energy train may be about ready to leave the station.
Bloom Energy (BE 9.01%) stock soared 11% through 9:50 a.m. ET after reporting an earnings miss but a revenue beat last night.
Heading into the quarter, analysts forecast the fuel cell energy stock would lose $0.04 per share on $307.5 million in sales. Bloom’s losses were bigger than expected at $0.06 per share. However, sales came in much stronger than expected at $335.8 million — and investors seem to like that news a lot.
Bloom Energy Q2 earnings
Admittedly, even Bloom’s $0.06-per-share loss was only a non-GAAP number. Earnings as calculated according to generally accepted accounting principles (GAAP) show a much bigger loss for the quarter — $0.27 per share. But even so, Bloom’s results showed considerable improvements over its year-ago numbers.
Sales improved 11.5% year over year. Gross profit margins were positive and up by 170 basis points. Operating profit margins — still negative at 6.9% — were up significantly from a year ago (negative 18.1%), so Bloom is losing less money on more revenue and seems to be enjoying some benefits of scale.
Losses per share declined by 16%, despite Bloom buying back shares and shrinking its share count, which concentrates losses among fewer outstanding shares.
Is Bloom Energy stock a buy?
Turning to guidance, Bloom still isn’t predicting when it will turn GAAP profitable, which makes it difficult to value the stock (or call it a buy or a sell). Still, management reaffirmed guidance for full-year sales of between $1.4 billion and $1.6 billion, and the latter number is above analyst estimates. Management also forecast significant improvement in gross profit margins to 28%. Granted, this was a non-GAAP number, but it’s still better than Q2’s non-GAAP gross profit margin of 21.8% — which was itself an improvement over Q2 2023.
Bloom also predicted that its non-GAAP operating income for the year will be positive, running somewhere between $75 million and $100 million. Call me an optimist, but it really seems Bloom Energy stock is close to turning profitable — if not this year, then probably in 2025.
Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
