The latest annual report from Norwegian hydrogen specialist Nel ASA presents investors with a puzzling dichotomy. On one hand, the company recorded significant losses and declining revenue. On the other, its order intake has suddenly skyrocketed. This contrast leaves the market questioning whether this signals a long-awaited operational turnaround or if burdens from the past still weigh too heavily.
Soaring Orders Defy a Difficult Year
The most striking development is a surge in new business. During the fourth quarter, order intake exploded by 364 percent, reaching 686 million NOK. This represents the second-best quarterly performance in the company’s history. The driving force was the PEM (Proton Exchange Membrane) division, which accounted for 93 percent of the new orders. Key wins included partnerships with Samsung E&A and a major 40-megawatt order from HYDS. Consequently, the total order backlog grew to a substantial 1.32 billion NOK by year-end.
This forward-looking indicator stands in stark opposition to the historical financial results for the full 2025 fiscal year.
Revenue Decline and Substantial Losses
A review of the completed year reveals considerable challenges. Annual revenue contracted by 31 percent to 963 million NOK. The fourth quarter continued this negative trend with a 20 percent decline. The company cited industry-wide headwinds, including delays in government subsidies, rising interest rates, and increased costs for hydrogen equipment.
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The bottom line was significantly more severe. Nel posted a net loss of 870 million NOK for Q4, a drastic deterioration from the 64 million NOK loss recorded in the same period the prior year. The primary reason was nearly 800 million NOK in non-cash special depreciations. Management adjusted the value of legacy production assets and technologies as the strategic focus has now fully shifted to the next generation of products.
Strategic Pivot and Factory Overhaul in Herøya
To execute its new order book profitably, Nel is undertaking a radical production overhaul. The centerpiece is its Herøya facility, where the new “Next Generation Pressurized Alkaline” platform is being industrialized. This technology has moved beyond the prototype phase and is slated for commercial availability starting in the first half of 2026.
The company is committing significant capital to this shift, with approximately 300 million NOK allocated to the first phase of expansion. The effort has garnered support from the EU’s Innovation Fund, which is contributing up to 135 million euros. Market analysts view this strategic move as a necessary leap forward to secure technological leadership.
The Path Ahead and Liquidity Position
Nel’s liquidity position remains solid at just over 1.6 billion NOK (as of end-2025), though it has decreased compared to the previous year. The critical challenge now is to rapidly convert the swiftly grown order backlog into tangible revenue without losing control of costs. The report for the first quarter of 2026, due on April 22, 2026, will provide the next indication of whether this operational turnaround is gaining momentum.
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