QuantumScape (QS +1.70%), a developer of solid-state batteries, went public through a merger with a special purpose acquisition company (SPAC) on Nov. 27, 2020. Before its market debut, it claimed it could commercialize its first batteries by 2024. It also claimed its revenue would surge from $14 million in 2024 to $275 million in 2026.
But as of this writing, QuantumScape has neither commercialized a single battery nor generated any meaningful revenue yet. That's why its stock, which opened at $24.80 on the first day, now trades at about $6. Can it finally achieve those goals this year and revive its ailing stock?
Image source: Getty Images.
Why did QuantumScape miss its original target?
QuantumScape's solid-state batteries use solid electrolytes instead of the liquid electrolytes used in conventional lithium-ion batteries. With higher charging capacities, shorter charging times, and better thermal resistance, they're well-suited for electric vehicles (EVs).
Its QSE-5 battery, which it's been co-developing with Volkswagen (OTC:VWAP.Y) for over a decade, has an energy density of 844 Wh/L (watt hours per liter) and can be charged from 10% to 80% in 12.2 minutes. Most lithium-ion batteries for EVs have a density of 300-700 Wh/L with an average charging time of 20 minutes to an hour.
NASDAQ: QS
Key Data Points
That sounds like a game changer for the EV market, but QuatnumScape's batteries are also more expensive and difficult to manufacture than their lithium-ion counterparts. A major technological hurdle is the mass production of its proprietary flexible ceramic separator, which prevents dendrites (microscopic lithium fibers) from short-circuiting the battery. In 2025, QuantumScape replaced its older Raptor separator process with its new Cobra separator process to boost its cell reliability, equipment productivity, and total yields. That move helped it ramp up its production of high-volume samples for automakers.
But it also abandoned its original goal of manufacturing its own batteries and licensed its technology to Volkswagen's PowerCo subsidiary and other automakers. So instead of operating capital-intensive manufacturing facilities, it aims to collect higher-margin royalties and licensing fees from its partners once it commercializes its first battery designs.
But when will that actually happen?
In its second-quarter report on July 22, QuantumScape said its automotive batteries wouldn't achieve commercial readiness until 2029. Therefore, investors shouldn't put any faith in Wall Street's outdated expectations for the company to start generating revenue in 2027 and 2028.
QuantumScape already has a market cap of $3.8 billion, and it will incur hundreds of millions in net losses every year until it finally launches its first commercial designs. It will remain a volatile and speculative stock, and it could easily be cut in half (or more) in the next market crash.
