Forgent Power Solutions (FPS) Q2 2026 earnings summary

Executive summary

• Q2 2026 revenues rose 69% year-over-year to $296 million, driven by strong demand in data center and grid markets and successful production ramps at new facilities.

• Bookings/orders surged 268% year-over-year, with backlog doubling to $1.5 billion, supported by broad-based growth in data center and grid markets.

• Adjusted EBITDA increased 51% to $60 million, with margin at 20.4%, impacted by temporary 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 in net proceeds, used to purchase interests in its operating subsidiary and redeem interests from existing owners.

Financial highlights

• Q2 2026 revenues were $296 million (+69% YoY), all organic growth.

• Adjusted EBITDA was $60 million (+51% YoY), margin 20.4%.

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

• Gross profit for the quarter increased 60% to $101.8 million.

• Powertrain Solutions revenue more than tripled to $46 million, now 16% of total revenues.

Outlook and guidance

• FY2026 revenue guidance: $1,275–$1,325 million, representing 73% year-over-year growth at the midpoint.

• Adjusted EBITDA guidance: $300–$310 million (+80% YoY), margin expanding to 23.5%.

• Adjusted Net Income guidance: $190–$200 million (+120% YoY).

• Margin expansion expected in Q3 and Q4 as new hires reach productivity and startup costs roll off.

• Majority of current backlog expected to convert to revenue within 12 months.