What happened
Shares of electric vehicle (EV) charging network provider ChargePoint Holdings (CHPT 1.57%) are dropping sharply Wednesday. As of 2 p.m. ET, the stock was down 6.2% after recovering a bit from an earlier 8.2% decline.
So what
The move lower coincides with a broadly lower day in growth and technology stocks. The Nasdaq Composite index was leading markets lower with a decline of about 1.25% at that time. But the drop in ChargePoint stock comes even after the company announced it is expanding its presence in Europe with a new business venture. The decline in ChargePoint shares pushed the stock into negative territory for the year.
Now what
ChargePoint said it is partnering with French car-leasing company ALD Automotive to launch an EV charging business in Europe. ALD -- which is majority owned by banking giant Societe Generale -- said the new Paris-based business will begin operating in the fourth quarter.
Its goal is to provide an app-based system for fleet drivers and managers to monitor and control charging expenses for their electric vehicle fleets. It will be based on ChargePoint's charging platform and will provide drivers access to 485,000 charging ports across Europe. The business will also provide a charging payment card for customers.
ChargePoint and ALD have previously worked together, and the new venture plans to expand beyond France to nearly a dozen other European countries in approximately the first year after its launch.
Image source: Getty Images.
ChargePoint has been growing simultaneously in North America and Europe. It already operates in 16 European markets and this new business should further grow its revenue from those markets.
The charging network company grew both its fourth-quarter and full fiscal year 2023 revenue by more than 90% year over year for the periods ended Jan. 31, 2023. That growth hasn't yet turned the company profitable, however. That is the catch for investors looking for safer places to invest right now, and helps explain today's stock action as investors moved into more defensive investments. Longer-term outlooks might see the drop as an opportunity to speculate on a leading charging company that continues to show strong growth.
