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ChargePoint (CHPT) exceeds Q2 expectations, forecasts 100% YOY Q3 growth as EVs gain momentum

ChargePoint (CHPT), a leading EV charging provider, released its fiscal Q2 2023 earnings on Tuesday as industry expectations pick up on the heels of significant investments. The EV charging company beat forecasts as demand for electric vehicles and supporting infrastructure accelerates.

Since its foundation in 2007, ChargePoint has built an extensive EV charging network with over 200,000 locations, supporting the industry as more electric vehicles hit the streets. As automakers invest billions into creating electric models, the need for charging availability is becoming evident. More EVs on the road means more drivers will need a place to charge.

ChargePoint provides both personal and commercial EV charging options in North America and Europe, focusing on level 2 chargers. The charging solutions provider is partnered with top retailers, OEMs, gas stations, commercial properties, parking companies, fleets, residential real estate firms, and more.

Its latest partnership with Volvo and Starbucks started rolling out in Q2 with plans for a DC fast charging network from Seattle to Colorado.

ChargePoint has consistently grown alongside the EV industry, but the first quarter sparked concerns over profitability and shrinking margins.

Since then, several events are now expected to push demand for EVs even further. For one thing, the Inflation Reduction Act provides incentives for both EV buyers and charging companies.

On top of this, California says it will ban all gas-powered cars by 2035, another win for the EV industry. As ChargePoint’s Q2 earnings show, EV demand is not slowing, and charging options are more critical than ever.

Volvo charges at Starbucks with ChargePoint EV charger Source: ChargePoint

ChargePoint posts first $100 million quarter in Q2

In Q2, Chargepoint’s revenue hit a critical milestone of $108 million, its first quarter reaching over $100 million. Revenue grew 93% from last year and over 30% from the first quarter. ChargePoint’s growth is attributed to the overall growth and interest in electric vehicles.

On its Q1 earnings call, the company mentioned supply chain challenges as a reason for shrinking margins. That being said, gross margins improved by 2% from Q1, reaching 19%. Though margins are still down from a peak of 27% in fiscal Q3, the company is seeing some relief.

In addition, ChargePoint says it’s prioritizing growth, even if it means paying slightly more for materials. Pasquale Romano, ChargePoint’s CEO, has high praise for his company in Q2, saying:

ChargePoint delivered another strong quarter, with continued growth across all verticals and geographies. We continue to execute on our strategy, as demand continues to grow for our portfolio of industry-leading charging solutions for every vertical and in both North America and Europe.

Overall, ChargePoint posted a slightly larger loss of $92.7 million compared to $84.9 million in 2021. Meanwhile, the charging provider has plenty of funds, with $471.9 million in cash and equivalents.

Most importantly, ChargePoint expects its momentum to continue with 100% revenue growth in fiscal Q3, reaching between $125 and $135 million. For the full year (fiscal 2023), ChargePoint forecasts revenue of $450 to $500 million.

Electrek’s Take

You can’t deny ChargePoint’s growth at this point. Many people are talking about the company’s margins and widening losses, but the company is investing back in the business to stimulate growth.

The new climate bill and California’s ban on gasoline-powered cars are likely the start of a new trend that will only spark the EV industry further.

However, for new car buyers, charging availability is a crucial factor. SparkCharge is leading the way with over 200,000 places to charge your EV throughout North America and Europe.

The company says it’s staying engaged with leaders about the rollout of a national charging network and funds from the IRA bill. Either way, these developments should provide significant tailwinds for ChargePoint and other EV charging companies going forward.

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Avatar for Peter Johnson Peter Johnson

Peter Johnson is covering the auto industry’s step-by-step transformation to electric vehicles. He is an experienced investor, financial writer, and EV enthusiast. His enthusiasm for electric vehicles, primarily Tesla, is a significant reason he pursued a career in investments. If he isn’t telling you about his latest 10K findings, you can find him enjoying the outdoors or exercising