Reporting revenue of $57.07 million, Plug Power (NASDAQ:PLUG) a leader in fuel cell solutions, beat analysts' estimate of $53.47 million. The bottom of the income statement provided another surprise, for the company reported a loss per share of $0.08, lower than the $0.10 loss that analysts were expecting.

Savvy investors know that beating analysts' estimates doesn't necessarily mean the company turned in a strong quarter, so let's take a closer look at the company's report to gain a better understanding of its progress.

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1. This record-breaking quarter is far from a shock

Investors familiar with management's early summer prediction that the second quarter would be the largest in Plug Power's history found that the company proved its prognostication to be true. Achieving a year-over-year increase in units of approximately 70%, Plug Power deployed more than 2,000 GenDrive units in the quarter to both new and recurring customers, including Amazon and Walmart.

In addition to the record-setting number of deployments, the company deserves recognition for the deal it made with DHL's subsidiary, StreetScooter, which management characterized in the letter to shareholders as the company's "first major on-road customer win." Pursuant to the deal, Plug Power will deliver 100 ProGen hydrogen fuel cell-powered trucks for on-road use to the electric vehicle manufacturer, starting in 2020.

2. The early appearance of a profit (of sorts) 

Due to the large number of deployments during the quarter, Plug Power reported Q2 gross billings (revenue before removing provisions for common stock warrants) of $58.6 million. Although it's shy of $60 million, which management identified on the conference call as the volume of gross billings where the company is break-even in its cost structure, there were some signs of progress toward profitability on the income statement. For one, the company reported an operating profit of negative $12 million, representing a negative 21% margin as it relates to gross billings. This reflects considerable improvement compared to the negative 59% margin the company generated during the same period last year.

Another indication of the company's progress is the positive adjusted EBITDA of $104,000 it reported in Q2. Earlier in the year, management had forecast Plug Power would report positive adjusted EBITDA in the third quarter, so this represents a pleasant surprise for investors, and it comes with management's continued guidance that the company would report positive adjusted EBITDA for 2019.

3. Fodder for the skeptics

While Plug Power had several things to celebrate in the quarter, the company's success in generating strong cash flow was not one of them -- albeit the company's use of $12.2 million in cash from operations was a lot closer to break even than the negative $21.2 million in operating cash flow that it reported during the same quarter last year. With this recent performance, there's significant doubt as to whether the company will make good on management's bold Q1 prediction that 2019 operational cash flow "may be somewhere between slightly negative to slightly positive, given timing on deployments and accounts receivable collections."

Through the first half of 2019, Plug Power has reported negative $48.5 million in operating cash flow; therefore, for the company to achieve management's forecast, it will have to make some dramatic improvements. How dramatic? Depends on how you define "slightly negative" -- the lower end of management's forecast. For argument's sake, let's define this as operating cash flow of negative $5 million for 2019. This means that the company will have to average positive operating cash flow of more than $22 million in quarters three and four -- a tall order considering that over the past five quarters, the company has averaged negative $16.4 million.

The electric takeaway

Between the record-setting number of deployments in the quarter and the progress toward profitability, investors can count this quarter a success. The burning question, however, is will the company succeed in building momentum and scoring similar successes in the second half of the year? Consequently, investors will want to monitor how the company progresses in achieving its 2019 gross billings forecast of about $240 million and positive adjusted EBITDA target. In addition, I'm especially curious to see what the company reports in September when it reveals its expectations for 2020 at its Plug Power Symposium.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.