QuantumScape Corp. (QS) experienced a significant 24-hour plunge of 5.07% on Thursday, despite reporting better-than-expected second-quarter earnings and announcing an expanded collaboration with Volkswagen's battery maker PowerCo. The sharp decline comes as investors appear to be taking profits following the stock's recent surge, which saw it more than double in value over the past month.

The solid-state battery technology developer posted a loss of $0.20 per share for Q2, narrower than the $0.25 loss reported in the same quarter last year and slightly better than analysts' expectations of a $0.21 loss. QuantumScape also announced an amended agreement with PowerCo SE, a subsidiary of Volkswagen Group, which will contribute up to $130.7 million over two years to support joint development and commercialization activities for its QSE-5 solid-state lithium metal battery technology. Despite these positive developments, the company narrowed its full-year guidance for adjusted EBITDA loss to a range of $250 million to $270 million, which may have disappointed some investors hoping for more significant improvements.

The stock's decline should be viewed in the context of its recent performance as a "meme stock." QuantumScape shares had surged over 200% in the past month prior to the earnings release, driven largely by speculation and increased retail investor interest. This rally was part of a broader resurgence in meme stocks, reminiscent of the phenomenon seen in previous years with companies like GameStop and AMC Entertainment.

As QuantumScape continues to develop its innovative battery technology, investors and analysts will be closely watching for further progress in commercialization efforts and strategic partnerships. The company's extended cash runway guidance into 2029, a six-month improvement over previous projections, provides some reassurance about its long-term prospects. However, the stock's volatility highlights the ongoing challenge of balancing technological promise with market expectations in the rapidly evolving electric vehicle battery sector.