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Is QuantumScape in a Bubble After Its Blistering One-Month Rally?
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Key Takeaways
QuantumScape's Cobra separator is 25x faster and cuts costs as it targets large-scale battery production.
VWAGY's PowerCo pledged another $131M to expand QSE-5 development and fund a pilot line in San Jose.
QS is yet to generate revenues with a $123.6M Q2 loss and sees up to $270M in negative EBITDA for 2025.
The solid-state battery startup QuantumScape (QS - Free Report) has seen its stock more than double over the past month, fueled by a mix of technical breakthroughs and renewed excitement around its deepening partnership with German auto giant Volkswagen (VWAGY - Free Report) . While QuantumScape’s story and potential might be compelling, its recent surge raises questions about whether the stock has run too far, too fast. Let’s take a closer look at what’s really happening under the hood.
1 Month Price Performance Comparison
Image Source: Zacks Investment Research
QS’ Cobra Separator: A Game-Changer for Speed and Scale
At the center of QuantumScape’s latest momentum is its Cobra separator process, which reached baseline production in June. That’s a major step toward commercializing its QSE-5 solid-state lithium-metal batteries, which promise faster charging, greater energy density and better safety than today’s lithium-ion alternatives.
Cobra is a big deal because it replaces the company’s older Raptor system and is 25 times faster, takes up less space, and is much more cost-effective. That matters in a world where scalability is the name of the game. Building a better battery in a lab is one thing. Manufacturing it at a gigawatt-hour scale is a different game altogether. Cobra brings QuantumScape one step closer to that goal. This new production capability lays the groundwork for ramping up B1 sample production, which will be used in early field tests in 2026.
VWAGY’s PowerCo Is Charging QS’ Journey
One of QuantumScape’s biggest strengths lies in its strategic relationship with Volkswagen. Volkswagen’s battery subsidiary PowerCo has been a long-time backer.
Last week, the two companies expanded their collaboration to speed up development of the QSE-5 battery and to establish a pilot line in San Jose. PowerCo will provide up to $131 million in milestone-based payments over the next two years, on top of the initial $130 million tied to the eventual licensing deal.
The additional capital infusion will extend QuantumScape’s cash runway into 2029, giving the company more breathing room as it advances toward commercialization. That translates to an extra six months of financing flexibility.
Just as important, Volkswagen isn’t just a funder—it’s also positioned to be QuantumScape’s first customer. By following a capital-light licensing model, QuantumScape plans to license its technology to battery makers and automakers instead of building costly factories itself. That’s a smart way to reduce risk, but also a model that hinges heavily on successful execution and strong partnerships.
The Challenges Are Real—QS Seems Too Pricey Now
While all these developments are creating much excitement around the stock, investors should be careful not to get carried away. QuantumScape is still pre-revenues, meaning it hasn’t sold a single commercial battery yet. Its operating loss for the second quarter of 2025 was $123.6 million. Adjusted EBITDA was negative $63 million in the last reported quarter and management expects loss before interest, taxes, depreciation and amortization to be between $250 million and $270 million for the full year.
Yes, the company is cutting costs and improving processes, thanks in part to Cobra, but the road ahead is still long. Commercial-scale production and field testing won’t begin until 2026 at the earliest, and solid-state battery development is notorious for running into technical and manufacturing hurdles.
Another concern is the stock’s valuation. With shares more than doubling recently, expectations are sky-high—perhaps too high for a company still years away from revenues. QS’s current valuation is largely driven by future expectations, making it highly sensitive to shifts in market sentiment. A change in investor mood could send the stock down just as quickly as it climbed.
QuantumScape Corporation Price, Consensus and EPS Surprise
If you're an investor who’s in it for the long haul, QuantumScape offers a high-risk, high-reward opportunity. Its solid-state battery technology could reshape the EV industry—if it works as intended and scales effectively. The Cobra process is a promising development, and the Volkswagen partnership provides both validation and a potential path to market.
But for more cautious investors, the stock may look overheated right now. The road to commercializing solid-state batteries for mass-market vehicles is fraught with technical and logistical hurdles. The real challenge lies in scaling up production efficiently and cost-effectively. And while Cobra and capital inflows are encouraging, QS remains a speculative bet. The battery tech buzz is there, but remember the long road and risks ahead.
