Nel ASA Narrows First-Quarter Loss as Cost Cuts Take Effect, but Order Backlog Shrinks by 24%

Nel ASA posted a net loss of NOK 144 million in the first quarter of 2026, an improvement from the NOK 179 million loss recorded a year earlier, as aggressive cost-cutting measures began to bear fruit. The Norwegian electrolyser manufacturer reduced personnel expenses by 21 percent through a workforce reduction of between 19 and 26 percent, helping to offset a decline in revenue.

Revenue from customer contracts slipped five percent to NOK 148 million, while EBITDA improved by NOK 15 million to minus NOK 100 million. The performance was uneven across divisions: the alkaline segment posted a six percent revenue gain and boosted its EBITDA by NOK 35 million, while the PEM division saw revenues fall 14 percent, dragged down by smaller kW-scale electrolyser sales.

Order book under pressure despite post-quarter US win

The more worrying metric for investors is the order backlog, which stood at NOK 1.113 billion at the end of March — a 24 percent drop from the same period in 2025. New orders booked during the quarter totalled just NOK 85 million, with 78 percent coming from the PEM segment.

There was a bright spot after the quarter closed: Nel Hydrogen US, the company’s American subsidiary, secured a PEM electrolyser purchase order worth approximately $7 million. The units will be manufactured at the Wallingford, Connecticut facility and are scheduled to enter service in the first half of 2027.

CEO Håkon Volldal acknowledged the slow start to the year but expressed confidence that additional contracts would materialise before the end of the first half.

Cash position holds steady as EU funding looms

Nel ended the quarter with roughly NOK 1.44 billion in cash — a solid cushion, though down from more than NOK 2 billion a year ago. The company also expects to receive an EU grant of €11 million in the second quarter, providing an additional liquidity boost.

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The cash burn reflects the ongoing restructuring and strategic repositioning of the business, which has yet to translate into sustained profitability.

New alkaline platform set for May launch

The most significant catalyst on the horizon is the planned May 2026 launch of a new generation of pressurised alkaline electrolysers. Nel says the platform will reduce capital expenditure by 40 to 60 percent and operating costs by 10 to 20 percent compared with current technology. If the claims hold up in commercial deployment, it could give the company a meaningful edge in a market where cost efficiency increasingly determines which projects reach final investment decisions.

Volldal has also flagged growing interest from the defence and energy security sectors, arguing that decentralised, flexible hydrogen production is gaining attention for military applications. “I don’t think it’s controversial to say that we need to reconsider our energy system,” he said.

Market response muted as shares hover near year-highs

The Nel share traded at €0.22 in Frankfurt, having recovered roughly 15 percent year-to-date but remaining nearly 11 percent below its 52-week high of €0.25. The stock sits about 23 percent above its March low. Berenberg trimmed its price target to NOK 2.30 in March, reflecting caution over the weak order intake.

The next major data point comes on 15 July 2026, when Nel publishes its half-year results. By then, the market will have a clearer picture of whether the alkaline platform launch can reverse the decline in the order book and attract the new contracts the company desperately needs.