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Plug Power (PLUG) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Industrials· Aug 10, 2026

Source: earnings call transcript

Executive summary

Plug Power Q2 FY26 — Raised Full-Year Revenue Guidance and Near-Breakeven Gross Margin

Plug Power delivered a strong second quarter, marked by significant margin improvement and reduced cash burn, leading to a raised full-year revenue growth outlook. The company is executing on its Quantum Leap restructuring program and asset monetization initiatives, positioning it for positive EBITDA in Q4 FY26. Management expressed high confidence in the second-half trajectory, driven by material handling growth and electrolyzer momentum.

Highlights

5

  • Revenue reached $178.3 million in Q2 FY26, up approximately 9% sequentially.

  • Gross margin improved to approximately breakeven (-0.9%) in Q2 FY26, compared to negative 30.7% a year ago and negative 13% last quarter.

  • Operating expenses declined approximately 50% year-over-year to $62 million in Q2 FY26.

  • Net cash usage improved to $61 million in Q2 FY26, a reduction of approximately 58% sequentially.

  • Full-year revenue growth guidance was raised to 15% to 16%.

Concerns

2

  • Texas data center moratorium

  • Fluidity of large project timelines

Guidance & targets

CategoryTargetConfidence
Full-year revenue growth
15% to 16%
high materiality
High
Positive EBITDA
Positive
high materiality
High
Inventory reduction
at least $100 million
medium materiality
Medium
Operating expenses run rate
roughly $75 million
medium materiality
Medium
Operating income
Positive
high materiality
Medium
Overall profitability (EPS)
Positive
high materiality
Medium

Segment performance

SegmentRevenueYoYQoQMargin
Material Handling
Material handling continues to be a strong growth driver, with significant unit deployments and service revenue growth. Improved reliability is driving service margin expansion. A substantial refresh cycle for existing units is expected over the next three years.
GenDrive units deployed: 1,666 units in Q2 FY26GenDrive units deployed growth: >100% YoY in Q2 FY26Service revenue: $29.8M in Q2 FY26Service revenue growth: 82% YoY in Q2 FY26Service margin: 27% in Q2 FY26GenDrive unit refresh opportunity: 20,000 units over 3 years for two largest customers
————
Electrolyzer Business
The electrolyzer business is gaining commercial momentum with several key project FIDs and FEED awards. European regulatory tailwinds are expected to drive significant future demand.
Barrow Green Hydrogen project FID: 30 MW for Carlton Power in the U.K.Hy2gen's Courant Project: 275 MW FEED in QuebecOrica's Hunter Valley Hydrogen Hub: 50 MW GenEco electrolyzer order in AustraliaGALP project: 100 MW in Portugal progressingIberdrola and BP project: 25 MW in Spain progressing
————
Fuel Business
The fuel business delivered strong revenue growth and significantly improved its gross margin, driven by increased plant utilization, production efficiency, and network optimization. Further progress is expected through the second half of the year.
$39.5M15%—negative 48%

Deals & partnerships

Carlton Power Final Investment Decision (FID) for Barrow Green Hydrogen project 30 MW

Part of the 55 megawatts awarded in November 2025; additional 25 MW expected to reach FID in 2026.

Hy2gen Selected for Front-End Engineering Design (FEED) on Courant Project 275 MW

FEED for the Courant Project in Quebec. Estimated FID timeline is beginning of 2027.

Orica GenEco electrolyzer order for Hunter Valley Hydrogen Hub 50 MW

Largest renewable hydrogen project to reach FID in Australia.

GALP Hydrogen project 100 MW

Project in Portugal continues progressing positively on commissioning.

Iberdrola and BP Hydrogen project 25 MW

Project in Spain continues progressing positively on commissioning.

ACCIONA Energia 50-50 Joint Venture for hydrogen projects in Spain

Developing several projects, including one in Navarra (received EUR 2.5M from European Hydrogen Bank) and one in Zaragoza (received EUR 2.85M from European Hydrogen Bank).

