1 Big Reason I'm Keeping an Eye on Plug Power Stock in 2025

Key Points

• Plug Power is still losing a lot of money.

• The company set a cost-cutting program into motion earlier this year.

• Management forecasts that it will hit breakeven on a key metric next quarter, which would put it one step closer to profitability.

• 10 stocks we like better than Plug Power ›

Plug Power (NASDAQ: PLUG) has been one of the most dramatic turnaround stocks on the market in recent months. After dropping by 30% in the first half of 2025, the hydrogen stock has surged by 93% in the past three months, as of this writing.

To be sure, Plug Power continues to secure new deals, but it has been doing that for a pretty long time now, and for more than 25 years, the company has failed to turn a profit.

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However, Plug Power is doing something now that has reignited investor interest, and it's the biggest reason I'm keeping an eye on the stock in 2025 and beyond.

Image source: Getty Images.

Plug Power is finally doing something right

Plug Power's results last quarter were a welcome improvement: Its revenue grew 21% year over year, and while its gross margin was negative 31%, that was a sharp improvement from negative 92% in Q2 2024.

Early this year, in a bid to cut its costs and cash burn rate, Plug Power launched what it's calling Project Quantum Leap -- an array of moves with the collective aim of saving it between $150 million and $200 million annually. Plans include layoffs, cuts in discretionary spending, facility consolidation, and limiting capital spending to critical projects for now.

The targeted savings from those efforts will be relatively small for a company that reported $2.1 billion in operating losses in 2024, but they're a step in the right direction, because no number of deals will be able to help Plug Power if it doesn't have the money to scale production, pay for day-to-day operations, and fulfill orders.

While it's hard to guess when Plug Power will become profitable, let alone generate positive cash flow, management says it expects to achieve "gross margin breakeven on a run-rate basis" in the fourth quarter. Simply put, Plug Power believes it will finally make enough money from sales to cover its production costs next quarter.

That's the big reason I'll be keeping an eye on Plug Power stock for the rest of the year, because even breaking even on gross margins will be a milestone for this loss-making company. That said, an achievement like that should never be viewed, on its own, as a good enough reason to invest in a stock.

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Neha Chamaria has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.