Ballard Power Systems NASDAQ: BLDP reported first-quarter 2026 results highlighting year-over-year revenue growth, a third consecutive quarter of positive gross margin, and lower cash use from operations as the company continues its transformation toward cash flow positivity.
First-quarter performance and transformation priorities
President and CEO Marty Neese said the company had a “solid start to the year,” with deliveries into the bus and rail markets driving revenue growth versus the prior year. Neese also pointed to Ballard’s continued gross margin progress, noting the quarter marked the company’s “third consecutive quarter of positive gross margin,” which he said reflected “disciplined cost and commercial management” and represented “an important step in our transformation toward becoming cash flow positive.”
Neese outlined several near-term focus areas to build on that momentum, including:
- Deepening partnerships with bus OEMs in key geographies
- Improving and expanding Ballard Fleet Services capabilities and offerings
- Lowering costs through automation and intelligence
Bus market updates and fleet services strategy
Neese detailed several recent bus-market announcements across major regions. In North America, Ballard signed a multi-year agreement with New Flyer representing approximately 50 MW of fuel cell engine supply. In the U.K., Wrightbus selected Ballard to power its next-generation hydrogen bus platform using the FCmove-SC engine. In Europe, Solaris selected Ballard as the fuel cell supplier for its next-generation hydrogen bus platform, including the FCmove-SC for its 12-meter bus.
Neese said the agreements are significant because they are multi-year partnerships with leading OEMs that include both engine sales and long-term service support. He emphasized the role of engine intelligence and Ballard’s remote operations center in supporting uptime through real-time performance data, parts planning, logistics, and predictive insights.
Neese positioned Ballard Fleet Services as central to the company’s commercial strategy, describing a shift from being “only a module supplier” to a “proactive, data-driven fleet partner.” He said Ballard’s approach is built on more than 300 million kilometers of operating data and includes what he called the “industry-first uptime standard,” combining predictive maintenance, training, service support, and parts assurance. Neese said these offerings are designed to deliver “up to 98% fleet availability,” which he said reduces after-sales friction for OEMs and improves lifecycle cost predictability for operators, while creating recurring revenue opportunities for Ballard.
Neese also said the Wrightbus and Solaris selections support Ballard’s product cost-reduction efforts because both committed to the ninth-generation FCmove-SC platform. He said the FCmove-SC was designed to reduce cost and simplify installation and maintenance, and that Ballard cut the number of components by more than 40% while improving power density and durability. He noted that each bus deployment can generate a “long tail of service opportunities” given typical bus service lives of eight to 16 years, and highlighted Ballard Academy as part of the company’s operator and technician support.
Operations: new COO and Project Forge
New Chief Operating Officer Ralph Robinett introduced himself as joining Ballard with more than 25 years of operations, manufacturing, and supply chain experience across advanced technology and clean energy companies. Robinett said his background includes scaling production, launching new products, and using automation to improve productivity and reduce costs, including work with “an automated production facility built around a closed loop learning process” where field performance data fed back into product design and process improvement.
At Ballard, Robinett said the operational focus will be on “quality, cost reduction, improved throughput, consistent delivery at scale, and closed loop issue resolution,” along with customer collaboration that uses field data to drive product and process improvements.
Robinett highlighted “Project Forge,” Ballard’s high-volume automated bipolar plate manufacturing line. He said Ballard already uses AI-assisted vision systems to detect defects in membrane electrode assemblies (MEAs), and that Project Forge will deploy a similar methodology for plates. Robinett said increased automation and higher-volume production are expected to lower unit costs, reduce material waste, and improve quality, consistency, and scalability. He added that Ballard continues to expect Project Forge to enter full production in the second half of the year, calling a successful ramp “a top priority.”
He also said Ballard is increasingly leveraging engine performance data from deployed fleets to create insights that feed back into manufacturing, supply chain, and product development, with the aim of improving quality and reducing costs. Robinett said he expects the impact to show up over time in “product margin expansion and improved working capital management.”
Financial results and 2026 outlook
Chief Financial Officer Kate Igbalode reported total revenue of $19.4 million, up 26% year over year, driven by rail and bus. Gross margin improved to 14%, which Igbalode said was a 37-point increase versus Q1 2025 and marked the third straight quarter of positive gross margin. She attributed the improvement to higher revenue and lower manufacturing overhead.
Total operating expenses were $16.4 million, down 36% from the prior year. Igbalode said the decrease reflected disciplined cost control across R&D, SG&A, and commercial activities, as well as benefits from restructuring actions completed in 2025.
Cash used in operating activities was $7.8 million, compared with $24.4 million in the prior year, which Igbalode described as a 65% improvement due to restructuring impacts and stronger operating performance as the business scales. Adjusted EBITDA improved to negative $11.4 million from negative $27.5 million in Q1 2025, driven by stronger margins and lower operating expenses.
Ballard ended the quarter with $516.8 million in cash and cash equivalents, down about 2% from the prior quarter. Igbalode said the company has no bank debt and “no near or mid-term financing needs,” adding that the balance sheet provides flexibility to deploy capital toward becoming cash flow positive.
Consistent with past practice, Ballard did not provide specific revenue or net income guidance for 2026, citing the early stage of the hydrogen fuel cell market. However, Igbalode said the company expects revenue to be weighted toward the second half of the year, and provided guidance ranges of $65 million to $75 million for total operating expense and $5 million to $10 million for capital expenditures in 2026.
Q&A: stationary power, buses, rail, and hydrogen market conditions
During the question-and-answer session, Neese addressed drivers behind year-over-year growth in stationary power revenue. He said the increase was “largely diesel genset replacement business,” and “not necessarily tied to data centers,” while adding that the data center opportunity is an area of “deep exploration” that he expects to “materially change as we go forward.”
Asked about a year-over-year decline in the bus segment for the quarter, Neese said it was “just timing,” citing channel inventory and build schedules, and added that in the European Union there was “some slowness in some of the funding support” that affected demand flow. He said the company expects that to change as “the friction is reduced,” and reiterated that the Wrightbus and Solaris announcements were “major design wins for next-generation buses,” which he expects will translate into multi-year demand under the agreements.
On rail, Neese said Ballard’s prior deployments are “opening up future opportunities,” as customers gain familiarity with fuel cell locomotives and become more confident in the value proposition. He said the market could become an “annuity type” opportunity over time, where fleets replace diesel engines with fuel cells on an ongoing basis, though he characterized it as “early days.”
Neese also discussed hydrogen availability, saying Ballard has seen “meaningful progress” and that supply is “reasonable,” while adding that “unit economics is what needs to continue to improve.” He said more predictable offtake patterns can help suppliers become more aggressive on pricing depending on contract tenor, and described Ballard’s role as creating downstream demand signals. He added that green hydrogen is seeing “more and more penetration,” while gray hydrogen remains incumbent, and said green and blue hydrogen are likely to advance as renewables penetration increases globally.
Neese said Ballard will host a Capital Markets Day event, “the Ballard Forum,” on Oct. 22 to provide an in-depth look at its path to profitability.
About Ballard Power Systems NASDAQ: BLDP
Ballard Power Systems NASDAQ: BLDP is a Canadian technology company specializing in the development and manufacture of proton exchange membrane (PEM) fuel cell products. Headquartered in Vancouver, British Columbia, Ballard designs and sells fuel cell stacks and modules that enable zero-emission power generation for a variety of applications, including heavy-duty motive systems, backup power, material handling equipment, and portable power solutions.
Since its founding in 1979, Ballard has built a strong intellectual property portfolio and a track record of innovation in PEM fuel cell technology.
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