Plug Power Finds a Second Wind from Amazon’s Aging Fuel Cells as Losses Narrow

Plug Power beats Q1 estimates with margins improving and Amazon fuel cell renewals starting in late 2026. Analyst upgrades push stock up 80% YTD, though cash burn and restricted liquidity pose risks.

Plug Power is counting on a replacement wave from its biggest customer to give the turnaround story a structural backbone. The first fuel cells installed at Amazon sites in 2016 are now reaching the end of their operating life, and management expects to handle roughly 10 to 12 site renewals each year starting in late 2026 — amounting to some 20,000 units over several years. Walmart renewals are also in the pipeline, and new programs with BMW, Stellantis and cable maker Southwire are adding further heft.

The strategy gained immediate credibility with first-quarter results that decisively beat analyst forecasts. Revenue hit $163.5 million, up 22% from a year ago and well above the roughly $140 million the market had penciled in. More eye-catching was the gross margin swing: from minus 55% in the prior year’s quarter to minus 13% this time around. Material-handling revenue rose about 15%, while the fuel business alone saw margins improve by more than 50 percentage points, aided by better network efficiency and a third-party gas supply agreement. The company’s Project Quantum Leap cost-cutting program drove service expenses per GenDrive unit down 30% year over year.

The numbers unleashed a flurry of analyst upgrades. B. Riley Securities and Craig-Hallum both set a $5 price target with buy ratings. Canaccord Genuity lifted its target to $4 from $2.50 but kept a hold, and Susquehanna increased to $3.75 from $2.75, with analyst Charles Minervino explicitly citing the cost-reduction progress. The consensus average target stands at $3.13 with a hold rating. Shares surged more than 11% on Wednesday to close at $3.98 in New York after touching intraday gains of 15%. The stock has climbed roughly 80% year to date and now trades about 70% above its 200-day moving average. In Frankfurt, the listing changed hands at €3.41.

The electrolyzer business provided an additional growth engine. Segment revenue catapulted to $40.8 million from $9.2 million a year earlier. Major projects include a 25-megawatt deal with Iberdrola and BP in Spain and a 100-megawatt venture with Galp in Portugal. The total project pipeline has swelled to more than $8 billion. The reintroduction of the US investment tax credit earlier in 2026 has also improved the economics of hydrogen solutions for many customers, according to the company.

Yet the balance sheet still demands careful watching. Plug Power ended the quarter with $802 million in cash, but only $223 million of that was freely available; the rest is restricted. The company plans to unlock liquidity through asset monetizations worth roughly $275 million. The first tranche of $142 million, from a deal with Stream Data Centers, is expected to land in June 2026. A $39.2 million tax credit tied to the St. Gabriel facility is due by the end of May. Still, the business burned about $150 million in operating cash during the first quarter, and the cumulative deficit sits at $8.2 billion. Any delays in monetizations or tax credit sales could put pressure on 2026 funding.

The profitability roadmap remains unchanged from earlier guidance. CEO Jose Luis Crespo reaffirmed the target of positive EBITDAS in the fourth quarter of 2026, followed by positive operating profit in 2027 and full profitability in 2028. Hitting those milestones will depend on whether the margin gains hold pace and the fleet renewal cycle delivers incremental revenue fast enough.

The June closing of the Stream Data Centers deal will be the first concrete test of whether Plug Power can convert its operational momentum into a more stable financial footing.