Needham Lowers Outlook for Charging Station Operators: Invisible Growth Dynamics in Focus

The financial services provider Needham has downgraded the rating for the two electric mobility charging station operators Blink Charging and ChargePoint from 'Buy' to 'Hold'. The reason for this is the uncertain forecast for the demand for charging infrastructure and ongoing challenges in the end market. Although the potential for long-term growth of charging stations remains due to the growing number of electric vehicles on American roads compared to installed charging infrastructure, the timing for such an upswing has become more uncertain due to the change at the top of the US government. This has reduced confidence in a stable order cycle that would be beneficial for both companies. Both companies have struggled to benefit from the rapid increase in electric vehicle usage. Although Blink achieved triple-digit sales growth in 2023, the sales forecast for 2024 remained below expectations. Recently, both Blink and ChargePoint have revised their sales forecasts downward, indicating volatile market developments. In August, Blink reduced its revenue forecast for the full year 2024 to a range of 145 to 155 million dollars, from a previous estimate of 165 to 175 million dollars. ChargePoint expects revenue of 85 to 95 million dollars for the third quarter. Plans by the upcoming US government to abolish the 7,500-dollar tax credit for electric vehicles could dampen long-term e-mobility adoption and further burden the demand for charging stations. The lack of significant federal support complicates belief in a sustainable growth cycle for charging infrastructure. Despite an increase in the proliferation of electric vehicles, charging station installations lag behind, resulting in higher usage of existing infrastructure. However, this has not yet translated into a significant increase in sales of charging devices.