FuelCell Falters

When the top line is reported in megawatts, rather than dollars, you know there's probably not a lot in the earnings release to make shareholders smile.

So, it was with yesterday's news for FuelCell Energy (Nasdaq: FCEL). Revenues were down compared to last year's second quarter, dropping 21% to $7 million. Sales of fuel-cell products (as opposed to R&D contract revenue) dropped 60%. Yikes.

Also spooky was the loss of $19 million, or $0.40 per share. Though that was an improvement over the prior year's negative $0.53 per stub, analysts had expected an even smaller puddle of red. Need more bad news? The ratio of costs to revenue grew, and SG&A expenses also inflated. So far this year, the company has lost $48 million, or $0.98 per share -- way ahead of last year's $37 million.

Investors were not amused, bidding down shares by nearly 25% of their price on Tuesday.

If you were expecting high oil prices to jump-start alternative-energy providers like this one, you're out of luck so far. First off, FuelCell's energy units are for stationary applications, like powering buildings, such as the three units purchased by Starwood Hotels & Resorts Worldwide (NYSE: HOT). Thus, the company won't get the benefit of alternative-automotive dreams the way Ballard Power (Nasdaq: BLDP) might, though that stock has recently battled through a 25% haircut of its own.

Despite their admirable jobs of treading water, neither of these firms has been able to deliver on the hopes that once bid their stocks into the stratosphere. There may be a brighter future, but as we've said before, putting money into these firms is more of a speculation than an investment.

Concerned about rising fuel costs?

• See how Wal-Mart (NYSE: WMT) avoided gas pains.
• Will gas prices superchargeeBay (Nasdaq: EBAY) and Overstock (Nasdaq: OSTK)?
• How does sticker shock affect Boeing (NYSE: BA) and Costco (Nasdaq: COST)?

Fool contributor Seth Jayson digs alternative energy, but he owns no company mentioned. View his Fool profile here.