QuantumScape (QS -0.11%) has dramatically underperformed the market over the past year, with shares falling by more than 20%. However, while this remains a pre-revenue business several years after making its publicly traded debut, there are also some impressive signs of progress in the EV battery innovator. With that in mind, here's a look at the current state of QuantumScape's business, where it could be heading over the next couple of years, and whether the stock could be a smart buy today. QuantumScape i ...

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Jason Hall has positions in QuantumScape and has the following options: long January 2026 $7 calls on QuantumScape and short January 2027 $5 puts on QuantumScape. Tyler Crowe 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. Jason Hall is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through their link they will earn some extra money that supp ...

Core Viewpoint - QuantumScape and ChargePoint are two distinct investment opportunities in the electric vehicle (EV) market, with QuantumScape focusing on solid-state batteries and ChargePoint on EV charging infrastructure [1][2]. QuantumScape - QuantumScape has been developing solid-state lithium metal batteries for 15 years but has yet to commercialize any products, with mass production expected to start in 2026 [4][5]. - The QSE-5 battery is projected to have an energy density exceeding 800 Wh/L and can charge from 10% to 80% in under 15 minutes, outperforming traditional lithium-ion batteries [4]. - Analysts predict QuantumScape's revenue will reach $4 million in 2026 and $93 million in 2027, with an enterprise value of $1.63 billion, leading to a valuation of 18 times its 2027 sales [8]. - Competition from major automakers and startups in the solid-state battery space poses a significant challenge for QuantumScape [7]. ChargePoint - ChargePoint managed 342,000 charging ports across North America and Europe by the end of fiscal 2025, with over 33,000 being Level 3 fast chargers [9]. - ChargePoint's revenue grew by 65% in fiscal 2022 and 93% in fiscal 2023, but it faced an 18% decline in fiscal 2025 due to rising interest rates affecting the EV market [11][12]. - Analysts forecast ChargePoint's revenue to grow at a compound annual growth rate of 21% from fiscal 2025 to fiscal 2028, reaching $738 million, with adjusted EBITDA expected to turn positive in fiscal 2027 [13]. - ChargePoint's enterprise value is $495 million, trading at just 1.1 times this year's sales, indicating potential for a higher valuation as the EV market recovers [14]. Investment Recommendation - ChargePoint is viewed as a more attractive investment compared to QuantumScape, given its current undervaluation and established market presence in EV charging infrastructure [15].

Core Insights - The logistics sector has seen significant engagement from investors, particularly in the ASEAN and US markets, highlighting its growth potential [1] - The popularity of insurance companies in the Philippines since 2014 indicates a shift in investment strategies among local investors [1] - The diversification of investment portfolios across various industries and market capitalizations is becoming a common practice among investors [1] Investment Trends - There is a notable trend of investing in blue-chip companies initially, followed by a broader investment strategy that includes different sectors such as banking, telecommunications, and retail [1] - The entry into the US market has been facilitated by platforms like Seeking Alpha, which provide valuable analyses for comparison with local markets [1] - The focus on retirement investments alongside trading profits reflects a dual strategy in investment approaches [1] Market Engagement - The logistics, banking, and hotel sectors are highlighted as key areas of investment interest in both the ASEAN and US markets [1] - The experience of acting as a personal broker for a relative has increased awareness and understanding of the US market dynamics [1] - The use of comparative analyses between the US and Philippine markets suggests a strategic approach to identifying investment opportunities [1]

Core Viewpoint - QuantumScape is developing next-generation solid-state lithium-metal battery technology that could significantly enhance the performance and efficiency of electric vehicles (EVs) [2][3][11] Group 1: Technology and Development - QuantumScape's advanced battery technology promises improvements in energy density, charging speed, and safety, potentially allowing vehicles to achieve driving ranges of 400 to 500 miles on a single charge [3] - The company has reached critical milestones, including the shipment of low-volume battery prototypes for testing and validation [4] - QuantumScape is progressing with its separator heat treatment processes, which are essential for scaling up production and moving closer to commercial viability [5][6] Group 2: Financial Position - As of the end of the first quarter, QuantumScape had approximately $860 million in liquidity, sufficient to sustain operations into the second half of 2028 [8] - Analysts project that QuantumScape will not generate revenue until 2026, with expected revenues of $3.8 million, accelerating to $50.6 million in 2027 and reaching $490.6 million in 2028 as the company achieves commercial scale [10] Group 3: Market Outlook - The company is still in the production and testing phases, and it may take several years before it begins to generate meaningful revenue, necessitating patience from investors [11] - The stock is currently at an all-time low, and while the technology has potential, the company remains vulnerable to further declines if development timelines are delayed [12]

