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QuantumScape Stock Down 46% in a Month: Time to Buy the Dip?
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Key Takeaways
QS stock tumbled after traders took profits following a hype-driven rally on new technology news.
An expanded PowerCo deal adds up to $131M in milestone payments and wider licensing rights.
The COBRA process boosts productivity 25-fold, while liquidity now supports operations into 2029.
QuantumScape (QS - Free Report) has had a rough ride lately. Shares of the solid-state battery innovator have plunged nearly 46% over the past month, raising the question of whether the selloff is a red flag or an opportunity. While volatility has always been part of the QuantumScape story, the company’s progress on technology and partnerships has left investors wondering if the recent pullback should be considered as an attractive entry point.
QuantumScape Corporation Price, Consensus and EPS Surprise
The recent sell-off wasn’t driven by any major negative development at the company. Instead, it was a classic case of traders cashing in after a hype-driven rally.
The company’s announcement of its new “Cobra” separator technology in late June had sparked a frenzy, sending shares up more than 50% in just a week. On July 18, the stock hit a 52-week high of $15.03. Fast forward to the present, QS shares fell more than 10% yesterday to close the session at $7.91. Of course, what surges in euphoria also sinks fast. Soon, traders who piled in on the hype were just as quick to lock in gains.
The truth is that nothing fundamentally changed in the near term. QuantumScape is still in the R&D phase, burning cash and working toward its first real revenue stream. So, once the retail hype cooled off, the valuation disconnect became hard to ignore.
Image Source: Zacks Investment Research
Long-term Narrative for QS Intact
Despite the stock’s slide, QuantumScape continues to make meaningful strides in its solid-state battery development.
The PowerCo Partnership Gets Bigger: QuantumScape expanded collaboration with PowerCo, Volkswagen’s (VWAGY - Free Report) battery subsidiary. This upgrade to their existing agreement introduces up to $131 million in new milestone-based payments over the next two years, in addition to the $130 million already lined up under the original deal. On the latest earnings call, management notified that the first milestone has already been met, triggering more than $10 million in expected payments that will be invoiced in the third quarter of 2025.
Even more significant is the fact that the scope of the deal has widened. PowerCo now has the right to produce up to 85 gigawatt hours of QuantumScape cells annually under license, including for customers outside the Volkswagen family. It has also secured rights to future generations of QuantumScape technology beyond the first-gen QSE-5 platform. Additionally, QuantumScape’s San Jose pilot line is now prioritizing QSE-5 output for PowerCo. That means resources are firmly aligned with the company’s largest commercial opportunity.
The COBRA Power: On the technology front, QS has made a critical transition. The new COBRA separator process has replaced the old Raptor process as the company’s baseline for production. According to CEO Siva Sivaram, COBRA delivers a 25-fold productivity improvement over Raptor and 200 times greater output than what was achieved early in 2023.
That’s the kind of breakthrough needed to make solid-state batteries commercially viable. Already, COBRA is enabling the next wave of customer samples. The company has shipped its final Raptor-based B0 samples for safety testing and will now move to COBRA-based B1 samples, which should be more scalable and manufacturable. These shipments are designed to give customers real-world validation, with field testing still targeted for 2026.
Expanding Beyond Volkswagen: QuantumScape is no longer tied solely to Volkswagen. The company announced it has signed a joint development agreement (JDA) with another major global automotive OEM.
This is a big step beyond simple sample shipments — it’s a formal collaboration aimed at commercialization and licensing. While management hasn’t named the automaker, the fact that another global player has moved into deeper partnership mode is strong evidence of accelerating traction. Combined with the ongoing collaboration with Murata Manufacturing on ceramics, QuantumScape is widening its ecosystem of partners and markets.
Stronger Cash Runway: One of the biggest risks with any pre-revenue company is cash burn. Here, QuantumScape provided welcome reassurance. The company ended the second quarter of 2025 with $797.5 million in liquidity, and thanks to the expanded PowerCo deal, it has extended its cash runway into 2029. That’s six months longer than previously projected — a meaningful cushion in an industry where development timelines can stretch. As CFO Kevin Hettrich pointed out, the milestone payments will also help reduce net losses and improve the bottom line.
The consensus mark for QS’ 2025 loss has narrowed over the past 60 days.
Image Source: Zacks Investment Research
Is This a Buying Opportunity?
While the stock has been hit hard lately, beneath the noise, the actual business story is strengthening. QuantumScape now has two major auto partners formally engaged, a technology that just took a major leap forward in manufacturability, and a financial position strong enough to carry it well into the back half of the decade.
Yes, the road to commercialization remains challenging, and volatility will likely remain high, but the fundamentals look strong now. For investors willing to weather short-term volatility, this could be exactly the kind of dip worth buying for long-term gains.
