Nel ASA’s Two-Speed Story: Orders Accelerate While the P&L Keeps Bleeding

The Norwegian electrolyser maker Nel ASA is living a split-screen reality. Its order intake just exploded by 224 percent year-on-year, yet the income statement tells a far more somber tale — and Wall Street is recalibrating its expectations accordingly.

JPMorgan has slashed its price target on the Oslo-listed hydrogen specialist from NOK 2.90 to NOK 1.80, a roughly 38 percent haircut that underscores growing doubts about the company’s path to profitability. The bank maintains its “Neutral” rating, but the magnitude of the cut speaks volumes about how the investment case has shifted since spring.

The Q2 Numbers: A Study in Contradictions

Nel’s second-quarter 2026 results laid the tension bare. Customer contract revenue came in at NOK 153 million, down 12 percent from the same period last year. The order intake, by contrast, surged to NOK 230 million — a 224 percent jump — with the PEM segment accounting for roughly 96 percent of that total, or NOK 221 million.

The gap between bookings and billed revenue is precisely what has the market on edge. A backlog of NOK 1.213 billion at the end of June offers forward visibility, but converting those orders into recognized revenue remains the critical challenge.

The bottom line was equally sobering. Nel posted a net loss of NOK 189 million, widening from a NOK 131 million deficit in Q2 2025. The operating loss reached NOK 205 million, which management cited as the primary driver behind the expanded net loss. EBITDA came in at minus NOK 155 million, though a NOK 70 million settlement payment to Iwatani Corporation of America — agreed in early June — weighed on the figure. Excluding that one-off, adjusted EBITDA would have been flat year-on-year.

Segment performance was mixed. The PEM division generated NOK 97 million in revenue, up 31 percent sequentially but down 10 percent from a year earlier. The alkaline electrolyser segment saw revenue fall 14 percent year-on-year, though its EBITDA remained broadly stable.

Leadership Uncertainty Compounds the Pressure

Adding to the operational strain is a vacuum at the top. CEO Håkon Volldal announced in June he would depart for a packaging company, leaving long-term investors to grapple with leadership uncertainty at a pivotal moment. The timing could hardly be worse: the company is trying to commercialize a new platform, scale manufacturing, and reassure markets about its cash runway all at once.

Should investors sell immediately? Or is it worth buying Nel ASA?

That runway, at least, remains intact. Liquidity stood at NOK 1.3 billion at quarter-end, down from NOK 1.4 billion in Q1 — a buffer that buys time without forcing immediate financing decisions. The market capitalization sits at roughly EUR 359.81 million.

The PA-Series Bet

Nel’s medium-term strategy hinges on the PA-Series, a pressurized alkaline electrolyser platform launched commercially in May. The company claims the new system requires 80 percent less floor space and carries capital costs 40 to 60 percent below those of previous generations. For a 25-megawatt installation, Nel estimates full costs of under USD 1,450 per kilowatt.

Management expects initial orders for the platform in the coming months. Supporting that ambition is a EUR 135 million grant from the EU Innovation Fund earmarked for the PA-Series production line. The company is also scaling capacity: 500 megawatts by the end of 2026, with a gigawatt target for 2027.

Brussels Could Provide the Next Catalyst

The broader industry is watching Brussels closely. Early August will bring the announcement of winners under the “HORIZON-JU-CLEANH2-2026” funding program, with roughly 170 green hydrogen projects vying for support. Should Nel or its partner projects secure funding, the backlog could get fresh momentum.

Chart Position: Stabilizing, Not Recovering

The technical picture remains fragile. The stock trades 10.05 percent below its 50-day moving average of EUR 0.2210 and well under the 200-day average. The 14-day RSI sits at 43.5 — weak, but not yet in oversold territory. The shares are 45.61 percent off their 52-week high from late May, though they remain 15.08 percent above the February low of NOK 0.1731.

On Friday, the stock changed hands around EUR 0.1988–0.1992, up roughly 1.3–1.5 percent on the day as it clawed back a small slice of the previous session’s losses. Year-to-date, the shares are still up about 5.30 percent.

The next major test arrives on October 21, 2026, when Nel reports third-quarter figures. By then, investors will have a clearer read on two things: whether the EU decision out of Brussels adds to the order book, and whether the PA-Series can convert its promise into actual purchase orders. Until then, the market’s verdict seems to be: the pipeline is filling, but the proof will be in the revenue recognition.