After hitting first-quarter 2024 revenue targets, ChargePoint Holdings Inc. plans to slash its $49 million pre-tax loss by two-thirds by the end of Q4. The charging station manufacturer’s Q1 loss was already a 27% improvement year-over year.
Asked about whether achieving the goal was based on scaling from revenue growth or if expense cuts would be made, CEO Pasquale Romano said, “it’s actually all of the above.”
“Clearly, grow the revenue line, which we would hope to do… We expect gross margin to improve during the year; that definitely helps a lot. And then, if we are disciplined on [operating expenses] and keep that in flattish territory, you can make the math work pretty quickly,” Romano said on Thursday.
California-based ChargePoint’s operating expenses came in at $85 million, a 2% increase from last year, and representing 66% of revenue. It’s a significant decrease from previous years, as in fiscal years 2020 and 2021 it was 100% of revenue, but 69% in FY2022.
Revenue from the quarter was at the high end of last quarter’s predictions at $130 million, a 59% increase year-over-year, making it the second largest quarter in the company’s history. Most of those sales—20% of them were booked in Europe—came from network charging systems at $98 million, with $20 million from subscriptions.
On the hardware side, ChargePoint provides drivers and partners with access to 745,000 EV ports across North America and Europe, 243,000 of which are active ports under management on the ChargePoint network, an 18,000 increase from Q4. It also added approximately 2,000 DC fast-chargers to its network this quarter, bringing its total to 21,000.
Looking towards the rest of the year, CFO Rex Jackson said they plan to “manage expenses carefully and expect to deliver improvements in operating leverage.”
“In summary, we’ve achieved the growth we expected to achieve despite significant headwinds. We continue our march to profitability even while we invest in operational excellence at scale,” he said.
ChargePoint shares are currently trading at $9.27. Over the past six months its price has fluctuated, climbing from to a February high of $13.38 before beginning its current downward trend. Its current market capitalization is $3.26 billion.