Forgent Power Solutions (FPS) Q2 2026 earnings summary

Executive summary

• Q2 2026 revenues rose 69% year-over-year to $296–$296.4 million, driven by strong demand and market share gains in data center, grid, and industrial segments, with new manufacturing campuses coming online.

• Bookings/orders surged 268% year-over-year, with backlog doubling to $1.5 billion and up 45% sequentially.

• Adjusted EBITDA increased 51% to $60–$60.4 million, with a margin of 20.4%, impacted by under-absorbed labor and overhead from rapid hiring and facility expansion.

• Net loss for the quarter was $0.1 million, mainly due to a $10 million write-off of deferred financing costs from refinancing activities.

• The company completed its IPO in February 2026, raising $491.8 million to $1.7 billion in net proceeds.

Financial highlights

• Six-month revenues grew 76% year-over-year to $579.7 million, with net income of $15.5 million, up 12%.

• Gross profit for Q2 increased 60% to $101.8 million, while cost of revenues rose 74% due to higher material, labor, and overhead costs.

• Adjusted Net Income for the quarter was $35.5–$36 million, up 66% year-over-year.

• SG&A expenses more than doubled to $68.1 million, reflecting increased headcount and public company costs.

• Interest expense for the quarter was $21 million, up from $13.7 million, mainly due to refinancing.

Outlook and guidance

• FY2026 revenue guidance: $1.275–$1.325 billion, representing 73% year-over-year growth at the midpoint.

• Adjusted EBITDA guidance: $300–$310 million, up 80% year-over-year at the midpoint.

• Adjusted Net Income guidance: $190–$200 million, up 120% year-over-year at the midpoint.

• Margins are expected to expand sequentially in Q3 and Q4 as new hires reach productivity and startup costs roll off.

• Management expects continued strong demand from data center and grid customers, supported by ongoing capacity expansion and new product introductions.