Hexagon Purus ASA's Q2 2025 Earnings: Navigating the Hydrogen Infrastructure Transition and Unlocking Long-Term Value

Hexagon Purus ASA (HPURF) has emerged as a pivotal player in the global hydrogen infrastructure race, but its Q2 2025 earnings report reveals a complex narrative of near-term challenges and long-term strategic resilience. For investors, the question is whether the company's current struggles mask a durable competitive position in a sector poised for explosive growth.

A Revenue Downturn, But Strong Order Intake Signals Resilience

Hexagon Purus reported Q2 2025 revenue of NOK 193 million, a 63% year-over-year decline, driven by a 69% drop in its Hydrogen Mobility and Infrastructure (HMI) segment to NOK 164 million. The sharp contraction reflects reduced activity in hydrogen distribution modules and heavy-duty mobility applications, exacerbated by project delays and economic uncertainty. However, the company's order backlog of NOK 1.1 billion—a 33% increase from Q1 2025—suggests a near-term rebound. Of this backlog, 40% is slated for 2025 delivery, with the remainder extending into 2026 and beyond. This visibility into future demand is critical, as it indicates Hexagon Purus is not merely reacting to a downturn but positioning itself to capitalize on a post-pandemic recovery in hydrogen infrastructure.

The HMI segment's EBITDA loss of NOK -76 million (compared to NOK 17 million in Q2 2024) underscores the margin pressure from lower volumes and a less profitable product mix. Yet the company's cost-cutting initiatives—targeting NOK 350 million in annualized savings by 2026—are designed to bridge the gap between current cash flows and long-term profitability. These measures, combined with a cash reserve of NOK 527 million, provide a buffer to navigate the transition phase.

Strategic Shifts: From Hydrogen to Battery Electric Mobility

Hexagon Purus' recent partnership with Hino Trucks to deliver Class 6 & 7 battery electric trucks in the U.S. signals a calculated pivot toward battery electric mobility (BEM). While this move diversifies the company's revenue streams, it also raises questions about resource allocation. The BVI segment, which handles battery systems and vehicle integration, reported NOK 25 million in revenue for Q2 2025—a modest but encouraging rise from NOK 2 million in Q2 2024. However, the segment's EBITDA remains negative at NOK -31 million, highlighting the need for operational scaling.

The company's decision to initiate a strategic review of its BVI segment is prudent. By evaluating growth opportunities and structural improvements, Hexagon Purus can determine whether to deepen its BEM investments or refocus on hydrogen infrastructure. For investors, this flexibility is a strength. The hydrogen market, though currently sluggish, is expected to rebound in key regions like Europe and North America, where hydrogen transit buses and aerospace applications are gaining traction.

Hydrogen Infrastructure's Long-Term Outlook: A Sector in Transition

The global hydrogen infrastructure market is projected to grow at a 30–40% CAGR through 2030, driven by green hydrogen adoption and decarbonization mandates. Hexagon Purus' recent joint venture with CIMC in China—producing hydrogen cylinders for the European market—positions it to benefit from this growth. Additionally, contracts with Stadler (hydrogen rail in California) and MCV (FCEV buses for Europe) underscore its ability to secure high-margin, long-term projects.

Despite near-term headwinds, the company's order backlog diversification—35% in hydrogen mobility, 29% in hydrogen infrastructure, and 32% in aerospace—suggests a balanced approach to risk. Aerospace applications, in particular, offer a high-growth tailwind, with North America's demand for hydrogen-powered aircraft components expected to surge.

Valuation and Investment Implications

Hexagon Purus' current valuation appears undervalued relative to its long-term potential. At a trailing P/E ratio of 12x (based on 2024 earnings), the stock trades at a discount to peers in the clean energy sector. The company's NOK 527 million cash balance and NOK 1.1 billion order backlog provide a strong foundation for value creation.

For long-term investors, the key risks are near-term liquidity constraints and execution risks in the BVI segment. However, the company's aggressive cost reductions and focus on hydrogen infrastructure—where it holds a 20–25% market share in Type 4 cylinder production—mitigate these concerns.

Conclusion: A Buy for the Patient Investor

Hexagon Purus is navigating a sectoral transition, but its strategic agility and robust order pipeline position it to emerge stronger. While the Q2 2025 earnings reflect the pain of a slowdown in hydrogen infrastructure, the company's cost discipline, diversified backlog, and pivot into BEM offer a compelling risk-reward profile. Investors with a 3–5 year horizon should consider HPURF as a speculative buy, with upside potential tied to a global hydrogen infrastructure recovery and successful execution of its strategic initiatives.

In the words of former CEO Morten Holum, the company is preparing for a “new reality.” For Hexagon Purus, that reality may well define the next chapter in the hydrogen revolution.