Stream Sale of Graham, Texas project and staged closing of New York Great Gateway $80M

Part of a program to unlock more than $275M through asset monetization and non-dilutive financing. The transaction was announced on July 13.

Risks & headwinds

Texas data center moratorium

Review of projects, not a halt

Mitigation:Company is working with Stream and will comply with government requirements to ensure projects are real and not speculative.

Fluidity of large project timelines 2027

Estimated FID timeline for Hy2gen's Courant Project is beginning of 2027, but could move to Q3.

Mitigation:Management acknowledges that with big projects, things are a little bit fluid, but expects other projects to reach FID by end of year/beginning of next year.

What to watch in Q3 FY26

Positive EBITDA

Q4 FY26
Current Negative (-0.9% gross margin in Q2 FY26)
Target Positive

Why it matters

Achieving positive EBITDA is a key milestone and turning point for the company, indicating improved profitability and operational efficiency.

We remain on track to deliver positive EBITDA in the fourth quarter, a milestone that marks a real turning point for the company.

Find out whether PLUG delivers this. Inve re-checks your case every morning.

Q&A highlights

What are the key drivers behind the improved service margins, specifically the split between improved contracting and better asset performance?

The improvement is structural, driven by increased unit reliability and stack performance, allowing technicians to cover more units and improve overhead leverage. Additionally, cautious pricing increases over the last couple of years have aligned with the cost of servicing units.

“The improvement on services really is driven by several factors. One of them is the reliability of the units is improving. The stack performance is improving. And that's leading to us being able to use less tech to actually service the units. So the overhead is also improving.”

asked by Colin Rusch · answered by Jose Crespo

2 min read 5 chapters

Detailed narrative

Quantum Leap Program Driving Margin and Cost Improvements

The company's Quantum Leap restructuring program is directly contributing to significant financial improvements. Gross margin reached near breakeven at -0.9% in Q2 FY26, a substantial improvement from -30.7% year-over-year and -13% sequentially. Operating expenses also saw a 50% year-over-year reduction to $62 million, reflecting enhanced operational discipline. These efforts are lowering the breakeven revenue threshold and putting positive EBITDA in Q4 FY26 within reach.

Material Handling Business Accelerates Growth and Recurring Revenue

The material handling segment continues to be a strong growth driver, with 1,666 GenDrive units deployed in Q2 FY26, more than double the prior year. Service revenue grew 82% year-over-year to $29.8 million, achieving a 27% service margin due to improved unit reliability and overhead leverage. A significant multi-year opportunity exists with two largest customers planning to refresh over 20,000 GenDrive units in the next three years, establishing a durable recurring revenue base.

Electrolyzer Business Gains Commercial Momentum with Key Project FIDs

Plug Power's electrolyzer business is building commercial traction, evidenced by the FID of the 30-megawatt Barrow Green Hydrogen project for Carlton Power in the U.K. and a 50-megawatt GenEco electrolyzer order for Orica's Hunter Valley Hydrogen Hub in Australia. The company was also selected for a 275-megawatt FEED on Hy2gen's Courant Project in Quebec. Existing projects with GALP in Portugal and Iberdrola/BP in Spain are progressing positively on commissioning.

European Regulatory Tailwinds Poised to Drive Significant Electrolyzer Demand

Regulatory developments in Europe, particularly the conversion of RED III into national laws, are expected to create substantial electrolyzer demand. Spain's draft framework alone could drive approximately 10 gigawatts of electrolyzer demand by 2030. Additionally, the European Commission approved a EUR 780 million Dutch subsidy scheme for 400 megawatts of electrolysis capacity and plans a EUR 500 million hydrogen auction in December 2026, providing strong tailwinds for Plug's pipeline.

Improved Liquidity and Progress on Asset Monetization

The company ended Q2 FY26 with $161.9 million in unrestricted cash and $510 million in restricted cash, totaling over $670 million. Net cash usage improved by 58% sequentially to $61 million. Plug has already received $47 million from its asset monetization program, which aims to unlock over $275 million in non-dilutive financing, with an additional $30 million to $35 million expected in the near term from the Graham, Texas project sale and New York Great Gateway closing.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.