Ballard Power Systems Announces Strategic Realignment to Achieve Positive Cash Flow by 2027.

Ballard Power Systems has announced a strategic realignment under new President and CEO Marty Neese to strengthen its commercial focus and achieve positive cash flow by 2027. The plan includes tighter portfolio integration, staff modifications, and a 30% decrease in operating expenses in 2026. Priorities include focusing on high-traction fuel cell solutions, terminating non-core programs, and raising gross margins through cost-cutting and value-based pricing. Ballard has $550 million in cash and will manage working capital, optimize inventory, and restrict capital expenditures.

Ballard Power Systems, a leading fuel cell technology company, has unveiled a strategic realignment plan under the new leadership of President and CEO Marty Neese. The plan aims to achieve positive cash flow by the end of 2027, focusing on operational excellence and cost discipline. The company's second-quarter financial results, released on July 2, 2025, highlighted the initial steps taken towards this goal.

The strategic realignment includes a reduction of annualized operating costs by approximately 30% compared to the first half of 2025, primarily driven by workforce reductions announced in July. Neese emphasized the importance of focusing on "real, near-term opportunities" and a sustainable business model that emphasizes operational excellence and cost discipline.

The company's new strategy also involves simplifying its product portfolio to focus on its strongest offerings and implementing new pricing strategies to support margin expansion. Ballard will continue to limit capital expenditure and manage its cash flow to maintain a strong balance sheet.

Ballard reported revenue of $17.8 million for the second quarter, an 11% increase year-over-year, driven by deliveries to bus and rail customers in North America and Europe. The company's gross margin improved significantly, rising by 24 points to negative 8%, due to lower manufacturing overhead costs from previous restructuring efforts. Despite the revenue growth, the company's order backlog saw a decrease. Total order backlog at the end of the second quarter was $146.2 million, a 7% decrease from the end of the first quarter.

Neese stated that the company believes in the necessary role of hydrogen and fuel cells to decarbonize select heavy mobility and stationary power applications. With $550 million in cash and no bank debt, Ballard is well-positioned to serve its customers in the long term. The company did not provide specific revenue or net income guidance for the rest of 2025 but expects revenue to be weighted toward the second half of the year.

The strategic realignment plan includes a 27% reduction in cash operating costs and a 19% reduction in total operating expenses, driven primarily by restructuring actions taken in 2024. These reductions are expected to be fully realized in 2026, with the majority of restructuring charges recognized in the third quarter.

In addition to the financial restructuring, Ballard announced a change to its Board of Directors, with Yingbo Wang stepping down and Huajie Wang appointed as a Weichai nominee director. The Board thanked Yingbo for his valuable contributions and welcomed Huajie, who will bring extensive experience and strategic insight to the Board.

Ballard will hold a conference call on August 11, 2025, to review its first quarter 2025 operating results. The live call can be accessed through a toll-free number or a webcast link on Ballard's homepage.

References:
[1] https://finance.yahoo.com/news/ballard-power-systems-reveals-bold-133000641.html
[2] https://www.ballard.com/press-release/ballard-reports-q2-2025-results/