Why ChargePoint Stock Plunged Today

Shares of electric vehicle charging company ChargePoint Holdings (NYSE: CHPT) short-circuited Thursday morning, plunging 19.8% through 10:05 a.m. ET after the company reported twice as big a loss as anticipated for its fiscal 2026 first quarter.

Heading into the company's earnings report, analysts had been forecasting that ChargePoint would report losses of $0.06 per share on more than $100 million in sales in the period, which ended April 30. In fact, ChargePoint's losses were $0.12 per share, and sales fell by 8.8% year over year to $97.6 million.

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ChargePoint's big Q1 loss

The news wasn't all bad. ChargePoint did improve its gross profit margin from 22% a year ago to 29%. Operating costs also declined, which improved operating margins.

On the bottom line, quarterly losses were the aforementioned $0.12 per share -- not great, but at least better than the $0.17 per share that ChargePoint lost a year ago. However, part of the improvement was due to ChargePoint issuing a lot of new shares, spreading its losses among 8.4% more shares outstanding. Its GAAP net loss was $57.1 million, down 20% from $71.8 million a year prior.

Is ChargePoint stock a sell?

Still and all, investors seem unhappy with the report, and at least part of the reason for that is management's guidance. ChargePoint predicts its fiscal Q2 2026 sales will land in the $90 million to $100 million range. About three-quarters of that range is less than it earned in fiscal Q1, suggesting the strong possibility that revenue will shrink sequentially. That contrasts poorly with the predictions of Wall Street analysts, whose consensus view was that ChargePoint's top line would grow respectably to more than $108 million in fiscal Q2.

It almost goes without saying that ChargePoint didn't guide investors to expect any profits in its fiscal Q2. The best the company was willing to offer on that point was that it "remains committed to its plans of achieving positive non-GAAP adjusted EBITDA during a quarter in fiscal year 2026." So, it's targeting sort of a profit in at least one quarter, but it wouldn't say which one.

That vague hope hardly seems a good reason to buy ChargePoint stock.

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Rich Smith 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.