Array Technologies, Inc. (ARRY) | The Buildout — AI Infrastructure
The Verdict
Array Technologies designs and manufactures utility-scale solar trackers, fixed-tilt racking, foundations, and related software. Its products sit between steel and component suppliers and the developers and EPCs building large solar plants; AI-driven data center electricity demand is one reason U.S. utility-scale solar projects are growing, and Array supplies the mounting hardware those projects need.
| Market Cap | — |
| Revenue (TTM) | $1.2B |
| Revenue Growth | +13.2% |
| EBITDA Margin (TTM) | 8.6% |
| Net Debt | $562M |
| Earnings Beats | 5 of 7 |
| P/E (TTM) | — |
| EV/EBITDA (TTM) | — |
What We Like
- Record order book of $2.5 billion, up 37% YoY, with trailing 12-month book-to-bill of 1.5x and over $500 million of Q2 gross bookings.
- Over 95% domestic order book, roughly 50% Tier 1 customers, and about half tied to developer, IPP, or utility specifications.
- Products launched since 2023 now account for roughly half of the order book and nearly half of 2026 revenue; software revenue doubled year-to-date.
- OmniTrack backlog overtook DuraTrack for the first time in Q1 2026, and the new Atlas suite targets the >$1 billion traditional foundation market.
- APA year-to-date book-to-bill is over 1.5x, Q1 APA order book rose 50% QoQ to about $150 million, and average pipeline project size has more than doubled since acquisition.
What We’re Watching
- Section 232 rule language was pending as of the Aug 5 call; new steel-content duties could hit the primary input.
- Q4-heavy plan: H2 revenue is roughly 60/40 between Q3 and Q4, requiring a Q4 above $500 million if the full-year midpoint is hit.
- Higher H2 international mix and one-time benefit roll-off are expected to dilute margins; STI gross margin was −37.4% in Q1 2026.
- Preferred dividends flip to cash pay in Q3 2026; roughly $12 million expected through year-end, with a coupon that steps 50 bps annually.
The demand thesis is strengthening on order-book and margin execution, but the timing thesis is not yet proven. Management raised full-year margin and profit guidance while holding revenue, and the record book is explicitly conservative; against that, cash conversion was cut roughly in half on Q4 collections timing. The open question is whether the Q4 revenue plan converts and collects as modeled.
Earnings Beat
Q2 2026 revenue was $342.1 million, above the $300–320 million guide and up 53% sequentially, with adjusted gross margin of 30.8% and adjusted EBITDA of $63.3 million. GAAP gross margin was 29.1%, and net income to common stockholders was $8.4 million.
| Metric | Q1 FY2026 | Q4 FY2025 | Q1 FY2025 | YoY |
|---|---|---|---|---|
| Revenue | $223M | $226M | $302M | −26.1% |
| Gross margin | 28.2% | 8.6% | 25.3% | +290bps |
| EBITDA | $20M | −$31M | $37M | −45.8% |
| EPS | $0.01 | $-0.95 | $0.11 | −88.0% |
| Order book | $2.5B | $2.4B | n/a | +37% YoY |
| TTM book-to-bill | 1.5x | 1.3x | n/a | — |
The first half margins are to be commended at, I think, 30.8% on average. However, they’re not to be fully extrapolated. In the first half, we had a few one-time items, particularly in Q1, that should be adjusted out, and they account for roughly 200 basis points of that. So you’re looking at a normalized 28.8% for H1.— Keith Jennings, Chief Financial Officer, Aug 5, 2026
Management tone: Management was confident, execution-focused, and technically specific. They answered directly on backlog conversion and the H2 margin bridge, but declined to quantify held-out international orders or 2027 margins, and declined to comment on Section 232 until the rule language was published.
Management Guidance
FY2026 revenue was reaffirmed at $1.4–$1.5 billion. Adjusted gross margin was raised to 27%–28% from 26%–27%, adjusted EBITDA was raised at the low end to $210M–$230M, and adjusted EPS was raised at the low end to $0.68–$0.75. Q3 2026 revenue is guided to $310–330 million, with H2 shape roughly 60/40 between Q3 and Q4. Updated guidance excludes any expected AWM contribution, and full-year FCF conversion is expected at 20–25% of EBITDA.
Trajectory
Quarterly revenue was $223.4 million in Q1 2026 and $342.1 million in Q2 2026. The Q1 decline from $302.4 million a year earlier was entirely STI — Legacy grew slightly to $217.4 million — while Q2 rebounded 53% sequentially on domestic tracker pull-forward and APA growth. Adjusted gross margin printed 30.7% in Q1 with more than 300 bps of one-time help, then 30.8% in Q2 with under 50 bps of one-time impact. Management's H2 bridge expects one-time roll-off, higher international mix, and commodity/logistics costs to pull the full-year margin toward the 27–28% guide.
