What happened
Shares of ChargePoint Holdings (CHPT) shot through the roof in June, gaining a whopping 42.7%, according to data provided by S&P Global Market Intelligence. The shares may have dropped nearly 9% already so far in July, but some investors only appear to be taking some profits off the table after the EV charging stock's mind-boggling rally in June.
So what
ChargePoint shares rose by double digits soon after the company reported its first-quarter earnings on June 3. It is still a growing company and is spending a lot of money on research and development, marketing, and administrative expenses, which is why it suffered a loss from operations of nearly $47 million in the first quarter.
The company was, however, profitable on a GAAP basis thanks to gains from changes in the fair value of warrants, something that special purpose acquisition companies (or SPACs) are required to account for in their income statements each quarter. As a reminder, this was ChargePoint's second earnings release since going public after completing its merger with SPAC Switchback Energy Acquisition earlier this year.
Image source: Getty Images.
Importantly, ChargePoint's revenue grew 24% year over year in the first quarter. Sales from its largest segment, networked charging systems, jumped 36% year over year. The segment accounted for 66% of total revenue. Subscriptions, which accounted for roughly 27% of revenue, saw sales rise 20%. Those numbers reflect a growing customer base for ChargePoint even as electric vehicle penetration continues to gather momentum.
In fact, ChargePoint gained a record number of customers in the quarter, taking its total customer count to above 5,000. In mid-June, it also collaborated with Mercedes-Benz to launch Mercedes me Charge, a service that will give drivers of the Mercedes EQ series seamless access to ChargePoint's EV charging network.
ChargePoint also announced new EV charging services, even calling them its most comprehensive to date. The package including fleet management software, charging solutions, design expertise, and ongoing maintenance and support -- available for all fleets regardless of type and size.
Now what
ChargePoint reiterated its guidance and expects:
- Revenue worth $46 million to $50 million in the second quarter.
- Revenue of $195 million to $205 million for the full year.
That suggests solid 37% growth at the midpoint for the full year. And with the EV charging company also ending the first quarter with a strong cash balance of $609.8 million, it's not surprising that investors consider ChargePoint to be one of the biggest potential winners from President Joe Biden's infrastructure plan.