Financial Performance - The company incurred a net loss of approximately $123.6 million for the three months ended March 31, 2025, with an accumulated deficit of approximately $3.5 billion since inception [128]. - The net loss attributable to common stockholders was $114.4 million in Q1 2025, a 5% improvement compared to a net loss of $120.6 million in Q1 2024 [159]. - Cash used in operating activities was $60.7 million in Q1 2025, compared to $57.9 million in Q1 2024, driven by a net loss and non-cash expenses [170][172]. - The company has not yet generated revenue and relies on equity financing to fund operations and capital expenditures [165]. Cash Flow and Resources - Cash and cash equivalents, along with marketable securities, totaled approximately $860.3 million as of March 31, 2025, down from $910.8 million at the end of 2024 [164]. - Cash provided by investing activities was $62.0 million in Q1 2025, primarily from the maturity of marketable securities, offset by purchases of securities and equipment [170][175]. - Cash provided by financing activities was $11.4 million in Q1 2025, mainly from the exercise of stock options, compared to $1.2 million in Q1 2024 [170][177]. - The company expects its cash resources to last into the second half of 2028, with a shelf registration statement allowing for an aggregate offering price of up to $1 billion [144]. - The company believes its cash resources will last into the second half of 2028, contingent on successful technology development and operational milestones [167]. Research and Development - Research and development expenses increased by 14% to $95.6 million in Q1 2025 from $83.8 million in Q1 2024, primarily due to higher depreciation and non-cash stock-based compensation [159][160]. - The company expects significant increases in research and development expenses as it ramps up engineering operations for solid-state lithium-metal batteries [151][160]. Product Development and Collaboration - The first commercial product, QSE-5, has a capacity of approximately 5 amp-hours, an energy density of over 800 Wh/L, and a fast-charging capability of 10% to 80% in less than 15 minutes [130]. - The company entered into a collaboration agreement with PowerCo, which includes an initial royalty fee of $130 million for the licensing of QSE-5 technology for automotive applications [141]. - The pilot line in San Jose, California is focused on increasing throughput and capability for manufacturing battery cells and separators [135]. - The company plans to improve the quality, consistency, and reliability of its cells through automation and process control [131]. - The automotive qualification process involves multiple sampling stages (A, B, and C samples) with timelines influenced by product development risks and OEM validation [138]. - The company is exploring opportunities in stationary storage and consumer electronics markets in addition to automotive applications [142]. Regulatory and Market Risks - Regulatory changes and trade tariffs may impact the company's ability to meet projected sales or margins, particularly with potential shifts in U.S. economic policy [147]. - There have been no material changes to the Company's market risk during the three months ended March 31, 2025 [183]. Accounting and Financial Reporting - The consolidated financial statements are prepared in accordance with U.S. GAAP, requiring significant judgment in estimates and assumptions affecting reported amounts [179]. - Critical accounting estimates are identified as those requiring complex judgments that could materially impact financial statements [180]. Administrative Expenses - General and administrative expenses decreased by 42% to $28.0 million in Q1 2025 from $48.1 million in Q1 2024, mainly due to a settlement related to litigation and reduced professional fees [159][161].

Exhibit 99.1 Q1 FISCAL 2025 LETTER TO SHAREHOLDERS April 23, 2025 Launch Program Update We continue to work closely with our prospective launch customer. As a reminder, this launch program is designed to be a low-volume but high-visibility project. It is intended to serve as a real-world vehicle demonstration, highlighting the exceptional performance characteristics of our technology platform as a step toward large-scale commercialization. The program is planned to unfold over multiple phases, with field te ...

Core Viewpoint - QuantumScape, a solid-state battery manufacturer, has faced significant challenges since its public debut, but insider buying and upcoming product developments suggest potential for recovery and investment opportunity [2][3][5]. Company Overview - QuantumScape went public via a SPAC merger on November 27, 2020, with an initial stock price of $24.80, peaking at $131.67 shortly after [2]. - The company projected revenues of $14 million in 2024, $39 million in 2025, and $275 million in 2026, but has yet to commercialize its batteries and does not expect to do so until 2026 [2][3]. Current Financial Status - The stock price has fallen to below $4, with a market capitalization of $2.1 billion, indicating that significant growth expectations are still factored into its valuation [4]. - QuantumScape has increased its outstanding shares by 57% since going public, primarily due to stock-based compensation and secondary offerings [4]. Insider Activity - Over the past three months, QuantumScape's insiders purchased nearly five times as many shares as they sold, indicating a potentially positive outlook from those with inside knowledge [5]. Product Development - QuantumScape's solid-state lithium metal batteries offer advantages over traditional lithium-ion batteries, including higher energy density (over 800 Wh/L) and faster charging times [6][7]. - The company aims to enter the electric vehicle (EV) market with its QSE-5 batteries, which are co-developed with Volkswagen, and has begun shipping prototype samples to automakers [8][9]. Challenges Ahead - The company faces challenges such as unpredictable tariffs from the Trump administration, which could impact supply chains and component prices, as well as competition from other automakers like Toyota and Nio [10][11]. - Analysts project that QuantumScape will not generate revenue in 2025 and will only achieve $3.5 million in 2026, with significant net losses expected [12]. Investment Considerations - The current low expectations from analysts mean that any positive developments in the upcoming earnings report could lead to a stock price increase [12]. - Despite being a speculative investment, there may be opportunities for gains if the company successfully upgrades its processes and commercializes its batteries by 2026 [13].

Core Insights - The electric vehicle (EV) industry has experienced a notable slowdown in sales growth since 2021, leading to increased controversy surrounding major companies in the sector [1] - QuantumScape's stock has significantly declined, with a $1,000 investment made in April 2021 now worth less than $107, reflecting a nearly 90% decrease [2] - Despite its current challenges, QuantumScape is developing a promising solid-state EV battery that offers greater range and faster charging compared to traditional lithium-ion batteries [3] Company Overview - QuantumScape is backed by Volkswagen, which has invested hundreds of millions of dollars into the company [4] - Volkswagen plans to license QuantumScape's technology for its EVs once the development stage is completed, potentially powering up to one million new vehicles annually [4] - The investment in QuantumScape is considered risky due to its pre-revenue status, but the technology shows significant promise and the partnership with Volkswagen provides financial stability [5]