You've been at Plug for 12 years, the majority of that time leading the company's commercial efforts. What could you provide as an internal CEO that an outsider could not have?
When I joined Plug, we were about $27 million in sales, and last year we hit $710 million. I've seen that progress little by little, getting every single order that got us there. When the board started looking at who should follow Andy's steps, the question was whether to bring somebody from outside or somebody who understands what we have been doing for the last 18 months and is able to continue executing. Plug started a huge effort in 2023 when it was clear that the hydrogen industry was not going to live up to the expectations set by the Biden administration. We had made an incredible investment, four to five billion dollars, and we needed to reset. Under Andy's direction we created Project Quantum Leap, and in 2024 and a good part of 2025 the project began to provide the results we were looking for.
A big part of our execution success is going to be associated with converting the really big pipeline of projects into actual orders. The team concluded we needed somebody with a commercial mindset running the company, because filling the factories is key to growth. We have a factory that can produce two gigawatts of stacks. Nobody else has a factory that can do that today for electrolyzers, and we are not fully utilizing it, which puts pressure on margins because the fixed cost gets distributed across whatever you produce. To fix that you need more orders. I put the current strategy together with Andy and the rest of the management team, so I understand it well. Since the announcement in October, when I started taking over CEO functions, the results have followed: Q4 2025 was meant to be margin neutral and came in slightly positive, and Q1 2026 grew the top line by 22 percent year over year. This is what we needed, continuity, not disruption.
Project Quantum Leap has clearly delivered, and that is reflected in earnings and stock performance. What is the single hardest cost line you have had to attack in the past few months?
When you look at our equipment sales, we can make money, especially when we get to volume. This quarter, if I remember correctly, GenDrive had a 30 percent margin. We can make money on building and shipping things. Where we have had historical issues on the margin side, is on services. We put a services program in place a few years ago, even before Quantum Leap, and that program is now beginning to show that we can do to services with margin. If you look at the numbers this quarter, the margins for services are outstanding. They're being helped by some accounting adjustments, but even if you take those out, you go from 70 percent to roughly 35 percent. That is still a remarkable shift when you consider we were losing hundreds of millions of dollars on services in the past. This is the second quarter we have been able to do that, so the trend is good.
The line that is my main focus right now is hydrogen. We are still not in positive territory there. If you compare Q1 2025 to Q1 2026, we have improved the margin by 50 percent, but it remains negative by a wide gap. That is the piece I am spending a lot of time on with the team. There is also PPA, which we are cleaning up, but that is more a financial execution exercise with a clear path. Hydrogen is the most challenging one. If we get hydrogen right, our margins are going to be positive all along, and that is what I am most focused on.
Material handling is profitable, electrolyzers are scaling fast, hydrogen production is still expensive. If you had to pick one to define Plug five years from now, which is it?
What we are doing between now and 2030 is getting the company to the financial results we want in the next couple of years. At the same time, we are solidifying the electrolyzer technology as something that can be produced in volume and can produce hydrogen at low cost and green using renewables, through the refinery and fuel production projects we have underway. We are positioning ourselves for the directives coming from the EU, and here in the US the situation is not as bad as people assume it is for renewables.
Looking further out into the 2030 decade, when you have a grid that is mainly renewables, which is where we are going (Spain is very close to that already), you have intermittent supply. Today peakers are natural gas turbines, which are expensive and not green. Electrolysis can become a dynamic load for the grid: when you have extra power from wind or sun that would otherwise be curtailed, you put that load on the grid and turn surplus electrons into hydrogen. Remember, we are in 2030+ now, sixty to seventy percent of the cost of the molecule is electricity, so if the electron is essentially free, the efficiency of the electrolyzer becomes a secondary concern. You can store hydrogen in salt caverns, like natural gas, and use it through fuel cells to cover peaks, or shift it seasonally from winter to summer. Batteries cannot do that. Hydrogen, as far as I can tell, is the only way to mimic that application on a clean grid.
The hydrogen credit rules came out narrower than the industry wanted. With the current tax credit environment, how much of your domestic project pipeline survives?
