Nel ASA Reports Record Loss Amidst Surging Order Book

Nel's 2025 saw a NOK 870M Q4 loss due to impairments, but strong orders and a new EU-funded electrolyzer tech aim to cut hydrogen costs by 40-60% from 2026.

Norwegian hydrogen technology company Nel ASA has presented a complex financial picture for 2025, marked by a historic quarterly loss on one hand and one of its strongest periods for new orders on the other. The figures released in late February set the stage for 2026 to be a critical year of execution.

Strategic Investment and Cost Focus

A key strategic development is the company's investment decision to expand its Herøya facility. In mid-December, the board approved the industrialization of its "Next Generation Pressurized Alkaline" platform, following the successful full-scale prototype testing. This project is slated to receive up to €135 million from the EU Innovation Fund, covering approximately 60% of eligible costs.

For the initial 1 GW phase, Nel estimates pre-funding investments at around NOK 300 million, to be spread across 2026 and 2027. Market launch is targeted for the first half of 2026, with larger-scale deliveries commencing from 2027. The long-term plan for the site is an annual production capacity of up to 4 GW. The company emphasizes that this new technology generation is pivotal for reducing the levelized cost of hydrogen (LCOH), claiming it can cut required space by 80%, lower capital expenditure (CAPEX) by 40–60%, and achieve an energy consumption of under 50 kWh/kg.

Revenue Decline and Project Timing

For the full year 2025, revenue fell to NOK 963 million, a 31% decrease from the NOK 1,390 million reported in 2024. Fourth-quarter revenue declined to NOK 330 million from NOK 416 million in the same period the previous year, a drop of 20%.

The company attributes these fluctuations to irregular delivery schedules for major electrolyzer projects, noting that the pace of global customer site development and readiness for handover is a decisive factor.

Segment performance was mixed. Revenue from the Alkaline Electrolyser division dropped 33% quarter-on-quarter to NOK 177 million. However, its segment EBITDA improved to NOK 36 million from NOK 19 million, bolstered by completed project deliveries and realized compensation claims. The PEM business segment saw revenue remain relatively stable at NOK 153 million, but its EBITDA loss widened to NOK -35 million from NOK -22 million. Nel cites significantly higher research and development expenses, which nearly doubled to NOK 60 million, as the primary driver. The largest order backlog also resides in the PEM segment, standing at NOK 878 million.

Impairments Weigh Heavily on Bottom Line

The most striking figure in the report is the quarterly net loss, which ballooned to NOK 870 million in Q4 2025 from NOK 64 million a year earlier. The main reason provided is total impairment charges of NOK 799 million. These writedowns primarily concern production facilities for alkaline electrolyzers at the Herøya site, as well as goodwill and intangible technology values within the PEM segment.

Consequently, the full-year net loss widened to NOK 1,265 million in 2025, compared to a loss of NOK 258 million in 2024. Liquidity stood at NOK 1.6 billion at year-end, down from NOK 1.9 billion twelve months prior.

Order Intake Provides a Silver Lining

In contrast to the weak revenue and earnings, new order intake was a standout positive. Nel reported Q4 new orders worth NOK 686 million. This represents a 364% increase from the NOK 148 million booked in the prior-year quarter and is noted as the company's second-best quarter historically.

This surge boosted the total order backlog to approximately NOK 1.3 billion, with about 70% related to PEM technology. Notable Q4 orders included PEM contracts from HyFuel and Kaupanes (Hydrogen Solutions, Norway) with a combined value exceeding $50 million. Furthermore, Nel was selected as the technology provider for GreenH projects in Kristiansund and Slagentangen and received a third order for containerized PEM solutions from H2Energy in Switzerland. Samsung E&A also appointed Nel as its preferred global hydrogen partner, with additional orders coming from HYDS and Collins Aerospace.

The central question now is how swiftly and efficiently Nel can convert this substantial backlog into recognized revenue.

Outlook and Management Commentary

Looking ahead, Nel has provided specific reporting dates: Q1 2026 results are scheduled for April 22, with the half-year report planned for July 15. The Annual General Meeting is set for April 10. Reflecting on the year, CEO Håkon Volldal described 2025 as a "demanding year" but also "a turning point in many respects."