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Plug Power Remains Plagued by Margin Woes: Can It Buck the Trend?
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Key Takeaways
Plug Power's Q3 gross margin fell to negative 67.9% as losses widened and cost pressures persisted.
High equipment costs, fuel delivery expenses and $97M in impairments further hurt Plug Power.
Plug Power targets lower input costs and expanded electrolyzer and hydrogen plant capacity to recover.
Plug Power Inc. (PLUG - Free Report) continues to grapple with persistent margin challenges despite undertaking cost-control initiatives. The company is focusing on improving its supply chain, optimizing its workforce and reorganizing its manufacturing and real estate setup. These steps are meant to lower expenses and help improve margins over time.
However, Plug Power’s latest results show that the challenges are far from over. The company’s gross margin decreased from negative 57.6% in the third quarter of 2024 to negative 67.9% in the third quarter of 2025. PLUG also reported a gross loss of $120 million in the quarter, up 20% on a year-over-year basis. High equipment costs and rising fuel delivery expenses continued to hurt profitability.
Also, Plug Power incurred more than $97 million in impairment charges during the third quarter. This included reductions in the value of property, plant and equipment, prepaid capital expenses, contract assets, right-of-use assets and equipment tied to power purchase agreements. These write-downs occurred because it is dealing with project execution challenges, customer disputes and changes in its site and real estate plans, all of which forced Plug Power to lower the value of several assets and added further pressure to its financial results.
Despite the adversities, the company remains committed to long-term recovery. By lowering input costs, tightening spending and expanding electrolyzer capacity and hydrogen plant development, Plug Power aims to improve its margin trajectory.
Margin Performance of PLUG’s Peers
Among PLUG’s major peers, Bloom Energy Corp.’s (BE - Free Report) cost of revenues surged 46% year over year in the third quarter of 2025. However, Bloom Energy’s gross profit rose 92.6% year over year. Bloom Energy’s gross margin expanded 540 basis points to 29.2%, driven by productivity gains, higher volumes and favorable pricing.
Plug Power’s another peer, Flux Power Holdings, Inc.’s (FLUX - Free Report) total cost of sales was $9.41 million, down 13.7% year over year in the fiscal first quarter of 2026 (ended September 2025). However, Flux Power’s gross profit declined 27.8% year over year. Flux Power’s gross margin decreased 380 basis points, due to lower average selling prices.
The Zacks Rundown for PLUG
Shares of Plug Power have gained 1.4% in the year-to-date period compared with the industry’s growth of 35%.
Image Source: Zacks Investment Research
From a valuation standpoint, Plug Power is trading at a forward price-to-earnings ratio of a negative 5.99X against the industry average of 25.01X. PLUG carries a Value Score of F.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for PLUG’s bottom line has decreased in the past 60 days.
Image: Bigstock
Plug Power Remains Plagued by Margin Woes: Can It Buck the Trend?
Key Takeaways
Plug Power Inc. (PLUG - Free Report) continues to grapple with persistent margin challenges despite undertaking cost-control initiatives. The company is focusing on improving its supply chain, optimizing its workforce and reorganizing its manufacturing and real estate setup. These steps are meant to lower expenses and help improve margins over time.
However, Plug Power’s latest results show that the challenges are far from over. The company’s gross margin decreased from negative 57.6% in the third quarter of 2024 to negative 67.9% in the third quarter of 2025. PLUG also reported a gross loss of $120 million in the quarter, up 20% on a year-over-year basis. High equipment costs and rising fuel delivery expenses continued to hurt profitability.
Also, Plug Power incurred more than $97 million in impairment charges during the third quarter. This included reductions in the value of property, plant and equipment, prepaid capital expenses, contract assets, right-of-use assets and equipment tied to power purchase agreements. These write-downs occurred because it is dealing with project execution challenges, customer disputes and changes in its site and real estate plans, all of which forced Plug Power to lower the value of several assets and added further pressure to its financial results.
Despite the adversities, the company remains committed to long-term recovery. By lowering input costs, tightening spending and expanding electrolyzer capacity and hydrogen plant development, Plug Power aims to improve its margin trajectory.
Margin Performance of PLUG’s Peers
Among PLUG’s major peers, Bloom Energy Corp.’s (BE - Free Report) cost of revenues surged 46% year over year in the third quarter of 2025. However, Bloom Energy’s gross profit rose 92.6% year over year. Bloom Energy’s gross margin expanded 540 basis points to 29.2%, driven by productivity gains, higher volumes and favorable pricing.
Plug Power’s another peer, Flux Power Holdings, Inc.’s (FLUX - Free Report) total cost of sales was $9.41 million, down 13.7% year over year in the fiscal first quarter of 2026 (ended September 2025). However, Flux Power’s gross profit declined 27.8% year over year. Flux Power’s gross margin decreased 380 basis points, due to lower average selling prices.
The Zacks Rundown for PLUG
Shares of Plug Power have gained 1.4% in the year-to-date period compared with the industry’s growth of 35%.
Image Source: Zacks Investment Research
From a valuation standpoint, Plug Power is trading at a forward price-to-earnings ratio of a negative 5.99X against the industry average of 25.01X. PLUG carries a Value Score of F.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for PLUG’s bottom line has decreased in the past 60 days.
Image Source: Zacks Investment Research
The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.