When the prior administration came in, everybody got extremely excited that hydrogen was going to be the next big thing. The industry worked hard to get hydrogen into the Inflation Reduction Act, and we succeeded. Then it was sent to the DOE for regulation, and the DOE looked at the Europeans and brought in the three pillars. They came too narrow. Our calculations showed that complying with the pillars would add five dollars per kilo while the credit was only three dollars. So nobody moved. The Europeans are now rethinking their RFNBO rules for the same reason: their rules are choking the growth of the industry, and hydrogen is becoming more relevant for energy security and independence. They are working on relaxing those rules so the sector can grow faster and reduce dependence on natural gas from the Middle East or Russia. Back in the US, by the time the Biden administration figured out something had to change, Trump had won.
Everybody assumed that was the end of it, but we have worked with Republican and Democratic administrations for years, and hydrogen has appeal across the aisle. The proof is that in 2026 this administration renewed the ITC, the Investment Tax Credit. Every customer that buys a fuel cell, Amazon, Walmart, Home Depot, BMW, gets a 30 percent tax credit. If Amazon spends 10 million on a site, they save three million in taxes. That had lapsed under Biden, and the Trump administration brought it back. As of January 2026 it is already helping us grow the material handling business. On the PTC, the assumption was it would be cut, but representatives from red states convinced Congress and the administration to keep it through the end of 2027. The hubs are also back in play, with seven billion dollars largely in red states because those representatives see hydrogen creating jobs and energy independence. Our plants in Georgia and Tennessee are in red states. The energy transition will take decades, and short-term swings are part of the process. In 2025 the industry grew 13 percent when people said it would not grow at all, and I am predicting growth for 2026.
Q4 2026 positive EBITDA is an important deadline. What happens if you miss it, and what does success mean for the American hydrogen story?
We have a solid plan to meet that goal. It matters because goals are how you measure progress. Whether we come in slightly over or slightly under, what matters is the trajectory. If we were grossly away from the target, that would be something we would have to manage, but that is not how I operate. Being Spanish, we are very direct, and I do not say things I do not believe I can deliver. We have a plan to hit EBITDA positive in Q4 and we are planning to hit it.
Whether we land exactly on it or close to it, it is going to show progress in the environment we just discussed. It proves the industry keeps moving forward, maybe not exponentially today, but consistently, and that hydrogen remains a key piece of the energy transition. We are going to make it. I do not think we will need to have the conversation about missing it.
The IEA recently changed its view on hydrogen's near-term relevance. Setting aside the energy transition, this technology seems increasingly relevant in an energy addition scenario. How do you expect the industry to evolve over the next five to ten years?
I am not sure that report fully accounts for what is happening geopolitically today, especially on the energy side. Ukraine was the first real scare for Europeans, and Europe is a huge energy consumer. Now you have the Strait of Hormuz situation. Six months ago, when I was visiting customers in Europe to discuss how RED3 and the EU directives were shaping their decisions, the push from companies like Iberdrola, BP, and Galp was mainly on transport and refineries. They wanted refineries using a certain percentage of green hydrogen by 2030. That is why we have the 25 megawatt project in Spain with BP and Iberdrola, the 100 megawatt project with Galp in Portugal, and other refinery projects across Europe.
The other parts of the European directives, refuel aviation and refuel maritime, were there in regulation but not being transposed into national law. So eSAF projects were moving slowly. A month ago that changed. I started getting calls from our eSAF projects saying Accelerate EU is reinforcing refuel aviation because SAF is becoming scarce. We are using reserves. If the Strait of Hormuz does not reopen in the coming months, Europe will face availability issues, and Asia is already there, with airlines cancelling flights because they do not have fuel. There is now a law pushing this cannot happen again in the next three or four years, accelerating eSAF projects. eSAF is hydrogen plus CO2, a completely independent way of generating aviation fuel that delivers energy independence and security.
Between now and 2030, you are going to see a lot of push for this in European and Asian markets. If you have water, sun or wind, and a source of CO2, you can produce fuel. That is where this is going.
