Kempower's Road Ahead: DC Fast Charging and the EV Revolution

Emily Carter

Welcome to the Global Equity Research podcast from Softgate Capital Research. I'm Emily Carter, and with me is David Mitchell. Today, we're diving into Kempower, a company that's making serious waves in the electric vehicle charging world, especially with its DC fast charging systems. If you're just joining us, we've covered everything from the EU Green Deal to Aston Martin's push into electrification lately, so today continues that theme of innovation and transition. A quick primer: Kempower started in Finland back in 2017, spun out from a pretty established equipment firm. They listed on Nasdaq Helsinki in 2021, and right now they've got an €18 target price. So, David, want to set the scene for Kempower's current market standing?

David Mitchell

Sure thing, Emily. Kempower's carved itself a pretty interesting niche by focusing almost exclusively on DC fast charging. What’s unique here—compared to say, the ABBs or ChargePoints—is their highly modular, software-driven hardware. We're talking high power, multiple simultaneous outputs, dynamic load balancing... It's all about flexibility, which is critical for things like fleet depots or rapid charging hubs. Their main differentiator is really this mix of reliability and tailored charging solutions. Plus, they've won praise for top-tier customer experience and service—something you actually hear echoed a lot across EV operators and charging fleet managers. So, it's not just about hardware; it's how that hardware fits into the broader ecosystem of electrification.

Emily Carter

Exactly. And let's not forget: Kempower's revenue base is still very much Europe-centric, but they recently opened up a new manufacturing site in North Carolina. That feels like a big hint at where they're headed. Plus, they've got a transparent ESG profile—over 60% of revenue tied to products with a sustainability classification. That definitely catches the eye of municipal and fleet clients looking to decarbonize. It's a true combination of Nordic roots and a pretty bold global ambition.

David Mitchell

Now, the financial story—it's been... well, honestly, a bit of a rollercoaster. Kempower posted a wild 100% CAGR on revenue from 2020 to 2023, then ran into a real speed bump in 2024. For hardware-heavy cleantech, that pattern isn’t actually unusual, right? You build fast, then you kind of trip on supply chains, project timings, or—as seems to be the case here—customer installation delays. Emily, what’s your read on what this 2024 reset tells us about scaling hardware in this space?

Emily Carter

Yeah, this setback in 2024 is a classic scaling headache! Their orders actually stayed robust, but revenues took a hit—partly because customers staggered when their charging sites went live. So, you end up with strong backlog, kind of like the company's future business is still locked in, but the short-term P&L looks rough. Looking at the data, order intake in 2023 skyrocketed to €274 million, up from €106 million in 2022. So clearly demand's there! But margins shrunk, and EBIT even went negative in the first half of 2024. Management pitched this as a timing artifact—installations and revenue just failed to sync up as neat as they'd hoped.

David Mitchell

Right, and I think it’s important to note that they've already begun rebounding. By Q3 2025, quarterly revenue was back up at €73.7 million, though still not quite at the 2023 pace. The key thing? Backlog numbers stayed high, hovering around €80-110 million through 2024. That signals the underlying demand isn't just a flash in the pan. It's more about Kempower learning how to pace itself as a public company dealing with long deployment cycles. In cleantech hardware, you live and die by project timelines. So, some of these growing pains are, frankly, the price of ambition.

Emily Carter

And as management says, if you strip out the weirdness in project timing, the structural growth story is still intact. Speaking as someone who’s watched a few hardware companies flame out after overextending, it’s refreshing to see Kempower acknowledge those limits and recalibrate before things get nasty.

Emily Carter

Let's dig into where the money actually comes from. Kempower’s revenue is mainly from Europe, but North America’s expected to get a much bigger slice with that North Carolina site. For now, over 85% of revenues are still coming from Europe—especially large fleet operators and depot projects in Norway and Sweden. As of 2025, heavy-duty trucks and buses are a growing piece of the pie. David, how does this revenue mix shape their profitability profile?

David Mitchell

Yeah, Europe has been profitable sooner because of scale, but North America’s still ramping up—so margins lag. A big driver for future margin lift is the transition to more software and services, not just hardware. As their U.S. expansion takes off, operating leverage should improve. On fleet operations—since you mentioned it, there’s a lot of buzz about Kempower’s reliability. Fleet operators consistently say these chargers just work. Less downtime, fewer site visits for maintenance. And the software, like their charging management and dynamic load balancing, simplifies life for fleet managers. It’s subtle, but those service contracts and software subs could be a hidden contributor to future EBIT.

