Why Did QuantumScape Stock Drop Almost 30% in the First Half of 2026?

QuantumScape (NASDAQ: QS) wants to revolutionize electric vehicle (EV) batteries with its solid-state battery technology. The company has made good progress toward proving the concept and commercializing its technology.

That may lead investors to question why QuantumScape stock plunged 27.4% in the first half of 2026, according to data provided by S&P Global Market Intelligence. Here's a look at where the business and the stock stand at the midyear point.

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Major milestones

QuantumScape hit some important milestones last year. They included:

• An expanded development effort and licensing deal with Volkswagen Group's battery maker, PowerCo.
• Partnerships with glass maker Corning and Murata Manufacturing to achieve high-volume production of QuantumScape's ceramic separators for commercial use.
• Integrating its advanced separator process into initial battery cell production.
• Demonstrating a real-world example with a Ducati motorcycle debut running on its solid-state battery.
• Signing joint development agreements with two large global automakers.
• Establishing a technology assessment agreement with a major new global automotive manufacturer.

Investors reacted by sending QuantumScape shares soaring in 2025. The stock doubled on all the positive news. The company has continued to make progress toward commercialization in 2026, with an agreement with Honda Motor's research and development arm to enhance the battery platform through joint contributions and expertise from both organizations.

That news could be key for investors, as Honda could expand the use case for solid-state batteries beyond automobiles and motorcycles to include power equipment such as generators and power tools.

Solid-state advantages

QuantumScape's batteries are expected to provide greater energy density, faster charging times, and improved safety on a large scale compared to conventional lithium-ion cells. With the company's separator process and an accelerated, continuous manufacturing method that mass-produces the solid-state separators in place, the focus can now be on QuantumScape's potential market opportunities.

As mentioned, those opportunities could go beyond electric cars. Beyond power equipment, QuantumScape is targeting in-rack energy storage for artificial intelligence (AI) factories. EVs are currently QuantumScape's focus, though. And QuantumScape now has agreements and relationships with multiple global automotive companies. But QuantumScape isn't the only company looking to capitalize on those opportunities.

That is another risk factor investors need to consider. An investment in QuantumScape carries somewhat less risk now than a year ago, thanks to its technology milestones. The stock's nearly 30% drop also reduces the risk level.

But there is already some success built into its $4.3 billion market cap. While less risky than at the start of 2026, investors should still allocate only an amount that would be comfortable for a speculative part of their portfolio.

Howard Smith has positions in QuantumScape. The Motley Fool has positions in and recommends Corning. The Motley Fool has a disclosure policy.