What happened
Plug Power (PLUG 1.26%) reported record revenue in its second-quarter results on Wednesday, but the stock was tanking anyway Thursday morning. After dropping more than 15%, Plug shares were trading lower by 13.2% as of 10:55 a.m. ET.
So what
The hydrogen production and fuel cell company generated $260 million in revenue in the second quarter, representing a 72% increase versus the prior-year period. Plug also reaffirmed its full-year sales estimate.
That's good news for the upstart clean energy company as sales increased from legacy fuel cell customers as well as growth areas including cryogenics and liquefaction. But investors were more focused on what the company said about the hydrogen production facilities the company has invested billions to build across the country.
Now what
Plug has hydrogen production plants starting operations or under construction in states including New York, Georgia, Tennessee, Louisiana, and Texas as well as on the West Coast. The company plans to use this network of green hydrogen producers to supply lower-cost hydrogen to users in the transportation and industrial sectors.
But management said unplanned maintenance downtime and weather-related construction delays have pushed back the timeline for these plants to reach full production. In the meantime, elevated hydrogen prices from third-party suppliers on the West Coast are driving costs higher.
Commissioning has begun in Georgia, but commissioning the other facilities is now scheduled to begin next year. Plug previously expected all of its facilities to be in the commissioning stage this year, attaining full production capacity by the middle of 2024. Now it seems that timeline has been pushed back by about six months.
Investors in Plug Power are counting on a blossoming hydrogen economy. The growth story has already required much patience, and some investors decided today that further delays on the road to potential profitability meant their investable funds would be better elsewhere.
