Nel ASA Shares Defy Weak Earnings with Strong Order Momentum

Nel's share price gained despite a Q4 loss, as a record order intake of 686M NOK signaled a potential turnaround, driven by demand for standardized electrolyzers.

Investors in hydrogen technology firm Nel ASA witnessed a counterintuitive market move following its latest earnings release. Despite presenting quarterly figures that showed declining revenue and a significant loss, the company's share price managed to close in positive territory. The catalyst for this resilience was found not in the profit and loss statement, but in a resurgent order book, signaling a potential inflection point after a prolonged slowdown.

Order Intake Sparks Investor Confidence

The primary driver behind the positive market sentiment was a robust recovery in new orders. Nel reported order intake of 686 million NOK for the fourth quarter of 2025, marking the second-best quarterly performance in the company's history. This represents a substantial reversal from the previous quarter, which had seen orders nearly evaporate.

Consequently, the total order backlog expanded to 1.3 billion NOK. This surge was supported by several key contracts, including a major order worth 50 million USD for PEM electrolyzers, alongside projects in Switzerland and Norway. The market is demonstrating a clear shift in preference toward standardized containerized solutions over complex, custom-built large-scale systems.

Non-Cash Impairments Drive Reported Loss

A closer examination of the financial results for Q4 2025 reveals the impact of significant accounting adjustments. Revenue declined by approximately 21% year-over-year to 330 million NOK. The net loss widened dramatically to 870 million NOK, compared to a loss of 64 million NOK in the prior-year period.

However, this substantial loss was predominantly attributable to non-operational factors. The company recorded special impairment charges totaling 799 million NOK. These non-cash write-downs primarily relate to older production facilities for alkaline electrolyzers and certain intangible assets. Management stated this move cleans up the balance sheet, allowing a full strategic focus on its next-generation technology platform. Excluding these items, EBITDA remained stable at -36 million NOK, consistent with the previous year's level.

Strategic Execution and Financial Positioning

Nel is leveraging its strong liquidity position, which exceeds 1.6 billion NOK, to fund a major expansion of production capacity at its Herøya plant. Investments are being channeled into the new generation of pressurized alkaline electrolyzers, with support from the EU Innovation Fund.

For shareholders, the focus now shifts to operational execution. The commercial launch of the new production line is scheduled for the first half of 2026, with industrial-scale deliveries expected to commence from 2027. The replenished order backlog provides the company with enhanced visibility and planning security to navigate this transitional phase.