Is Plug Power Stock a Buy Now?

I won't bury the lede -- and if you've read anything I've written about hydrogen fuel cell company Plug Power (NASDAQ: PLUG) over the last few years, this probably won't come as a surprise -- but the short answer to the above headline is: No. Plug Power stock is not a buy.

And now I'll tell you why not.

Image source: Getty Images.

Plug's latest earnings report

Let's start with the latest numbers from Plug.

Plug Power reported its third-quarter financial results on Nov. 10. The company collected $177 million in revenue for the quarter, up only 2% year over year, and slower than its 11% growth rate so far this year (so revenue growth is slowing). Worse, it cost Plug $297.2 million to generate this revenue (its cost of goods sold), leaving Plug $120 million in the hole even before accounting for operating costs.

Operating the business then cost Plug a further $228.6 million.

By the time Plug reached the bottom line of its income statement, its net loss was $365.5 million for the quarter (and $789.1 million so far this year).

So Plug stock is losing a lot of money. Worse, Plug seems to lose more and more money as time goes by. Losses are up 2.5% year over year so far in 2025, and grew 72% in the third quarter alone.

This is the opposite of what you'd expect to see if simply growing sales and "scaling up" to reach economies of scale would suffice to turn Plug stock profitable. It honestly looks like the more Plug sells, the more money it loses!

Plug's plans

Does Plug have a plan to change this? Well, yes and no.

The same day earnings came out, Plug announced plans to raise $275 million through "monetization of electricity rights" and other measures. It's not 100% clear what this plan entails, but it appears to imply that Plug will pre-sell the electricity it hopes to generate for artificial intelligence data centers, presumably at a discount.

If this is correct, it doesn't sound like a great way to maximize profit margins and may also hamstring efforts to grow revenue (and profit) over time.

Plug also advised it will "suspend activities related to the Department of Energy loan program and reallocate capital toward higher-return opportunities across its hydrogen network." Again, this is something that seems logical on the surface, but it would also apparently mean that Plug will give up the $1.7 billion DoE loan it secured in January, which was to fund the construction of six new hydrogen production plants -- key to growing the company's hydrogen fuel business.

And that doesn't sound promising at all.

Raising cash to plug the hole

More recently, Plug has announced two other plans to plug the hole in its balance sheet and stop the bleeding. On Nov. 21, Plug raised $431.25 million ($399.4 million after fees, so just a little more money than it lost in Q3 alone) by selling convertible debt. The new debt will cost Plug only 6.75% in annual interest, and the company will use the cash it raises to pay off "high-cost 15% debt" and retire some other convertible notes.

Once more, this is something that sounds positive. But what Plug is really doing here is just rolling over old debt -- and creating the potential for future stock dilution when the new debt is "converted" into common stock.

What's next for Plug and its shareholders?

How far in the future might this happen? Perhaps not as far as you think, because on Nov. 21, Plug also announced it will be asking its shareholders to approve a doubling of its authorized share count, from 1.5 billion to 3 billion shares.

There are only two logical reasons why Plug might want to do this:

The first is because it needs the authorization so that it can convert debt into shares. The second is that Plug might want to issue and sell even more shares outright, to raise cash to fund its ongoing losses. And both of these scenarios imply massive stock dilution of Plug Power shareholders in the future.

If you ask me, the smart move here is to sell Plug stock before that happens -- and I definitely would not buy Plug stock before it happens.

Rich Smith 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.