Chargepoint rails against demand scare stories

US CPO Chargepoint has concerns that reports of a slowdown in EV adoption growth are affecting its business, as the company reported a significant year-on-year revenue decline.

The company's fourth quarter revenue was $115.8mn, down by 24pc from $152.8mn in the same quarter of 2022. Networked charging systems revenue for the fourth quarter was $74mn, down by 39pc year-on-year from $122.3mn in Q4'22.

News coverage around EV demand has been dampening the appetite of commercial customers for charging infrastructure, according to Chargepoint CEO Rick Wilmer.

"Institutions want EV charging, but are hesitant to commit at a time when the news is questioning EV adoption," he says.

These concerns about EV penetration are circulating despite a healthy outlook for the industry, Wilmer notes.

"Looking at the year ahead, Bloomberg NEF estimates passenger EV sales will grow at 32pc year-over-year in North America and 10pc year-over-year in Europe," the CEO says.

Disagreggation trend

Chargepoint did, however, see 30pc revenue growth to $33.5mn from its subscription services.

The CEO says he expects disaggregation — when customers buy software and hardware separately and often from different providers — to become more common.

"We are seeing disaggregation between hardware and software purchases, particularly amongst larger customers that prefer a multiple sourcing model," Wilmer says.

This could open up opportunities for CPOs to generate a greater chunk of their revenues with high margin software orders.

The CEO also confirmed that Chargepoint has seen commercial customers become more interested in sourcing hardware from more than one provider.

Chargepoint recently signed a deal with with Taiwanese power supply manufacturer Acbel Polytech to supply its hardware, which management says is the cornerstone of a new manufacturing model.

Chargepoint has also seen its utilisation rates improve, outpacing active port growth across all commercial sectors in 2023 — a promising indication of addressable demand.

"We are seeing the port utilisation continue to rise, which is leading to customers expressing interest in increasing the size of their networks [...] but I think we are still in a bit of an overhang as a result of all the negative press around the decreasing rate of EV adoption," Wilmer continues.