Plug Power surges on green hydrogen supply deal with Amazon
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Plug Power (NASDAQ:PLUG) +14.4% pre-market on Thursday after agreeing to supply liquid green hydrogen to Amazon (AMZN) starting in 2025 to help decarbonize the latter's operations.
As part of the deal, Plug (PLUG) grants Amazon a warrant to acquire up to 16M common shares, with an exercise price for the first 9M warrant shares of ~$22.98/share, and for the rest a price equal to 90% of Plug's 30-day volume weighted average share price when the first 9M shares are vested.
Amazon (AMZN) would vest the warrant in full if it spends $2.1B over the seven-year term of the warrant across Plug products, including electrolyzers, fuel cell solutions and green hydrogen.
Plug (PLUG) said the Amazon deal, which will supply 10,950 tons/year of liquid green hydrogen beginning January 2025, is a "growth opportunity" that is expected to help it reach its $3B revenue goal by 2025.
Amazon (AMZN) said the contract should provide enough annual power for 30K forklifts or 800 heavy-duty trucks used in long-haul transportation.
Other alternative energy names are indicated higher in the pre-market, including FuelCell Energy (FCEL) +7%, Ballard Power (BLDP) +6.6% and Bloom Energy (BE) +6.1%.
Plug Power (PLUG) recently reported a larger than expected Q2 loss but Wall Street analysts remained positive on the longer-term outlook for the company.