Nel ASA's Financial Paradox: Record Losses Amid Unprecedented Order Surge

Nel's Q4 2025 shows a paradox: record quarterly loss of 870M NOK and a 364% order intake surge, highlighting the green hydrogen sector's growing pains.

Norwegian hydrogen technology leader Nel ASA unveiled its financial results for the fourth quarter and full year 2025 on February 26, 2026, presenting a stark financial dichotomy. The company reported its largest quarterly loss ever, even as it secured one of the strongest order intakes in its history—a contradiction emblematic of the current state of the green hydrogen sector.

A Surge in New Business

The most striking positive signal came from new orders. During Q4 2025, Nel secured contracts worth 686 million NOK, representing a staggering 364% increase compared to the 148 million NOK booked in the same period a year prior. This performance marked the second-best quarter for order intake in the company's record books.

The PEM (Proton Exchange Membrane) electrolyzer division was the primary driver, contributing 93% of the new orders. Major contracts included those for the HyFuel and Kaupanes projects from Hydrogen Solutions AS (HYDS), which together represent over 40 megawatts of capacity and are valued at more than 50 million USD. Furthermore, Nel was appointed the preferred global hydrogen partner for Samsung E&A, with additional orders coming from HYDS and Collins Aerospace. Consequently, the total order backlog climbed to 1,319 million NOK by quarter's end, a 34% increase from Q3 2025.

Revenue Decline and Strategic Shift Costs

In stark contrast to the booming order book, revenue experienced a significant contraction. For the full year 2025, revenue fell 31% to 963 million NOK, down from 1,390 million NOK in 2024. In the fourth quarter alone, revenue declined by 20% to 330 million NOK. This volatility is attributed to the irregular delivery schedules of large-scale electrolyzer projects, which depend on the development progress of customer sites globally.

The bottom line was severely impacted by substantial non-cash impairment charges totaling 799 million NOK. These included 361 million NOK related to production assets for atmospheric alkaline electrolysis and 439 million NOK tied to goodwill and intangible technology values. These write-downs reflect a strategic pivot away from the first-generation alkaline technology toward the company's next-generation platform. As a result, the net loss for Q4 ballooned to 870 million NOK, compared to a loss of 64 million NOK in Q4 2024. The full-year EBITDA loss widened to -275 million NOK from -173 million NOK in the prior year.

Diverging Segment Performance

The company's two main business segments showed divergent trends. Revenue from the Alkaline segment dropped 33% in the quarter to 177 million NOK. However, its segment EBITDA improved to 36 million NOK, up from 19 million NOK a year earlier, supported by completed project deliveries and realized compensation claims.

The PEM segment maintained stable revenue of 153 million NOK. Its EBITDA loss, however, deepened to -35 million NOK from -22 million NOK, as research and development expenses nearly doubled to 60 million NOK. This division holds the largest portion of the order backlog, amounting to 878 million NOK.

Investing in the Future: The Herøya Expansion

Looking forward, a key strategic milestone was reached in December 2025 when Nel's board approved the industrialization of its "Next Generation Pressurized Alkaline" platform at the Herøya facility. This technology, in development since 2018, has successfully completed its prototype phase.

The first phase of expansion, aiming for one gigawatt of capacity, will require an investment of approximately 300 million NOK before deducting public grants. The project is backed by the EU Innovation Fund with support of up to 135 million euros, covering about 60% of the eligible costs. Nel's long-term plan for the site is an annual production capacity of up to four gigawatts. Market launch is scheduled for the first half of 2026, with larger-scale deliveries expected from 2027 onward.

Financial Position and Outlook

Nel ended the fourth quarter with a solid liquidity position of approximately 1.6 billion NOK in cash and equivalents. This represents a decrease from the 1.9 billion NOK held at the end of 2024, as the company continues to invest heavily in its next-generation technology platform. Operational efficiency measures included a 12% reduction in personnel costs to 569 million NOK, with the workforce shrinking from 430 to 346 full-time employees.

The 2025 results underscore the transitional phase of the hydrogen industry. While operational revenues are under pressure and strategic write-downs weigh on profitability, the explosive growth in new orders points to a potential inflection point. The critical test will be the speed at which Nel can convert its robust order backlog into sustained revenue.

Investors will get their next update when Q1 2026 figures are released on April 22, 2026. The company's annual general meeting is scheduled for April 10, 2026.