FuelCell stock drops after net loss more than doubled and was wider than expected

Shares of FuelCell Energy Inc. were hit hard on Thursday after the fuel cell technology platform maker reported third-quarter tax losses that more than doubled and were bigger than expected, but revenue that exceeded forecasts.

Net losses for the quarter to July 31 widened to $30.2 million, or 8 cents per share, from $12.8 million, or 4 cents per share, in the same period a year ago.

The FactSet consensus was for a loss per share of 6 cents.

The stock fell 5.8% in morning trade to a one-month low. The title was heading for a four-week losing streak in which it lost 26.4%.

Revenue rose 60.7% to $43.1 million, well above the FactSet consensus of $35.8 million and to mark the strongest quarterly revenue in five years.

FCEL company,
-4.51%
recorded $18.0 million in product revenue, after none a year ago, to beat the FactSet consensus of $13.9 million. Services and generation revenue also beat expectations, while advanced technologies lagged.

Meanwhile, cost of revenue rose more than revenue, rising 83.8% to $47.3 million, amid higher marketing and consulting spend as the company invests in change branding and accelerated sales and marketing efforts, and higher spending on research and development.

Backlog decreased 1.1% to $1.28 billion, while unrestricted cash and cash equivalents of $456.5 million at the end of the quarter were down from compared to $489.6 million as of April 30.

The stock is down 7.6% in the past three months through Wednesday, while the S&P 500 SPX index,
+0.66%
lost 3.6%.

Ann J. Cox