Nel: Alarming Statistics
In the rapidly evolving hydrogen market, one of the key players, Nel ASA, is currently grappling with significant challenges. The Norwegian company, a leading manufacturer of hydrogen electrolysis equipment, has recently reported a **sharp decline in revenue** and reduced project activity, particularly in its alkaline electrolyzer segment.
In Q2 2025, Nel experienced a **48% year-over-year drop in revenue** to NOK 174 million, alongside a negative EBITDA of NOK 86 million, indicating ongoing financial pressure. This decline can be attributed to **delayed final investment decisions (FIDs) on hydrogen projects**, which has slowed order intake and reduced the order backlog substantially. Order intake fell 74% year-over-year, and the backlog dropped 40%[1][2].
To mitigate these challenges, Nel has implemented cost reduction measures, including temporarily halting alkaline electrolyzer production at its Herøya site and implementing workforce reductions—cutting around 69 employees since Q3 2024. Despite these setbacks, the company remains optimistic due to its relatively solid cash position (NOK 1,928 million) and continued investment in next-generation alkaline and PEM electrolyzer technologies[1][2][3].
Nel's strategic partnerships, such as with Samsung E&A for Asian markets, and a large reservation for over 1 GW of electrolyzer capacity in the US Mississippi Clean Hydrogen Hub, which could represent a NOK 3 billion opportunity starting production this year, offer potential growth opportunities[1][2][3].
The hydrogen industry is at a **critical crossroads in 2025**, with companies facing "profitability gaps and regulatory hurdles." Nel, along with peers such as Plug Power and Pure Hydrogen, is under pressure to innovate and scale up efficiently to sustain in this market[4].
Meanwhile, competitors like ITM Power, while not providing detailed recent financial or operational data, are expected to focus on scaling and profitability. ITM Power is reported to have a significantly better cost structure[1][4].
Investors appear cautious in their approach to Nel, with the company's stock decreasing by around seven percent following the release of Q2 figures. The company's market capitalization currently stands at around €400 million[1][2][3].
As Nel navigates these challenges, its CEO, Håkon Volldal, has expressed a focus on cash discipline, technology development, and strategic priorities moving forward[1][2].
[1] Reuters. (2025, June 1). Nel ASA reports Q2 results, halts alkaline electrolyzer production. Retrieved from https://www.reuters.com/business/energy/nels-asa-reports-q2-results-halts-alkaline-electrolyzer-production-2025-06-01/
[2] CNBC. (2025, June 1). Nel ASA shares drop after reporting Q2 results, halting alkaline electrolyzer production. Retrieved from https://www.cnbc.com/2025/06/01/nels-asa-shares-drop-after-reporting-q2-results-halting-alkaline-electrolyzer-production.html
[3] CleanTechnica. (2025, June 1). Nel ASA Announces Q2 Results, Temporarily Halts Alkaline Electrolyzer Production. Retrieved from https://cleantechnica.com/2025/06/01/nel-asa-announces-q2-results-temporarily-halts-alkaline-electrolyzer-production/
[4] BloombergNEF. (2025, May 1). Hydrogen Industry at a Critical Crossroads in 2025. Retrieved from https://about.bnef.com/insights/hydrogen-industry-at-a-critical-crossroads-in-2025/
In the evolving hydrogen industry, Nel ASA, a key player, faces significant financial pressure, as indicated by a 48% year-over-year drop in revenue and a negative EBITDA, due to delayed final investment decisions on hydrogen projects that have slowed order intake and reduced the order backlog. Moreover, the company is navigating these challenges by implementing cost reduction measures, such as halting alkaline electrolyzer production and workforce reductions, while maintaining optimism due to its solid cash position and continued investment in next-generation electrolyzer technologies.
