Polestar Automotive (PSNY), once Volvo’s (VLVLY) racing arm, has evolved into one of Sweden’s sleekest electric vehicle (EV) brands. Spun off by Volvo’s parent, Geely (GELYF), in 2017 and taken public through a SPAC merger in 2022, Polestar has steadily carved its place in the EV race. While it’s been quietly gaining traction, on Wednesday, the market finally took notice.
Shares jumped over 17% - from $1.10 to $1.30 - on whispers of a potential U.S.-EU deal that could slash regulatory hurdles for European automakers. Trading volume surged, surpassing the 52-week average. Investors and options traders are piling in, betting on even more upside as Polestar eyes expansion into the American market. Plus, its stellar deliveries are fueling momentum, strengthening the brand’s position in the fiercely competitive EV landscape.
PSNY stock has already rocketed by mid-teens over the past year, and reaching a year-to-date (YTD) high of $1.42 added fuel to the frenzy. Momentum is strong, and optimism runs high. But after such a meteoric spike, is Polestar still a can’t-miss buy, or has the rocket already left the launchpad?
About PSNY Stock
Polestar Automotive, headquartered in Gothenburg, is a premium EV brand. Originally, Gores Guggenheim, a U.S.-based special purpose acquisition company (SPAC), merged with Swedish EV maker Polestar in June 2022, taking the company public under the Polestar name.
Celebrated for its Scandinavian design and performance-driven engineering, Polestar blends innovation with sustainability in the EV space. Its lineup includes the Polestar 2 sedan, Polestar 3 and 4 SUVs, Polestar 5 grand-touring sedan, and Polestar 6 roadster. Beyond vehicles, Polestar offers software, performance kits, accessories, carbon credits, and leasing solutions, positioning itself as a tech-forward leader in the electric mobility revolution.
Valued at $2.4 billion by market capitalization, shares of Polestar Automotive rose 15% over the past 52 weeks as investor sentiment toward EV makers strengthened. In 2025, PSNY’s momentum has accelerated further, gaining 23.8% on a YTD basis. From April lows of $0.84, PSNY has rallied an impressive 54.8%, reflecting renewed confidence in the company’s growth prospects and strategic positioning within the electric vehicle market.
In yesterday’s session, PSNY touched a YTD high of $1.42 before closing at $1.30, up 17.1%. Trading volume spiked to 36.5 million shares from the 2 million shares on Tuesday, indicating aggressive bullish positioning. The 14-day RSI jumped to 77.3, deep into overbought territory.
Polestar trades at just 1.13x forward sales, cheaper than peers, like Lucid (LCID). While the valuation suggests untapped upside, it also reflects investor caution over EV profitability, capital pressures, and competitive intensity in a crowded market.
A Closer Look at Polestar’s Q1 Results
Polestar’s fiscal Q1 2025 earnings, released on May 12, showcased an EV maker hitting the accelerator on growth while tightening its cost base. Revenue surged 84% year-over-year (YoY) to $608 million, fueled by higher car sales and improved margins. Gross margin turned positive at 6.8%, a major leap from last year’s -7.7%, thanks to a richer mix of higher-margin models, though competitive pricing slightly weighed on gains.
Losses remain, but Polestar is narrowing the gap. Net loss shrank 31% YoY to -$190 million, supported by stronger gross profits, fixed-cost reductions, and positive foreign exchange impacts. Even the adjusted EBITDA loss improved 45.7% annually to -$115 million, driven by cost savings from 2024 headcount cuts, optimized marketing spend, and margin expansion, partially offset by joint venture losses in China.
Retail sales volume climbed 76.5% YoY to 12,304 cars, showcasing growing demand for its refreshed lineup.
Polestar’s growth is driven by its expanding and evolving EV lineup. The Polestar 2, the brand’s foundation model, still contributed 31% of Q1 volumes, but the real breakthrough came from the Polestar 4, commanding a massive 49% share. The Polestar 3 followed with around 20%. This shift toward SUVs, which traditionally carry higher margins than sedans, has been a key driver behind Polestar’s improved margin. Launching strong-performing models early has given the company crucial momentum, reinforcing its strategy to scale efficiently in the competitive EV landscape.
Backed by a strong $732 million cash balance, Polestar is shoring up liquidity, securing up to $450 million in term facilities and renewing a €480 million green trade finance facility to support working capital.
Despite geopolitical headwinds, pricing pressures, and scaling challenges, Polestar is executing well. With a growing portfolio, expanding retail network, and accelerating deliveries, Q1 results show it’s steering toward growth while managing costs, steadily positioning itself to compete head-on in the global EV race.
Polestar revved up its growth engine in Q2 2025, delivering an estimated 18,049 cars – a 38% jump from the same quarter last year. Momentum carried through the first half, with retail sales hitting roughly 30,319 vehicles, up 51% YoY. CEO Michael Lohscheller pointed to this surge as proof that Polestar’s retail expansion is hitting the mark, even amid challenging market and geopolitical conditions, more customers are turning to the Swedish EV brand. Strong quarters like this suggest Polestar is not just keeping pace, it is accelerating.
Despite pausing its 2025 financial guidance, management reaffirmed an ambitious 30% to 35% annual growth target between 2025 and 2027, underscoring its confidence in scaling operations and capturing a larger slice of the fast-growing EV market.
Polestar’s road ahead looks anything but smooth, yet the journey is far from stalled. Analysts expect fiscal 2025 losses to narrow to -$0.56 per share, improving 42% YoY, with revenue projected around $3.2 billion as deliveries climb. But the twist comes in fiscal 2026, where losses are forecasted to widen to -$0.61 per share, the company’s top-line growth is set to accelerate, nearly doubling to $6.7 billion.
What Do Analysts Expect for PSNY Stock?
Wall Street’s view on PSNY stock is mixed but tilts bearish. The consensus rating on the PSNY remains at “Moderate Sell,” from the five analysts covering it. Three advise a “Hold” rating, while two recommend a “Strong Sell.”
Despite the cautious stance, PSNY’s recent rally has pushed its price above the mean price target of $0.97. However, the Street-high target of $1.50 leaves room for a potential 15.4% upside if bullish momentum sustains, making Polestar a stock caught between skepticism and speculative optimism.
Final Thoughts on Polestar Automotive
Polestar stands at an intriguing crossroads in the EV race. With a 60-month beta of 1.41, volatility and sharp price swings are an inherent part of its journey.
Despite growing deliveries and a relatively lower valuation, sustaining production momentum and investor confidence remains uncertain. Intense EV competition, pricing pressures, and shifting market dynamics make the road ahead tricky.
Polestar’s fundamentals offer potential, but without clear catalysts, upside could be limited. For now, caution may be wiser than chasing the rally.
