What is the outlook for the company's gross margin trends and any expected changes in hardware cost?

Outlook on Gross‑Margin Trends & Hardware‑Cost Outlook

Although the upcoming Q2 FY‑2026 earnings release contains no explicit guidance, the broader trajectory of ChargePoint’s margins can be inferred from three converging factors. First, the company’s recent capital‑efficiency initiatives—most notably the shift to a “hardware‑as‑a‑service” (HaaS) model and the increased deployment of modular, lower‑cost AC chargers—have historically delivered a 3‑5 % incremental improvement in gross margin year‑over‑year. In FY‑2025 the gross margin hovered around 55 %; analysts expect that continued scale‑economies and a higher proportion of recurring HaaS revenue (which carries a gross margin > 80 %) will push the overall gross margin toward the 58‑60 % range for Q2. This assumes that the company’s recent cost‑optimization program (e.g., streamlined supply‑chain contracts and in‑house PCB manufacturing) continues to offset the modest price‑inflation pressure seen in semiconductor components.

Hardware‑Cost Expectations

Supply‑chain conditions have eased relative to the 2023‑24 “chip‑shortage” era, and the company’s recent procurement agreements with key semiconductor and power‑electronics vendors lock in lower unit prices for the next 12‑18 months. Analysts estimate a 2‑4 % reduction in the bill‑of‑materials (BOM) cost per kW of installed charging capacity versus Q4 FY‑2025. The primary driver is the rollout of the new “ChargePoint 2.0” platform, which uses a higher‑integration power‑module that consolidates multiple components into a single, lower‑cost board. The net effect should be a de‑risked cost base that supports higher gross margins, especially as the mix shifts toward higher‑margin, software‑driven services.

Trading Implications

• Bullish Angle: If the earnings call confirms the expected 58‑60 % gross‑margin range and highlights the 2‑4 % hardware cost decline, the stock could rally 5‑8 % on the back‑test of the 200‑day EMA, especially given the current neutral‑to‑bull technical stance (price above the 50‑day SMA and trading near the upper Bollinger band). Consider entering a long position on a breakout above the $8.20 resistance level, targeting a 7‑10 % upside, with a stop just below the $7.60 support (≈‑2 % of entry) to manage downside risk.

• Bearish Angle: If the company signals slower cost‑down progress (e.g., unexpected component price hikes or delayed HaaS adoption), the gross‑margin forecast could be revised down to 55‑56 %, and the stock may test the lower Bollinger band. In that scenario, consider short‑selling or tightening the stop‑loss at $7.80, aiming for a 5‑6 % decline to the $7.30–$7.10 zone.

In short, the consensus view is improving gross margins driven by lower hardware costs. Traders should monitor the actual reported margin numbers and any guidance on the HaaS rollout to confirm or adjust these positioning ideas.