Why Plug Power Stock Tumbled 30% in the First Half of 2025

Key Points

• Plug Power signed some big deals in the first half of 2025.

• Its sales and margins, however, remain under pressure and cash burn continues.

• 10 stocks we like better than Plug Power ›

Investors in Plug Power (NASDAQ: PLUG) were staring at massive losses as the hydrogen stock plummeted 59% in the first five months of 2025. In June, however, Plug Power made a dramatic U-turn and shot up 69% in the month.

However, that still means Plug Power stock ended the first half of 2025 down 30%, according to data provided by S&P Global Market Intelligence. But the question is: Does the stock's recent rally signal a long-awaited turnaround?

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Image source: Getty Images.

Plug Power's tumultuous 2025

Plug Power's fortunes appeared to be turning at one point in early 2025. The hydrogen producer and fuel-cell maker bagged a huge 3 gigawatt (GW) electrolyzer supply deal with Australia's Allied Green Ammonia. At the same time, it secured a $1.66 billion loan guarantee from the Department of Energy earlier this year. That's a big sum of money for a company facing a severe cash crunch that even cast doubts on its ability to remain a going concern.

The euphoria, however, was short-lived. On his first day in office, President Donald Trump issued an executive order halting the release of federal funding worth billions of dollars for green hydrogen projects previously approved by the Biden administration. That also put Plug Power's loan at risk, compelling the company to initiate several cost-cutting moves in the following weeks.

Meanwhile, Plug Power's revenue nearly halved in 2024, and it reported a negative gross margin of 78% and a staggering net loss of $2.1 billion for the year.

However, Plug Power's notably stronger first-quarter numbers caught investors' attention, and that's when the stock started to reverse course. Its sales grew 11% year over year, gross loss more than halved, and rate of cash burn fell.

June turned out to be a monumental month as Plug Power stock bagged another 2 GW deal from Allied Green as CFO Paul Middleton purchased shares in the company, signaling his conviction in Plug Power's prospects. The hydrogen stock zoomed over 65% in June and has managed to stay in the green so far this month.

Is it time to buy Plug Power stock?

Amid all its challenges, the one notable thing about Plug Power is how it continues to win deals. In early July, it signed a contract with an unnamed U.S. industrial gas company, this time to purchase liquid hydrogen through 2030. Although Plug Power is expanding its own hydrogen production capacity, it continues to rely heavily on outside purchases. Plug Power expects this deal to reduce its costs "significantly" and boost cash flows.

This hydrogen deal comes close on the heels of Trump signing the One Big Beautiful Bill Act into law on July 4. Although the new law rolls back several core incentives the green hydrogen industry previously relied on, it proposes to phase out tax credits on projects starting only after Dec. 31, 2027. The earlier iterations of the bill proposed to ax tax credits by the end of this year.

I see promise in Plug Power's latest hydrogen deal since it should help it cut costs. However, I'd still stay on the sidelines until Plug Power's revenue, margins, and cash flows confirm an uptrend. It's anyone's guess when that will be. Plug Power stock will likely remain highly volatile in between, with high odds of a delisting.

Should you invest $1,000 in Plug Power right now?

Before you buy stock in Plug Power, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Plug Power wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $679,653!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,046,308!*

Now, it’s worth noting Stock Advisor’s total average return is 1,060% — a market-crushing outperformance compared to 179% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 15, 2025

Neha Chamaria has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.