KEY POINTS

  • ChargePoint is projecting that its revenue for the fiscal year will be around $500 million, which would effectively double last year’s earnings.
  • With over 200,000 charging points in North America and Europe, the company is one of the biggest electric-vehicle infrastructure providers.

What’s going on with ChargePoint stock

Electric vehicle (EV) charging network leader ChargePoint stock sunk yesterday. ChargePoint Holdings (NYSE:CHPT) shares were down 4.9% by the end of Thursday, as the market reacted to Tesla‘s (NASDAQ:TSLA) third-quarter earnings report.

Why we care

Even though Tesla’s earnings report revealed the company’s second-most profitable quarter ever, the market didn’t react positively. The firm exhibited revenue slightly below expected and admitted to being unable to reach yearly EV delivery goals. It seems that without any specific news about the company, ChargePoint’s stock is declining along with Tesla’s.

What now

Even though Tesla falls short of its 50% annual growth goal, it is still confident that it will meet the vehicle production target. The market seems unaware that this discrepancy is only coming from shipping bottlenecks delaying deliveries to customers. It’s not a demand issue because Tesla has already sold those vehicles.

ChargePoint and other EV charging network companies are expecting the demand for their services to continue growing. Competitor Blink Charging (NASDAQ:BLNK) is taking advantage of this anticipated growth by announcing plans to increase its U.S. manufacturing capacity and double its domestic workforce. Once complete, Blink’s new facility can produce AC Level 2 and Direct Current chargers in a domestic location. The firm has narrowed its potential location to Florida, Texas, Tennessee, or South Carolina.

If investors are selling ChargePoint stock today because Tesla’s deliveries were lower than expected, that would be a mistake. The more important news is that Tesla projects production to grow 50% yearly. The logistics bottlenecks will eventually be fixed and don’t reflect customer demand. ChargePoint’s fiscal quarter doesn’t end until October 31, meaning we’ll have to wait a while longer to hear an update from the company.

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