Shares of QuantumScape Corp. (QS) plummeted 12.79% in intraday trading on Wednesday, as investors braced for the company's third-quarter earnings report scheduled after the market close. The significant drop comes on the heels of a recent rally that saw the stock hit a new 52-week high last week.

The pre-revenue company, which is developing next-generation solid-state batteries, has been riding high on investor optimism fueled by China's new export licensing on critical battery materials. This development highlighted the strategic importance of US-based alternatives in the battery sector. However, as the earnings report approaches, investors appear to be reassessing their positions.

Analysts expect QuantumScape to report a loss of 20 cents per share, which is typical for a tech company in its development phase. The focus of the earnings call will likely be on updates regarding technological milestones, progress with automotive partners, and the company's path to commercialization. These factors are crucial in justifying QuantumScape's multi-billion dollar valuation amid the speculative fervor surrounding the stock.

Despite the sharp decline, QuantumScape's stock remains above its 50-day moving average of $11.49 and significantly above its 200-day moving average of $7.06, suggesting that the longer-term bullish trend may still be intact. However, today's pullback indicates that investors are cautious ahead of the earnings release, which could provide critical insights into the company's future prospects in the competitive electric vehicle battery market.