Emily Carter

That's huge! If you look at competitors, a lot of them depend almost solely on hardware revenue. Kempower's actually diversifying, even if the ratios are still hardware-heavy for now. With more software baked in, gross margins could eventually recover above that 50% target. So, reliability isn't just a marketing point; it nudges up those recurring revenues and keeps fleet customers sticky. That foundation matters as they scale outside Europe and go up against bigger names globally.

David Mitchell

Turning to valuation—Kempower’s recent performance has caught a lot of eyes. Is that €18 target price justified? The company trades at more than 3x sales on 2025 estimated revenue, which is, well, pricey compared to some larger, slower-growing industrials. On the flip side, it makes sense when you look at the growth. For a lot of investors, the question comes down to: does Kempower deserve this premium, or is the execution risk still too high for comfort?

Emily Carter

I lean toward the premium being justified—at least for now. It's rare to find such fast top-line growth and a legitimate shot at profitability in a capex-heavy sector. Peers like ABB’s e-mobility business or ChargePoint get trading multiples around three to four times sales, but Kempower’s unique product modularity and market flexibility stand out. Their mix of high double-digit growth, robust backlog, and, hopefully, a return to positive, high-single-digit operating margins—those all support a higher multiple if they can keep delivering.

David Mitchell

But, and this is the hard part, there’s definitely real risk. It’s one thing to snag market share when you’re small and nimble; it’s something else to prove you can deliver profits year in, year out as you get bigger. In this segment, historical volatility makes some investors nervous—especially after 2024’s dip. For me, the proof comes in seeing North America become a growth driver and margins ticking back up. Until then, I'm cautiously optimistic—but if the next couple quarterly results miss expectations, that premium could evaporate fast.

Emily Carter

Zooming out, Kempower’s part of a much larger global EV charging boom. Governments want more DC fast chargers up and running to meet ambitious EV targets, and in the U.S., federal funding is rolling out for depot and long-distance corridor charging. Policy tailwinds are strong, but competition is fierce. So, David, how do you see Kempower stacking up strategically?

David Mitchell

From a tech perspective, dynamic load balancing is the secret sauce, especially for fleet depots juggling dozens of vehicles charging simultaneously. Kempower was an early mover here, so it could give them an edge as new regulations push operators to maximize grid efficiency. But it’s not just about hardware anymore—the shift is toward integrated ecosystems. Their software, UX, and modularity are all positives, but scaling costs and bigger fish like ABB or Siemens are looming. SWOT-wise, Kempower’s strengths are their innovative modular tech, customer satisfaction, and ability to scale quickly within focused segments. On weaknesses, I'd say size is the main issue—they're still relatively small, so supply chain snafus or execution missteps could hurt disproportionately.

Emily Carter

Absolutely. And they’ve got opportunities galore with global adoption of EVs, expansion into new transport modes—buses, heavy trucks, even marine, eventually. But threats, I mean, those are real too. As China’s big EV charger factories ramp up, price competition could get nasty. There's a risk some of Kempower's engineering edge gets commoditized if major contracts just go to the lowest bidder. That said, their customer-centric approach is hard to copy fast, and if they keep innovating in software and UI, they might stay nimble while the giants chase scale.

Emily Carter

So, to wrap all this up—Kempower is a story of a Nordic innovator balancing rapid growth with the medicine of strategic resets. They’ve got one foot firmly in Europe, but their sights are set way farther—especially with the U.S. expansion and a growing slice of fleet and software revenues. The risk is always execution—can they outgrow their pains, or does scale dilute what made them special? Either way, it’s one of the most fascinating public stories in EV infrastructure right now.

David Mitchell

Yeah, I’d say keep your eyes on U.S. contract wins, operating margin recovery, and any uptick in software and services—those are the signposts for whether Kempower’s thesis holds up. As always, folks, this podcast is for informational purposes only—not investment advice. Everything we've discussed is based on sources believed to be reliable, but no guarantees on accuracy or completeness. If you want the full legal boilerplate, rewind that last bit or check the episode notes from Softgate Capital Research.

Emily Carter

Couldn’t have said it better, David. Thanks to everyone for listening—we’ll be back soon with more deep dives into the companies shaping tomorrow’s markets. Take care, David!

David Mitchell

Thanks, Emily. Always a pleasure. See you all in the next episode. Bye now.