Image: Bigstock
QuantumScape Stock Down 46% in a Month: Time to Buy the Dip?
Key Takeaways
QuantumScape (QS - Free Report) has had a rough ride lately. Shares of the solid-state battery innovator have plunged nearly 46% over the past month, raising the question of whether the selloff is a red flag or an opportunity. While volatility has always been part of the QuantumScape story, the company’s progress on technology and partnerships has left investors wondering if the recent pullback should be considered as an attractive entry point.
QuantumScape Corporation Price, Consensus and EPS Surprise
QuantumScape Corporation price-consensus-eps-surprise-chart | QuantumScape Corporation Quote
QuantumScape Shares Selloff Explained
The recent sell-off wasn’t driven by any major negative development at the company. Instead, it was a classic case of traders cashing in after a hype-driven rally.
The company’s announcement of its new “Cobra” separator technology in late June had sparked a frenzy, sending shares up more than 50% in just a week. On July 18, the stock hit a 52-week high of $15.03. Fast forward to the present, QS shares fell more than 10% yesterday to close the session at $7.91. Of course, what surges in euphoria also sinks fast. Soon, traders who piled in on the hype were just as quick to lock in gains.
The truth is that nothing fundamentally changed in the near term. QuantumScape is still in the R&D phase, burning cash and working toward its first real revenue stream. So, once the retail hype cooled off, the valuation disconnect became hard to ignore.
Long-term Narrative for QS Intact
Despite the stock’s slide, QuantumScape continues to make meaningful strides in its solid-state battery development.
The PowerCo Partnership Gets Bigger: QuantumScape expanded collaboration with PowerCo, Volkswagen’s (VWAGY - Free Report) battery subsidiary. This upgrade to their existing agreement introduces up to $131 million in new milestone-based payments over the next two years, in addition to the $130 million already lined up under the original deal. On the latest earnings call, management notified that the first milestone has already been met, triggering more than $10 million in expected payments that will be invoiced in the third quarter of 2025.
Even more significant is the fact that the scope of the deal has widened. PowerCo now has the right to produce up to 85 gigawatt hours of QuantumScape cells annually under license, including for customers outside the Volkswagen family. It has also secured rights to future generations of QuantumScape technology beyond the first-gen QSE-5 platform. Additionally, QuantumScape’s San Jose pilot line is now prioritizing QSE-5 output for PowerCo. That means resources are firmly aligned with the company’s largest commercial opportunity.
The COBRA Power: On the technology front, QS has made a critical transition. The new COBRA separator process has replaced the old Raptor process as the company’s baseline for production. According to CEO Siva Sivaram, COBRA delivers a 25-fold productivity improvement over Raptor and 200 times greater output than what was achieved early in 2023.
That’s the kind of breakthrough needed to make solid-state batteries commercially viable. Already, COBRA is enabling the next wave of customer samples. The company has shipped its final Raptor-based B0 samples for safety testing and will now move to COBRA-based B1 samples, which should be more scalable and manufacturable. These shipments are designed to give customers real-world validation, with field testing still targeted for 2026.
Expanding Beyond Volkswagen: QuantumScape is no longer tied solely to Volkswagen. The company announced it has signed a joint development agreement (JDA) with another major global automotive OEM.
This is a big step beyond simple sample shipments — it’s a formal collaboration aimed at commercialization and licensing. While management hasn’t named the automaker, the fact that another global player has moved into deeper partnership mode is strong evidence of accelerating traction. Combined with the ongoing collaboration with Murata Manufacturing on ceramics, QuantumScape is widening its ecosystem of partners and markets.
Stronger Cash Runway: One of the biggest risks with any pre-revenue company is cash burn. Here, QuantumScape provided welcome reassurance. The company ended the second quarter of 2025 with $797.5 million in liquidity, and thanks to the expanded PowerCo deal, it has extended its cash runway into 2029. That’s six months longer than previously projected — a meaningful cushion in an industry where development timelines can stretch. As CFO Kevin Hettrich pointed out, the milestone payments will also help reduce net losses and improve the bottom line.
The consensus mark for QS’ 2025 loss has narrowed over the past 60 days.
Is This a Buying Opportunity?
While the stock has been hit hard lately, beneath the noise, the actual business story is strengthening. QuantumScape now has two major auto partners formally engaged, a technology that just took a major leap forward in manufacturability, and a financial position strong enough to carry it well into the back half of the decade.
Yes, the road to commercialization remains challenging, and volatility will likely remain high, but the fundamentals look strong now. For investors willing to weather short-term volatility, this could be exactly the kind of dip worth buying for long-term gains.
The stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here