Nel ASA Reports Mixed Quarter as Impairments Weigh on Profits

Nel's Q4 2025 shows a 364% surge in orders to NOK 686M, yet revenue fell 20% and a NOK 799M impairment charge led to a net loss of NOK -870M.

Norwegian hydrogen technology company Nel ASA has released financial results for the final quarter of 2025 that present a contrasting narrative. While the order intake showed significant strength, the bottom line was severely impacted by substantial non-cash accounting charges. The core question for investors is whether the surge in new business signals a sustainable turnaround.

Order Intake Surges, Offering a Silver Lining

A standout positive from the report was a powerful rebound in new orders. During Q4 2025, Nel secured new orders worth 686 million Norwegian kroner (NOK). This represents a staggering 364% increase compared to the 148 million NOK booked in the same period last year.

Management highlighted two key contracts driving this performance:
* A major 40-megawatt PEM electrolyzer order from HYDS, valued at over $50 million and described as the largest PEM contract in the company's history.
* A follow-on order for an MC500 unit from existing customer H2 Energy in Switzerland.

Consequently, the order backlog at the quarter's close stood at 1,319 million NOK. This marks a 34% increase from the 984 million NOK reported at the end of Q3 2025, though it remains 18% below the backlog of 1,614 million NOK recorded at the end of Q4 2024.

Revenue Declines as Impairments Drive Deep Losses

The top-line figures told a less encouraging story. Revenue from customer contracts fell to 330 million NOK in Q4 2025, down 20% from 416 million NOK in the prior-year quarter. Total revenue and other income also declined to 361 million NOK from 450 million NOK.

The operational loss ballooned to -920 million NOK, a sharp deterioration from the -106 million NOK loss in Q4 2024. This was almost entirely attributable to significant impairment charges. The company reported total impairments of 799 million NOK, split between its PEM segment (439 million NOK) and its Alkaline segment (361 million NOK).

These non-cash charges flowed directly to the bottom line, resulting in a net loss of -870 million NOK for the quarter, compared to a net loss of -64 million NOK a year earlier. The pre-tax loss was -898 million NOK versus -65 million NOK in Q4 2024.

Segment Performance and Financial Position

A breakdown by business unit reveals a mixed operational picture:

• The Alkaline business reported a 33% year-over-year revenue decline but achieved a positive EBITDA of 36 million NOK, an improvement on both the previous quarter and Q4 2024. Its order backlog was 440 million NOK.
• The PEM segment maintained revenue near the prior-year level, but its EBITDA worsened to -35 million NOK from -22 million NOK in Q4 2024. Its backlog grew significantly to 878 million NOK, bolstered by the large HYDS contract.

Nel's cash position remained substantial, with cash and cash equivalents of 1,617 million NOK at the end of the quarter, down from 1,876 million NOK a year ago. Operational cash flow was negative at -10 million NOK, compared to a positive 25 million NOK in Q4 2024.

Management Outlook and Forward Calendar

In his commentary, CEO Håkon Volldal pointed to ongoing cost reduction efforts targeting capacity and operating expenses throughout 2025. He also noted progress on a next-generation pressurized alkaline technology prototype, which the company stated is performing "significantly above expectations."

The company confirmed its upcoming Annual General Meeting will be held on April 10, with Q1 2026 results scheduled for release on April 22. Market attention will now focus on whether the robust order momentum can translate into improved revenue and cash flow in the coming quarters, offsetting the one-time impact of the recent impairments.