Shares of hydrogen fuel cell company Bloom Energy (NYSE:BE) are in free fall this morning, down 11.5% as of 11:45 a.m. despite the company having just reported better-than-expected revenues and a narrower GAAP loss for its fiscal second quarter of 2020.
Heading into the quarter, analysts had forecast that Bloom would report sales of no more than $171.2 million for Q2, but the actual number, although down 6% year over year, was still not as bad as expected -- $187.9 million.
Gross profit margins slipped only a bit at the renewable energy company -- down 20 basis points to 14%. But much-reduced operating expenses allowed Bloom to continue improving its numbers on the bottom line. While still unprofitable, Bloom managed to cut its GAAP loss by more than half, to just $0.34 per share.
So why are investors selling off Bloom Energy stock so hard today? For one thing, while Bloom recorded strong unit sales growth -- 13% more systems delivered to customers in Q2 2020 than in Q2 2019 -- the average selling price of the systems customers were buying was below that of the systems sold last year. This might suggest financial strain among Bloom's customers, which could crimp growth in future quarters.
Adding to investor worries, Bloom declined to give guidance on how it expects the rest of the year to play out, citing "uncertainties resulting from the global economic impact of the COVID-19 pandemic."
While an understandable reaction to an uncertain situation, Bloom's failure to reassure investors that all is well might be part of the reason those investors are moving to the sidelines today.