Nel ASA's Order Book Swells 34% While Group Revenue Shrinks 63%: Can PEM Carry the Turnaround?

Nel ASA closed the third quarter of 2026 with a backlog of NOK 1,314 million and an order intake that had jumped 339% to NOK 253 million — figures that point to a far stronger demand pipeline than the company is currently converting into billings. Revenue from customer contracts, by contrast, fell 63% year on year to NOK 112 million. The gap between what Nel is winning and what it is invoicing is the central tension running through the quarterly report published on Thursday.

That divergence matters because a rising backlog speaks to future business, not present earnings. For the investment case to hold, Nel must translate those orders into revenue and, ultimately, into a smaller loss. Neither has happened yet.

PEM Grows, Alkaline Collapses

The group-level revenue decline masks sharply divergent trends inside the business. PEM revenue climbed 65% in the third quarter to NOK 89 million, giving Nel at least one division with expanding billings. Alkaline, by contrast, contracted 91% to NOK 23 million — a drop far too large for PEM's advance to offset.

That asymmetry defines the risk. Even if PEM keeps growing, continued weakness in Alkaline could swamp the improvement and delay any group-wide recovery. A turnaround in one segment is not a turnaround for the company.

Profitability remains under pressure. Nel reported EBITDA of NOK -93 million for the quarter, compared with NOK -37 million in the same period a year earlier, and a net loss of NOK -141 million. Cash and liquid resources stood at NOK 1,078 million at quarter-end — a cushion that supports the balance sheet but does nothing to fix the operating result. The cash position alone cannot establish a timeline for an earnings recovery, nor does it guarantee financing security indefinitely.

A Concrete US Order With a 2027 Horizon

The clearest evidence of demand came roughly a week before the quarterly release, when Nel Hydrogen US booked an order from an unnamed global technology group headquartered in the United States. The contract covers several containerised PEM electrolysers from the MC series, along with associated services, and carries a value of approximately USD 12 million. Delivery is expected in 2027.

Unlike a letter of intent, this is a firm commitment with defined equipment, services and a delivery window. It demonstrates that demand for Nel's technology is real. What it does not do is alter the current P&L — the revenue lands in the future, and the order is proof of appetite rather than of an earnings improvement already achieved.

Rheinmetall: An Option, Not an Order

A second announcement from around the same time carries a very different weight. Nel and Rheinmetall signed a declaration of intent to explore decentralised, renewable production of synthetic fuels for defence and critical infrastructure applications. The agreement is non-binding; any next steps depend on mutual agreement and the outcome of ongoing reviews.

Treating that memorandum as equivalent to the US electrolyser contract would misread it. One is a booked order with a delivery date; the other opens the door to a possible collaboration that may or may not materialise.

What Investors Should Watch

The framework for assessing Nel therefore has a clear hierarchy. Reported revenue and earnings describe where the company stands today. Firm orders underpin the outlook. The Rheinmetall declaration represents, for now, only optionality.

The next real test is the expected delivery of the US order in 2027, which should show how the recent surge in PEM demand converts into actual business. Even that shipment, on its own, would not prove a group-wide earnings turnaround — it would be one data point in a longer execution story.

Nel has won more orders. Whether those orders become revenue and narrow the losses is the question that will decide how much confidence the backlog ultimately deserves. Until that conversion shows up in the numbers, the stronger intake strengthens the case for the future without settling the case for the present.