Investors have once again taken notice of electric charging solutions provider Blink Charging Co. (NASDAQ: BLNK)’s triple-digit sales growth. Potential shareholders, on the other hand, should be aware of some of the company’s dangers.
BLNK operates in a favorable environment: interest in electric vehicles is growing, and the rising expense of traditional energy carriers may push this trend even more.
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In this context, Blink Charging Co.’s (BLNK) revenue increased by 339 percent to $9.8 billion in the most recent quarter, owing to a rise in the number of sold and installed charging stations.
BLNK stock more than quadrupled its number of stations in the past quarter, from 17,302 in Q1 2021 to 36,337 in Q1 2022. The purchase of Blue Corner, a European charging operator for electric vehicles, accounted for around 41% of overall revenue growth.
However, growing losses are a problem for Blink Charging. Electric car charging stations are now finding it challenging to make a profit purely from the sale of power. Government grants and subsidies account for a considerable portion of the profits.
In the first quarter, Blink Charging Co. (BLNK) received $3 million in grants. Since January 2021, the firm has received $30 million in government subsidies and refunds. Blink Charging lost over $15 million in the first quarter, which was more than the entire quarterly profits.
At the same time, the firm has already achieved a gross profit. As a result, the company’s substantial reliance on government handouts poses a danger. However, if Blink Charging Co. (BLNK) can extend its network before government subsidies expire, it may be able to profit from the growing electric car industry in the long term.
The stock of Blink Charging Co. (BLNK) is now trading 46.62 percent below its three-month high. On the other hand, the stock is trading 15.72 percent higher than its three-month low. Looking at the bigger picture, BLNK is now trading 46.62 percent below its 52-week high and 15.72 percent above its 52-week low.