ChargePoint, the leading provider of electric vehicle (EV) charging stations in North America and Europe, recently reported a decline in revenue for the first quarter of fiscal 2026. Despite the challenging market conditions, the company’s margins have shown improvement, signaling a potential cyclical turnaround in the near future. Additionally, analysts believe that ChargePoint’s stock is currently undervalued relative to its growth potential.
In the latest earnings report released on June 4, ChargePoint posted a 9% year-over-year decrease in revenue, falling short of analysts’ expectations. However, the company was able to narrow its net loss from $71.8 million to $57.1 million, or $0.12 per share, surpassing the consensus forecast by a penny. Following the mixed earnings report, the stock saw a rally but remains down approximately 60% over the past year.
ChargePoint boasts more than 352,000 charging ports, including over 35,000 DC fast chargers, under its direct management. The company also has roaming partnerships that provide customers access to over 1.25 million charging ports globally. ChargePoint’s business model focuses on selling connected charging stations to residential and commercial properties, offering network access, billing, and customer support services to hosts.
While ChargePoint experienced rapid growth in fiscal 2022 and 2023 due to the surge in EV sales post-pandemic, its growth slowed in fiscal 2024 and 2025 as rising interest rates impacted the EV market. However, the company’s adjusted gross, operating, and EBITDA margins improved in fiscal 2025, despite the decline in revenue. This trend continued into the first quarter of fiscal 2026, indicating the company’s ability to navigate challenging market conditions.
Looking ahead, ChargePoint expects to generate $90 million to $100 million in revenue in the second quarter, representing a year-over-year decline. The company is cautious due to ongoing macroenvironment changes and tariff uncertainty. ChargePoint is also focusing on integrating its charging stalls with Eaton’s electrical grid solutions through a new partnership. While the company did not provide a full-year revenue outlook, it aims to achieve a positive adjusted EBITDA in one quarter of fiscal 2026.
Analysts anticipate flat revenue for the full year, with improved growth in the second half as the EV market stabilizes. ChargePoint’s liquidity position remains strong, with $196 million in cash and cash equivalents and no immediate debt maturities until 2028. Analysts project revenue growth of 29% in fiscal 2027 and 33% in fiscal 2028, with corresponding adjusted EBITDA improvements.
Despite its current challenges, ChargePoint presents a potential buying opportunity for investors. With an enterprise value of $465 million, the company appears undervalued based on its growth prospects. If ChargePoint meets analyst expectations and trades at a higher multiple of its forward sales, its stock price could see significant upside over the next year.
Before considering an investment in ChargePoint, investors should conduct thorough research and consider the company’s long-term prospects. While ChargePoint may not have made the list of top stocks recommended by the Motley Fool Stock Advisor team, it remains a compelling option for investors seeking exposure to the growing EV market.
In conclusion, ChargePoint’s performance in the coming months will be crucial in determining its trajectory. With a focus on improving margins and navigating market challenges, the company is well-positioned to capitalize on the evolving EV landscape.
