QS vs. ENVX: Which Battery Tech Stock Is a Better Buy Now?

QuantumScape Corp. QS and Enovix Corp. ENVX are two noted players in the next-generation lithium battery race. But their approaches and end markets differ. QuantumScape is focused on developing solid-state lithium batteries for electric vehicles (EVs). Its separator technology eliminates the need for a traditional anode and its batteries promise higher energy density, faster charging and improved safety.

Enovix, meanwhile, is advancing lithium-ion batteries using 3D cell architecture, combined with a 100% silicon anode, packing more energy into smaller spaces — ideal for smartphones, AR/VR wearables, and other AI-driven devices. Its proprietary BrakeFlow feature prevents thermal runaway.

While QuantumScape has rallied roughly 200% this year, Enovix shares have risen a mere 6%. But beyond stock performance, both companies are at a pivotal juncture—QuantumScape nearing EV validation and Enovix entering large-scale production. The U.S. government’s recent push to secure domestic lithium supply bodes well for both players. Let’s assess which is a better bet now in the battery technology landscape.

The Case for QuantumScape

QuantumScape has become one of the most-watched names in the solid-state EV battery race.

In July, the company deepened its partnership with Volkswagen to accelerate the development of its QSE-5 pilot line in San Jose. Under the new agreement, Volkswagen’s battery subsidiary PowerCo will provide up to $131 million in milestone-based payments over the next two years. This adds to the $130 million already committed under a previous licensing deal, extending QuantumScape’s cash runway to about six months longer than previously expected. These milestone payments will also help narrow net losses and strengthen the company’s financial position. With $797.5 million in liquidity at the end of the second quarter of 2025 and runway now extended into 2029, QuantumScape has more room to refine and scale its technology.

Beyond Volkswagen, QuantumScape has also signed a joint development agreement with another major global automaker, reflecting industry confidence. With collaborations involving Murata Manufacturing and Corning to enhance ceramic materials, QuantumScape is steadily building a strong ecosystem.

The company’s solid-state progress was showcased at the IAA Mobility Show, where a QSE-5 cell-powered Ducati V21L motorcycle was unveiled. These cells delivered an 844 Wh/L energy density and could charge from 10% to 80% in just 12 minutes.

On the manufacturing front, QuantumScape’s new COBRA process boosts productivity by 25x over its previous Raptor system, marking a huge leap toward scalability. The company is now preparing B1 samples for real-world testing in 2026, a crucial milestone toward production readiness.

Although QuantumScape is still pre-revenues, the combination of technological progress, extended funding runway and expanding partnerships positions it as a potential long-term winner if it delivers on its promise.

The Zacks Consensus Estimate for QS’ 2025 bottom line implies a year-over-year improvement of 17%.

QuantumScape Corporation Price, Consensus and EPS Surprise

QuantumScape Corporation price-consensus-eps-surprise-chart | QuantumScape Corporation Quote

The Case for Enovix

Enovix is emerging as a key player in powering the next wave of AI-driven devices like smartphones and AR/VR wearables, defense gear and IoT systems. Its proprietary AI-1 battery platform delivers over 900 Wh/L energy density, more than 1,000 cycles of life, and 3C fast charging — outperforming traditional lithium-ion batteries.

In the second quarter of 2025, Enovix shipped AI-1 samples to major smartphone OEMs, a smart eyewear company, and several industrial customers — marking its move from development to commercialization. The company’s Fab2 plant in Malaysia has already produced commercial-quality A1 cells and is ramping toward high-volume output. A second production line is also underway to meet growing demand. Enovix’s acquisition of Routejade, a South Korean battery maker, adds vertical integration in electrode coating and pack assembly — reducing costs, improving efficiency and speeding up material innovation.

CEO Raj Talluri confirmed that several OEMs are in advanced qualification stages, with smartphone integration expected to start as early as 2026. The addressable market for Enovix’s smartphone batteries exceeds $12 billion, with the top eight OEMs accounting for over 80% of shipments. Seven of these OEMs are already sampling Enovix products.  Beyond phones, Enovix is expanding into AR/VR smart eyewear, which is expected to hit tens of millions of units by 2028, and exploring opportunities in defense, IoT and EV applications. Its global footprint now spans the United States, Malaysia, South Korea, India and China, supporting scalable growth.

Financially, Enovix reported $674 million in cash at the end of the second quarter of 2025 and posted a 31% adjusted gross margin — its third straight quarter of profitability.

At scale, management expects 50%+ cash gross margins and $150 million annual revenue per production line. With a strong financial footing, robust OEM engagement and proven manufacturing progress, Enovix could be a near-term commercial success story — powering the AI hardware wave before expanding into EVs.

The Zacks Consensus Estimate for ENVX’s 2025 bottom line implies a year-over-year improvement of 21%.

Enovix Corporation Price, Consensus and EPS Surprise

Enovix Corporation price-consensus-eps-surprise-chart | Enovix Corporation Quote

Enovix Looks Better Positioned Now

Both QuantumScape and Enovix are advancing lithium battery innovation. QuantumScape’s solid-state design holds long-term promise for EVs, though commercialization is still years away. After a 200% rally so far this year courtesy several promising developments, much of the optimism already appears priced into the stock, limiting near-term upside.

Unlike QS, Enovix is generating revenues. With its 3D silicon-anode batteries moving into production and strong OEM interest, it’s well placed to benefit from rising power demands in AI-driven devices. The company was recently recognized on Fast Company’s Next Big Things in Tech list, highlighting its industry-leading innovation.

Given ENVX’s execution progress and its Zacks Rank #2 (Buy) versus QuantumScape’s Zacks Rank #3 (Hold), Enovix appears the stronger near-term bet, while QuantumScape remains a longer-term story to watch, as of now.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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