Will Softening Equipment Demand Limit Plug Power's Growth Potential?

Plug Power Inc. PLUG is plagued by lower demand across several of its core product categories, which is adding pressure to its performance. In the third quarter of 2025, revenues from equipment, related infrastructure and other products declined 9.7% year over year to $96.8 million.

The decrease in revenues resulted from lower demand for hydrogen infrastructure, cryogenic equipment, fuel cell systems (GenDrive) and engineered oil and gas equipment. Hydrogen infrastructure revenues fell by $11.1 million due to no hydrogen site installations being completed compared with three installations in the prior-year period. Cryogenic equipment sales declined as major projects progressed more slowly toward completion, while sales of engineered oil and gas equipment, acquired through Frames, dropped by $5.7 million due to a lack of new contracts. These trends indicate that several of Plug Power’s legacy product lines are losing momentum.

However, the company’s electrolyzer product line jumped 13.2% year over year in the third quarter. Demand for PLUG’s GenEco proton exchange membrane (PEM) electrolyzers continues to rise across global industrial and energy applications, supported by favorable policies in Europe, where government funding and faster permitting are helping accelerate green hydrogen deployment. If maintained, this strength could partially counter the weakness in PLUG’s legacy product categories and play a meaningful role in balancing its overall performance.

Snapshot of Plug Power’s Peers

Among its major peers, Bloom Energy Corp.’s BE product and service revenues rose 55.7% year over year in the third quarter of 2025. Bloom Energy’s total revenues surged 57.1% year over year in the same period. The growth was fueled by robust demand for Bloom Energy’s solid oxide fuel cell systems and expanding adoption of hydrogen-capable solutions.

Another PLUG peer, Flux Power Holdings, Inc. FLUX reported revenues of $13.2 million in the first quarter of fiscal 2026 (ended September 2025). Flux Power’s total revenues decreased 18% year over year in the same period, owing to the lower capital spending. However, Flux Power continues to expand its lithium-ion energy storage solutions and SkyEMS software platform.

The Zacks Rundown for PLUG

Shares of Plug Power have gained 28.8% in the past three months compared with the industry’s growth of 14.7%.

From a valuation standpoint, Plug Power is trading at a forward price-to-earnings ratio of negative 5.26X against the industry average of 21.68X. PLUG carries a Value Score of F.

The Zacks Consensus Estimate for PLUG’s bottom line for fourth-quarter 2025 has declined a penny in the past 60 days.

The company currently carries a Zacks Rank #3 (Hold). 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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