The gap between Nel ASA’s order book and the production capacity it is busy building has become the single most important metric for investors trying to gauge whether the Norwegian hydrogen specialist can finally convert a chronically loss-making division into a profitable business. At its current share price of around 0.1988 euro, the stock sits roughly 46 percent below the May high of 0.3655 euro — and the path from here depends almost entirely on whether incoming orders can fill the factories Nel is spending heavily to construct.
A New Platform Carries Heavy Expectations
Nel officially launched its PA-Series, a new pressurized alkaline electrolyser platform, on May 6. Early trials with partners and customers have been encouraging, and management has set ambitious production targets: 500 megawatts of manufacturing capacity by the end of 2026, scaling to one gigawatt by 2027. The European Union is backing the expansion of the PA-Series line with 135 million euros in support.
The company claims the new platform cuts capital costs by 40 to 60 percent and shrinks the physical footprint of installations by up to 80 percent. Production capacity is being expanded at the Herøya site in Norway. But the technology’s commercial promise remains unproven at scale — the transition from prototype to series production is still a work in progress, not a completed milestone.
The Numbers Behind the Narrative
The second quarter of 2026 delivered a mixed picture that has fueled both bullish and bearish readings of the stock. Total order intake jumped to 230 million Norwegian kroner — a 171 percent increase quarter-over-quarter and a 224 percent jump year-over-year. PEM products accounted for 96 percent of those new orders. Management described the momentum as “encouraging commercial dynamism,” pointing to two significant purchase orders and the successful PA-Series launch.
The order backlog stood at roughly 1.2 billion Norwegian kroner at the end of the second quarter, up nine percent from the previous quarter but down three percent from a year earlier. The secondary source characterizes this as a record level, though the primary source notes it remains below the prior-year figure. Either way, the backlog still falls short of the volumes Nel says it needs to reach profitability: several hundred megawatts of alkaline volume annually, plus a PEM utilization rate of 20 to 24 percent.
Revenue from customer contracts, however, tells a less flattering story. Second-quarter revenue fell 12 percent year-over-year to 153 million Norwegian kroner. The operating loss came in at 205 million kroner, with a net loss of 189 million kroner. The EBITDA figure of negative 155 million kroner includes a one-time charge of 70 million kroner related to the settlement of a legal dispute with Iwatani Corporation of America. Strip that out, and the underlying operating result moves meaningfully closer to breakeven — though still far from it.
Should investors sell immediately? Or is it worth buying Nel ASA?
A Leadership Vacancy Adds Uncertainty
Complicating the financial picture is a change at the top. CEO Håkon Volldal announced his resignation in June 2026, with a move to packaging company Elopak scheduled for January 2027. He remains in his role until a successor is found, but the search adds a layer of strategic uncertainty at a critical juncture.
Whoever takes over inherits a company with a full order book but a persistent gap between booked volumes and the utilization thresholds management has identified as necessary for sustainable profitability. The task is to convert that backlog into reliable revenue growth — without the kind of one-off charges that distorted the most recent quarter.
Two Scenarios, One Decisive Variable
The bull case rests on momentum. The second-quarter order intake surge, the successful platform launch, and a comfortable cash position of 1.328 billion Norwegian kroner give Nel time to finance its capacity build-out without tapping equity markets. If the order trend continues and the PA-Series lands its first large contracts, the current share price — nearly 16 percent below its 50-day moving average — could close that gap.
The bear case is equally straightforward. Revenue is shrinking, structural losses persist, and the fixed-cost burden of capacity expansion will weigh on margins if new orders fail to keep pace with the planned 500 megawatts and eventual gigawatt of manufacturing capacity. The stock already trades about seven percent below its 200-day average, and the path to the year’s low of 0.1731 euro is not far. The first quarter of 2026 offered a cautionary tale: order intake collapsed and the backlog shrank sharply, demonstrating how quickly the picture can deteriorate.
What to Watch Next
The annualized 30-day volatility of nearly 30 percent suggests the market is already pricing in this uncertainty. The next concrete test arrives with the third-quarter report, expected in the fourth quarter of 2026. That will show whether PA-Series orders are translating into a backlog large enough to approach management’s stated utilization thresholds — or whether the mismatch between installed capacity and booked volume continues to widen, putting additional pressure on a stock that has already given back nearly half its value this year.
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