Declining EV Revenues Will Constrain Margins Yet Enable Recovery

Key Takeaways

• Declining government incentives or home charging adoption could cap Blink's revenue growth, limit charging utilization, and challenge future profitability.
  
• Heightened competition, high operating costs, and potential capital needs pose significant risks to margin expansion and shareholder returns.
  
• Weakening product revenue, persistent losses, and operational cost challenges threaten long-term profitability as margin pressures and market competition intensify.

Catalysts

Through its subsidiaries, owns, operates, manufactures, and provides electric vehicle (EV) charging equipment and networked EV charging services in the United States and internationally.

• Although Blink Charging is poised to benefit from increasing government policies and incentives that support EV charging network expansion in North America and Europe, the company faces the risk that these subsidies could slow or reverse in coming years, which would directly limit its addressable market and act as a headwind to future revenue growth.
  
• While rapid global adoption of electric vehicles and tightening emissions regulations currently support steady growth in charging utilization across Blink's networks, ongoing innovation in battery technology-such as longer-range or faster-charging batteries-may decrease the reliance on public chargers, potentially reducing long-term utilization rates and pressuring both revenue and gross margin expansion.
  
• Despite the expansion of Blink's vertically integrated hardware portfolio, with company-owned and self-assembled chargers expected to drive improved gross margins and recurring service revenue, intensifying competition from well-funded players and new entrants could result in price pressures that keep net margins under persistent pressure and slow any path to profitability.
  
• Although strategic partnerships with municipalities, corporate customers, and parking lot owners are enhancing Blink's installed base, industry-wide trends toward home and workplace charging over public infrastructure present a structural challenge that may cap usage growth and thus constrain transaction-based revenue increases over the longer term.
  
• While international expansion and integration of advanced energy management systems (such as the Create Energy NanoGrid partnership) offer avenues for future top-line growth and product differentiation, high ongoing operating costs and the potential need for additional capital-especially if current net losses and cash burn remain elevated-raise the risk of shareholder dilution and delayed improvement in earnings per share.

Blink Charging Future Earnings and Revenue Growth

Assumptions

• This narrative explores a more pessimistic perspective on Blink Charging compared to the consensus, based on a Fair Value that aligns with the bearish cohort of analysts.
• The bearish analysts are assuming Blink Charging's revenue will grow by 17.4% annually over the next 3 years.
• The bearish analysts are not forecasting that Blink Charging will become profitable in next 3 years. To represent the Analyst Price Target as a Future PE Valuation we will estimate Blink Charging's profit margin will increase from -184.4% to the average US Electrical industry of 10.2% in 3 years.
• If Blink Charging's profit margin were to converge on the industry average, you could expect earnings to reach $18.0 million (and earnings per share of $0.17) by about August 2028, up from $-201.7 million today. The analysts are largely in agreement about this estimate.
• In order for the above numbers to justify the price target of the more bearish analyst cohort, the company would need to trade at a PE ratio of 7.7x on those 2028 earnings, up from -0.5x today. This future PE is lower than the current PE for the US Electrical industry at 32.4x.
• Analysts expect the number of shares outstanding to grow by 1.55% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 8.9%, as per the Simply Wall St company report.

Blink Charging Future Earnings Per Share Growth

Risks

• Blink Charging reported a significant decline in product revenue, dropping from 27.5 million dollars in the first quarter of 2024 to 8.4 million dollars in 2025, highlighting vulnerability to shifts in customer demand and raising concerns about the sustainability of top-line revenue growth.
  
• Despite growth in recurring service revenue, the company continues to post sizable net losses, with loss per share widening from 17 cents to 20 cents year-over-year and adjusted EBITDA loss increasing to 15.5 million dollars, which may pressure future earnings and increase the risk of equity dilution if capital needs persist.
  
• Macroeconomic pressures and increased price sensitivity among customers have led to a shift toward value-oriented products, suggesting potential for margin compression and challenging the company's ability to improve net profit margins in the long term.
  
• The delay in filling gaps in the product portfolio, especially in the value segment, indicates potential weaknesses in market responsiveness compared to larger, better-capitalized competitors, which could limit market share gains and future revenue streams.
  
• The company's need for ongoing cost reductions, coupled with the admission that you can't cut your way to profitability, underscores operational cost challenges that may persistently undermine earnings quality if revenue growth does not recover.

Valuation

• The assumed bearish price target for Blink Charging is $1.0, which represents the lowest price target estimate amongst analysts. This valuation is based on what can be assumed as the expectations of Blink Charging's future earnings growth, profit margins and other risk factors from analysts on the more bearish end of the spectrum.
• However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $5.0, and the most bearish reporting a price target of just $1.0.
• In order for you to agree with the bearish analysts, you'd need to believe that by 2028, revenues will be $176.9 million, earnings will come to $18.0 million, and it would be trading on a PE ratio of 7.7x, assuming you use a discount rate of 8.9%.
• Given the current share price of $0.94, the bearish analyst price target of $1.0 is 6.0% higher.
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.