What happened
Shares of fuel cell pioneer Plug Power (PLUG 2.49%) dropped Wednesday morning after the company conducted a business update webcast and made an accompanying Securities and Exchange Commission (SEC) filing that featured new projections for fiscal 2022 revenue -- and 2025 revenue as well.
As of 10 a.m. ET, Plug stock is down 2.2% (but trending higher).
Image source: Getty Images.
So what
In its update, Plug Power predicted that by the end of this year, it will be producing 70 tons per day of "green hydrogen" (that's liquid hydrogen produced from power generated by renewable energy sources). By 2025, Plug expects to grow that number to 500 tons per day. By 2028, it expects to double production to 1,000 tons per day.
In dollars and cents, Plug expects these hydrogen sales to boost its revenue to the point where, this year, total revenue will range from $900 million to $925 million. By 2025, Plug says revenue will grow to $3 billion, earning a 20% earnings before interest, taxes, depreciation, and amortization (EBITDA) profit margin.
Now what
Those are all big numbers. To put the revenue prediction in context, for example, Plug Power has produced revenue of only $31 million over the last 12 months -- so Plug's $900 million-plus prediction works out to growth by a factor of 30 times over the next 12 months.
That being said, Plug's guidance today is actually no change from the guidance it released two months ago. Investors who had presumably been hoping for yet another boost in guidance in today's announcement were therefore disappointed -- and that, in a nutshell, is why Plug Power stock is down today.