Image: Bigstock
Is QuantumScape in a Bubble After Its Blistering One-Month Rally?
Key Takeaways
The solid-state battery startup QuantumScape (QS - Free Report) has seen its stock more than double over the past month, fueled by a mix of technical breakthroughs and renewed excitement around its deepening partnership with German auto giant Volkswagen (VWAGY - Free Report) . While QuantumScape’s story and potential might be compelling, its recent surge raises questions about whether the stock has run too far, too fast. Let’s take a closer look at what’s really happening under the hood.
1 Month Price Performance Comparison
QS’ Cobra Separator: A Game-Changer for Speed and Scale
At the center of QuantumScape’s latest momentum is its Cobra separator process, which reached baseline production in June. That’s a major step toward commercializing its QSE-5 solid-state lithium-metal batteries, which promise faster charging, greater energy density and better safety than today’s lithium-ion alternatives.
Cobra is a big deal because it replaces the company’s older Raptor system and is 25 times faster, takes up less space, and is much more cost-effective. That matters in a world where scalability is the name of the game. Building a better battery in a lab is one thing. Manufacturing it at a gigawatt-hour scale is a different game altogether. Cobra brings QuantumScape one step closer to that goal. This new production capability lays the groundwork for ramping up B1 sample production, which will be used in early field tests in 2026.
VWAGY’s PowerCo Is Charging QS’ Journey
One of QuantumScape’s biggest strengths lies in its strategic relationship with Volkswagen. Volkswagen’s battery subsidiary PowerCo has been a long-time backer.
Last week, the two companies expanded their collaboration to speed up development of the QSE-5 battery and to establish a pilot line in San Jose. PowerCo will provide up to $131 million in milestone-based payments over the next two years, on top of the initial $130 million tied to the eventual licensing deal.
The additional capital infusion will extend QuantumScape’s cash runway into 2029, giving the company more breathing room as it advances toward commercialization. That translates to an extra six months of financing flexibility.
Just as important, Volkswagen isn’t just a funder—it’s also positioned to be QuantumScape’s first customer. By following a capital-light licensing model, QuantumScape plans to license its technology to battery makers and automakers instead of building costly factories itself. That’s a smart way to reduce risk, but also a model that hinges heavily on successful execution and strong partnerships.
The Challenges Are Real—QS Seems Too Pricey Now
While all these developments are creating much excitement around the stock, investors should be careful not to get carried away. QuantumScape is still pre-revenues, meaning it hasn’t sold a single commercial battery yet. Its operating loss for the second quarter of 2025 was $123.6 million. Adjusted EBITDA was negative $63 million in the last reported quarter and management expects loss before interest, taxes, depreciation and amortization to be between $250 million and $270 million for the full year.
Yes, the company is cutting costs and improving processes, thanks in part to Cobra, but the road ahead is still long. Commercial-scale production and field testing won’t begin until 2026 at the earliest, and solid-state battery development is notorious for running into technical and manufacturing hurdles.
Another concern is the stock’s valuation. With shares more than doubling recently, expectations are sky-high—perhaps too high for a company still years away from revenues. QS’s current valuation is largely driven by future expectations, making it highly sensitive to shifts in market sentiment. A change in investor mood could send the stock down just as quickly as it climbed.
QuantumScape Corporation Price, Consensus and EPS Surprise
QuantumScape Corporation price-consensus-eps-surprise-chart | QuantumScape Corporation Quote
How to Play QuantumScape Stock Now
If you're an investor who’s in it for the long haul, QuantumScape offers a high-risk, high-reward opportunity. Its solid-state battery technology could reshape the EV industry—if it works as intended and scales effectively. The Cobra process is a promising development, and the Volkswagen partnership provides both validation and a potential path to market.
But for more cautious investors, the stock may look overheated right now. The road to commercializing solid-state batteries for mass-market vehicles is fraught with technical and logistical hurdles. The real challenge lies in scaling up production efficiently and cost-effectively. And while Cobra and capital inflows are encouraging, QS remains a speculative bet. The battery tech buzz is there, but remember the long road and risks ahead.
After such a sharp run-up in the stock, it would be wise to wait for a better entry point. The stock currently carries a Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Wall Street average target price of $4.79 for QS stock suggests a downside of roughly 60% from current levels.