With the current volatility that's roiling the markets, it's easy to find yourself overwhelmed with the flurry of facts and figures. During times like this, in fact, it's best to remember a sage bit of advice: Keep things simple.
Electric vehicle (EV) investors with their eyes on charging infrastructure stock ChargePoint Holdings (NYSE: CHPT) should refrain from getting bogged down in excessive details. Focus, instead, on one important number that the company's management addressed in its fourth-quarter 2025 financial results presentation.
Don't let the stock's drop distract you
While the S&P 500 has dropped nearly 5% over the past year, shares of ChargePoint have plunged more than 43%. Often, stocks suffer steep declines, such as the one ChargePoint has endured, due to a company's poor performance. ChargePoint, however, actually shone in several ways last year.
In addition to expanding its fiscal 2025 gross profit margin to 24.1% from 5.9% in fiscal 2024, ChargePoint narrowed its net loss to $282.9 million in fiscal 2025, from $457.6 million in fiscal 2024.
Management projects the company powering even closer to profitability in fiscal 2026. ChargePoint's adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) margin improved in each subsequent quarter of fiscal 2025, from negative 34% in the first quarter to negative 17% in Q4. There will presumably be further improvements in the coming year. Providing scale guidance, management has identified a goal for ChargePoint to achieve positive adjusted EBITDA at some point in fiscal 2026.
While management hasn't categorically stated that the company will achieve breakeven on an adjusted EBITDA basis, investors will certainly want to remain steadfastly focused on this metric during the coming quarters to see if the company can take this stride toward overall profitability.
Is now a smart time to park this EV stock?
Management's adjusted EBITDA goal is noteworthy, but it's important to recognize that ChargePoint reported a year-over-year dip in revenue in fiscal 2025. Unless the company can make progress toward overall profitability while simultaneously growing sales, this stock is one to keep on hold.
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Scott Levine 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.
