Nel ASA Rides EU-Funded Alkaline Launch to 52-Week High, but Order Slump and Capacity Cuts Cloud the Horizon

Nel ASA stock hits 52-week high on commercial alkaline electrolyser launch backed by €135M EU grant, but Q1 orders plummet 73% and revenue drops 5%.

Investors pushed Nel ASA shares to a new 52-week high of €0.33 on Thursday, extending a rally that has seen the stock gain 42.57% over the past month and 50.23% year-to-date. The surge was triggered by the commercial launch of a next-generation pressurized alkaline electrolyser platform on May 6, which the company says can achieve total system costs of under $1,450 per kilowatt for 25-megawatt installations — a fraction of the roughly $3,000 per kW that some competing solutions command.

Behind the headline cost breakthrough sits a hefty subsidy from the European Union. The EU Innovation Fund has approved a grant of up to €135 million, covering around 60% of the eligible industrialization costs. Nel expects to receive an initial tranche of €11 million in the second quarter of 2026. The money will be used to ramp production at its Herøya facility in Norway, where the company aims to build an annual capacity of 500 megawatts for the new alkaline platform by the end of 2026. Longer-term plans target up to 1 gigawatt per year, with headroom to scale to 4 GW.

Q1 Orders Paint a Bleaker Picture

The technology narrative is compelling, but first-quarter numbers tell a different story. Nel generated revenue of NOK 148 million from customer contracts in the three months ended March 31, 2026, a 5% decline year-on-year. EBITDA remained negative at minus NOK 100 million, though that marked a NOK 15 million improvement over the prior year. The real shock came in the order intake, which collapsed 73% to just NOK 85 million. The order backlog consequently shrank 24% to NOK 1.113 billion.

Cash, however, remains a buffer: Nel had NOK 1.443 billion in liquid reserves at the end of March, providing a cushion for the ongoing industrialization push. Management has been trimming costs aggressively. Personnel expenses fell 21%, and headcount dropped 26% from its peak to roughly 300 employees — down 19% from the same quarter last year. The downside of those cuts, the company acknowledges, is reduced manufacturing and project-execution capacity, which could constrain the ability to respond if demand suddenly accelerates.

PEM Development and Modest Order Wins

While the alkaline platform targets large-scale mass-market projects, Nel is also advancing its proton-exchange membrane (PEM) technology as a longer-term growth driver. The company plans to build a next-generation prototype stack in 2026 and believes it can cut stack-level costs by roughly 70%. Commercial deployment remains several years away, but modular PEM systems — suited for projects between 2.5 and 50 megawatts with delivery times under 12 months — are already generating some traction. In April, Nel booked a follow-on order for containerized PEM units worth $7 million, and the first order of the second quarter came in at around NOK 70 million.

A reference project in Korea, where Nel commissioned a 10-megawatt grid-independent green hydrogen facility at the end of March, adds operational credibility. Still, the order pipeline remains thin, and management is counting on rising inquiries for both modular PEM and the new alkaline platform to translate into firmer bookings as the year progresses.

Technical Jitters and Geopolitical Headwinds

Despite the share price rally, technical indicators flash caution. The relative strength index stands at 27.9, and the annualized 30-day volatility has hit 93.54% — a reminder that this is a stock where expectations and commercial reality have yet to align. Geopolitical tensions in the Middle East are delaying some regional projects and causing raw-material cost fluctuations, though Nel does not see a lasting inflationary impact at this stage.

All eyes are now on the half-year report due July 15, 2026. Until then, the trajectory of order intake in the electrolyser business will be the decisive metric. New mandates would make capacity utilization beyond 2027 more tangible; without them, the technological roadmap remains larger than the commercial progress.