Stem (NYSE:STEM) Issues Earnings Results, Misses Expectations By $0.15 EPS

Key Points

• Stem missed Q1 expectations with EPS of ($2.22) versus consensus ($2.07) and revenue of $29.0M versus expected $34.61M.
• Despite the miss, Stem reported its fourth consecutive positive adjusted EBITDA of $2M, expanded non‑GAAP gross/growth margin to ~52%, cut cash operating expenses ~30% YoY, and highlighted PowerTrack product momentum plus the acquisition of raicoon.
• Near‑term cash remains a concern with Q1 operating cash flow of negative $8M and ending cash of $37M; management reaffirmed a modest full‑year operating cash flow target of $0–$10M, and the CEO sold 5,145 shares, reducing his stake.

Stem (NYSE:STEM - Get Free Report) posted its quarterly earnings data on Wednesday. The company reported ($2.22) EPS for the quarter, missing analysts' consensus estimates of ($2.07) by ($0.15), FiscalAI reports. The company had revenue of $29.00 million during the quarter, compared to analysts' expectations of $34.61 million.

Here are the key takeaways from Stem's conference call:

• Profitability traction: Stem reported $2M adjusted EBITDA, its fourth consecutive positive quarter and the first-ever positive result in a seasonally weak Q1, and the company reaffirmed full-year guidance.
• Margins and cost discipline: Non-GAAP gross/growth margin expanded to ~52% (PowerTrack margins ~75%), while cash operating expenses were down ~30% YoY and ~10% sequentially, aided by AI-driven productivity gains.
• PowerTrack product momentum and tuck-in acquisition: PowerTrack software revenue grew 16% YoY, ARR rose modestly, the AI assistant PowerTrack Sage is live with early engagement, and Stem acquired raicoon to add automated fault detection and alert prioritization to the platform.
• Utility-scale expansion: Utility-scale bookings more than doubled QoQ, the EMS pipeline is the strongest the company has seen (including multi-site hybrid wins in Europe), and a co-marketing partnership with Nuvation targets North American BESS demand.
• Near-term cash dynamics: Operating cash flow was negative $8M in Q1 due to working-capital timing (ending cash was $37M), and management expects cash generation to improve later in 2026 but reaffirmed a modest full-year operating cash flow target of $0–$10M.

Stem Trading Up 1.9%

Shares of NYSE STEM traded up $0.21 on Wednesday, reaching $10.79. 222,792 shares of the company traded hands, compared to its average volume of 187,027. Stem has a fifty-two week low of $5.93 and a fifty-two week high of $32.23. The company has a 50 day moving average of $10.34 and a 200 day moving average of $14.81. The stock has a market capitalization of $91.89 million, a PE ratio of -1.14 and a beta of 1.51.

Insider Transactions at Stem

In related news, CEO Arun Narayanan sold 5,145 shares of the business's stock in a transaction that occurred on Tuesday, March 10th. The shares were sold at an average price of $11.12, for a total value of $57,212.40. Following the completion of the sale, the chief executive officer directly owned 12,980 shares in the company, valued at approximately $144,337.60. The trade was a 28.39% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. Insiders have sold 10,366 shares of company stock valued at $114,190 in the last ninety days. 5.10% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Stem

A number of institutional investors have recently bought and sold shares of STEM. IFP Advisors Inc grew its holdings in Stem by 258.1% in the third quarter. IFP Advisors Inc now owns 1,479 shares of the company's stock valued at $26,000 after purchasing an additional 1,066 shares during the period. Bridgeway Capital Management LLC purchased a new stake in Stem in the second quarter valued at approximately $97,000. Renaissance Technologies LLC purchased a new stake in Stem in the fourth quarter valued at approximately $169,000. Wells Fargo & Company MN grew its holdings in Stem by 89.2% in the fourth quarter. Wells Fargo & Company MN now owns 11,646 shares of the company's stock valued at $175,000 after purchasing an additional 5,492 shares during the period. Finally, Balyasny Asset Management L.P. purchased a new stake in Stem in the fourth quarter valued at approximately $177,000. 61.63% of the stock is currently owned by hedge funds and other institutional investors.

Wall Street Analyst Weigh In

A number of equities research analysts have recently commented on STEM shares. Weiss Ratings downgraded shares of Stem from a "hold (c-)" rating to a "sell (d+)" rating in a report on Wednesday, April 29th. Susquehanna decreased their target price on shares of Stem from $21.00 to $10.00 and set a "neutral" rating on the stock in a research report on Thursday, April 9th. UBS Group reaffirmed a "neutral" rating and issued a $12.00 target price (down from $18.00) on shares of Stem in a research note on Tuesday, March 10th. Finally, Wall Street Zen downgraded Stem from a "hold" rating to a "sell" rating in a report on Saturday, March 7th. Three equities research analysts have rated the stock with a Hold rating and two have issued a Sell rating to the company's stock. According to data from MarketBeat, Stem presently has an average rating of "Reduce" and an average price target of $15.75.

Stem Company Profile

Stem, Inc is a technology company specializing in AI-driven energy storage and optimization solutions for commercial, industrial and utility customers. The company delivers integrated hardware and software systems that enable clients to manage energy consumption, reduce peak demand charges and provide ancillary services to the power grid. By combining battery storage hardware with advanced machine-learning algorithms, Stem helps organizations align energy usage with cost-saving opportunities while supporting grid reliability and renewable integration.

At the core of Stem's offering is its Athena software platform, which uses real-time data and predictive analytics to forecast energy needs and automatically dispatch stored energy when it is most valuable.

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