HPQ Silicon: Batteries for the US Drone Boom?
HPQ Silicon has taken an important step toward commercialization with its ENDURA+ Gen4 21700 lithium-ion cells. The cells have successfully completed UN 38.3 certification and are therefore approved for international transport. This is particularly relevant for HPQ, as several potential customers from the drone and defence sectors are currently testing the technology as part of qualification programs. The certification thus removes a key regulatory hurdle and enables the company to ship samples worldwide for evaluation and further approval processes.
The marketing strategy will initially focus on applications where high energy density, low weight, and long operating time are particularly important. These include, among others, the AA-NOVA-6S3P drone battery developed by HPQ partner Novacium, which was designed at the request of a European drone manufacturer. HPQ holds exclusive marketing rights in North America for Novacium’s silicon anode technology. The company sees attractive opportunities particularly in the growing market for military and commercial drones and aims to lay the groundwork for broader market penetration with its first successful customer references.
The development follows a clearly defined phased plan. Following technology validation, independent testing, and certifications, HPQ is currently in the customer qualification phase. During this phase, the batteries are tested, optimized, and then validated again. The next crucial step would be commercial orders, followed by the expansion of production capacity and a subsequent expansion into additional application areas. HPQ is thus on the verge of commercial deployment of the ENDURA+ platform.
The timing appears favorable. The US is under increasing pressure regarding military drones. China, in particular, has a strong industrial base and can produce drones and key components in large quantities. The war in Iran has shown that its high-tech missiles cannot reach all targets and that its arsenals have since been severely depleted. Washington is therefore attempting to establish its own supply chains for unmanned systems and reduce its dependence on Chinese components. HPQ Silicon could also benefit from this. At its current valuation, the stock is anything but expensive.
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Plug Power: Light and Shadow
While HPQ Silicon’s stock is still waiting for a price jump following the positive news, Plug Power gained about 10% after its quarterly report.
Plug Power made operational progress in the second quarter of 2026. Revenue came in at around USD 178 million, up about 9% from the previous quarter. Notably, the gross margin improved from –31% in the same quarter of the previous year and –13% in the first quarter of 2026 to approximately zero. This was due to a year-over-year reduction in operating costs of about 50% to approximately USD 62 million. Loss per share also decreased. The material handling business performed well, with 1,666 GenDrive units delivered—a 125% increase over the same quarter last year. Service revenue rose by 82% to approximately USD 30 million.
Plug also reports progress in its electrolyser business. Among other developments, the 30-MW Barrow Green Hydrogen project in the UK reached the final investment decision. In addition, the company secured a 275-MW FEED contract in Québec and, after the end of the quarter, a 50-MW contract for an Orica hydrogen project in Australia. In the hydrogen business, revenue rose by approximately 15% to USD 39 million. However, this segment remains significantly unprofitable, with a gross margin of minus 48%.
Across the entire group, Plug is still far from sustainable profitability. Management nevertheless remains committed to the goal of achieving positive EBITDAS in the fourth quarter of 2026 and has raised its full-year revenue growth forecast to 15 to 16%.
Liquidity remains the biggest weakness. At the end of June, Plug had only about USD 162 million in freely available cash, while it burned approximately USD 61 million net during the quarter. Although the cash burn has decreased significantly compared to the previous quarter, the company remains reliant on additional financing. Sales of assets, among other measures, are intended to remedy this situation. Plug aims to raise approximately USD 275 million from the Graham project in Texas, the New York Gateway, and other initiatives. Investors had recently reacted negatively to this announcement.
Siemens Energy: Strong Results Once Again
Siemens Energy appears to be breaking out of the downward trend that began in April. The share is currently trading at around EUR 164.50. At the end of June, it was still at EUR 135. Deutsche Bank Research even believes the share could rise to EUR 210. Following the quarterly report, the price target was raised to EUR 200, and the “Buy” recommendation was reaffirmed. There is currently no sign of overcapacity or price wars.
Siemens Energy further accelerated its growth momentum in the third quarter of fiscal year 2026. Order intake reached a new record of EUR 17.9 billion, driven primarily by Gas Services as well as strong growth at Grid Technologies and Transformation of Industry. The book-to-bill ratio stood at 1.57. The order backlog rose to EUR 162 billion. At the same time, revenue increased by 18.5% on a comparable basis to EUR 11.4 billion.
Earnings before special items more than tripled year-over-year to EUR 1.623 billion. Profit after taxes rose to EUR 1.188 billion, up from EUR 697 million in the same quarter of the previous year. The former problem child, Siemens Gamesa, also posted strong results. The wind business returned to profitability for the first time since fiscal year 2022. At the same time, free cash flow before taxes improved significantly to EUR 2.319 billion.
Siemens Energy confirms its raised forecast for the full year. The company expects comparable revenue growth of 14% to 16% and an earnings margin before special items of 10% to 12%. The company is targeting the upper end of the margin range. Profit after taxes is expected to reach around EUR 4 billion, with free cash flow before taxes at around EUR 8 billion.
HPQ Silicon is getting closer and closer to commercializing its battery technology. Tests are promising, and certifications have been obtained. If the positive news flow continues, the share should also be able to gain significantly. Plug Power remains a stock for speculators. There is a steady stream of positive news, but until the company reaches breakeven, it will likely need at least one more major capital raise. Siemens Energy is performing very solidly from an operational standpoint. However, investors cannot afford any missteps when it comes to valuation.
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