On July 26, or next Wednesday, QuantumScape (NYSE:QS) will report its second-quarter earnings after the market close. The pre-revenue solid-state battery (SSB) company has enjoyed a generous year, with its shares up more than 70% year-to-date (YTD). At the same time, QS stock carries a short interest as a percentage of float of 22.72% as of June 30, up by 6.19% compared to the previous reading. That’s equivalent to 61.58 million shares of QS sold short, meaning that a better-than-expected earnings report could possibly influence short sellers to cover their positions.
During QuantumScape’s last earnings, it revealed that it had successfully completed testing of its 24-layer A0 prototype cells with one automotive customer. The company also disclosed that it had successfully completed testing of its zero externally applied pressure single-layer prototype cells. Both tests showed that the cells evidenced less than 1% capacity loss per 100 cycles.
QS Stock: QuantumScape to Report Earnings on July 26
Analysts have forecast $0 in revenue and an adjusted loss per share of 19 cents for QuantumScape’s second quarter. During Q1, the company reported $0 in revenue and a loss per share of 24 cents. Meanwhile, adjusted net income is expected to be a loss of $100 million, improving from a loss of $105 million quarter-over-quarter (QOQ).
QuantumScape is expected to be an unprofitable company for the next few years. Based on analyst estimates from Koyfin, the firm is expected to report a GAAP loss per share all the way out until Q4 of 2025, which is the quarter of the farthest estimate. However, it’s also expected to report $3 million of revenue — its first-ever revenue — during Q1 2024. Revenue for each quarter of 2024 is forecast to be $3 million per quarter. By 2025, analysts have forecasted $54 million of revenue for the entire year.
Ultimately, an investment in QS stock is an investment in the idea that the company can create an efficient SSB. QuantumScape’s future revenue will also be dependent on the prevalence of electric vehicles (EVs) and whether EV companies will want to use the firm’s battery. That said, QuantumScape isn’t the only company looking to create a dependent SSB, so competition will be a major risk as well.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
