Electric-Vehicle Charging Networks See Positive Earnings Results

Investors in electric-vehicle (EV) charging networks received good news on Wednesday with better-than-expected earnings reports from EVgo and an encouraging update from ChargePoint Holdings.

EVgo Exceeds Expectations

EVgo announced a third-quarter adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) loss of $14.2 million on sales of $35.1 million. This surpassed Wall Street's forecast of an EBITDA loss of $18.6 million on sales of approximately $30 million, as reported by FactSet.

Revised Guidance

EVgo's full-year EBITDA guidance shows a revised loss of around $64 million, an improvement from the previously projected loss of about $73 million. Additionally, the new guidance suggests a fourth-quarter EBITDA loss of about $17 million, slightly lower than the estimated $18 million loss anticipated by Wall Street analysts.

Expanding Charging Stalls

Currently, EVgo operates or has under construction approximately 3,400 charging stalls, reflecting a 31% increase compared to the previous year.

Market Response

Following these positive developments, EVgo's stock experienced an early trading boost of nearly 16%. Meanwhile, the S&P 500 and Nasdaq Composite also saw modest gains, up about 0.2%.

Shifting Sentiment in the EV Industry

The strong market response can be attributed in part to the starting point of EVgo's stock, which has declined by around 46% in the past three months. Concerns among investors regarding EV growth were reinforced by disappointing earnings from Tesla (TSLA), as well as decisions made by General Motors (GM) and Ford Motor (F) to delay certain EV-related expenditures.

EVgo Charging Network Sees Positive Results

The latest results from EVgo showcase an encouraging trend. In the third quarter, the network throughput, which represents the amount of power drawn from EVgo charging stations by electric vehicles (EVs), reached a notable 37 gigawatt-hours. This marks a significant increase from the 24.9 gigawatt-hours recorded in the previous quarter.

ChargePoint, another prominent player in the electric vehicle charging market, also shared impressive news. They announced that they have achieved one million quarterly active users - these are drivers who have been accessing ChargePoint chargers in the third quarter. While this achievement is indeed noteworthy, the news release did not provide information about year-over-year growth. We reached out to ChargePoint for comment but have not received a response at the time of writing.

At the start of the trading day, ChargePoint stock experienced an initial rise. However, as the morning progressed, these gains faded, resulting in a 1.4% decrease in share value.

When it comes to Tesla stock, which is widely regarded as an indicator of EV sentiment, there has been a slight decline of 0.5% during early trading. Although the stock has shown a 10% increase over the month and currently sits at approximately $220 per share, it remains around $30 below levels recorded just prior to the disappointing third-quarter delivery figures reported by Tesla on October 2.

Across the globe, there is growing apprehension among investors. However, recent data from PwC reveals that battery-electric vehicle (BEV) sales have accounted for around 16% of all new car sales in the United States, Europe, and China in 2023. This represents an increase from approximately 13% recorded one year ago.

Looking forward, investors are keen to gain insights into what 2024 has in store for the EV market.