The Model
The model projects FY+1 revenue of $1.5 billion and EBITDA of $200 million, a 13.3% margin. FY+2 steps to $1.9 billion in revenue and $285 million of EBITDA, a 15.0% margin. Near-term revenue is anchored by the $2.5 billion order book and management's expectation that about 80% converts over the next six quarters; FY+2 is driven by continued new-product mix and APA/AWM balance-of-system expansion.
| Metric | FY2025 | Next FY (E) | Following FY (E) |
|---|---|---|---|
| Revenue | $1.3B | $1.5B | $1.9B |
| YoY Growth | — | +16.8% | +26.7% |
| EBITDA | $121M | $200M | $285M |
| EBITDA Margin | 9.4% | 13.3% | 15.0% |
Projections are the median of 5 independent model runs. The model’s revenue sits 18.5% above analyst consensus.
FY2026 revenue was reaffirmed at $1.4–$1.5 billion. Adjusted gross margin was raised to 27%–28% from 26%–27%, adjusted EBITDA was raised at the low end to $210M–$230M, and adjusted EPS was raised at the low end to $0.68–$0.75. Q3 2026 revenue is guided to $310–330 million, with H2 shape roughly 60/40 between Q3 and Q4. Updated guidance excludes any expected AWM contribution, and full-year FCF conversion is expected at 20–25% of EBITDA.
What Could Go Right — and Wrong
- Order book conversion holds at the stated 80% over six quarters, supporting the FY+1 revenue base.
- AWM closes in Q3 2026 and contributes year-one accretion before synergies.
- New products launched since 2023 continue gaining mix share from roughly half the order book and nearly half of 2026 revenue.
- APA sustains year-to-date book-to-bill above 1.5x and first-half revenue 17% ahead of 2025.
- Atlas products capture 45X credits and target the >$1 billion traditional foundation market.
- Q4-heavy plan slips on permitting, site readiness, interconnection, weather, or customer timing, pushing revenue below the full-year midpoint.
- Section 232 final rules impose new steel-content duties, raising input costs or depressing project demand.
- Higher H2 international mix dilutes margins while STI remains at negative gross margin; STI was −37.4% in Q1 2026.
- AWM integration stalls: closing delay or accretion shortfall undermines the balance-of-system template.
- Competitors bundle full balance-of-system offerings and take specification wins.
Looking Ahead
The next twelve months hinge on three named signposts: Section 232 rule language, the AWM close expected in Q3 2026, and the Q4 shipment ramp that decides whether the full-year revenue hold and FCF conversion guide survive. Management also pointed to held-out international orders beginning to enter the book in H2 2026, plus the Atlas ramp as an early read on share of wallet.
- Week of Aug 5, 2026Section 232 rule language — Tests whether new steel-content duties hit Array's primary input.
- Couple weeks from Aug 5, 2026APA Days technical event — Investor/technical event tied to APA's first acquisition anniversary.
- Q3 2026AWM acquisition close — Tests the second M&A step and expected year-one accretion before synergies.
- Q3 2026Q3 revenue print — Guided at $310–330 million; sets up the Q4-heavy delivery plan.
- H2 2026Held-out international order book entry — Management expects some international wins to begin entering the reported book.
- Later 2026DuraTrack 60-degree quote availability — Extreme-weather variant available to quote; deliveries expected mid-2027.
Financials
Annual Summary
| Metric | FY2024 | FY2025 | TTM | YoY |
|---|---|---|---|---|
| Revenue | $916M | $1.3B | $1.2B | +40.2% |
| Gross Margin | 33.0% | 21.9% | 23.7% | 1,105bps |
| EBITDA | −$178M | $121M | $536M | +167.8% |
| EBITDA Margin | -19.5% | 9.4% | 8.6% | +2,891bps |
| Net Income | −$240M | −$52M | −$67M | +78.3% |
| Free Cash Flow | $135M | $80M | $519M | — |
| Net Cash | — | — | — | — |
Key Ratios (Trailing)
- P/E TTM—
- EV/EBITDA TTM—
- EV/Revenue TTM—
- Price/FCF TTM—
- Gross Margin (TTM)23.7%
- EBITDA Margin (TTM)8.6%
- Net Margin (TTM)-5.6%
- ROIC4.9%
- FCF Conversion56.0%
- SBC / Revenue1.4%
The Company
Array Technologies makes utility-scale solar trackers, fixed-tilt racking, engineered foundations, and related software. Its products include DuraTrack HZ v3, OmniTrack terrain-following trackers, D2S international trackers, SkyLink controls, SmarTrack software, and APA Foundation Solutions. AI-driven data center electricity demand is one reason U.S. utility-scale solar projects are growing, and Array supplies the mounting hardware those projects need; the clearest named link is APA racking and foundations, and the pending AWM deal adds cable management for solar, battery storage, and data center customers.
Array operates manufacturing in Albuquerque at about 283,000 sq ft, a new Bernalillo County facility under construction at roughly 176,000 sq ft manufacturing plus 40,000 sq ft office/lab, Spain at about 67,000 sq ft, and Brazil at about 610,000 sq ft. It reports two segments: Array Legacy Operations, which generated $217.4 million of Q1 2026 revenue, and STI Operations, which generated $6.0 million. The company also runs the Array Innovation Center in Chandler, Arizona and an APA headquarters with a 5-acre validation site.
Business Segments
Competitive Landscape
The 10-K names Nextpower Inc. (f/k/a Nextracker, Inc.), PV Hardware, and GameChange Solar as principal tracker competitors, plus UNIRAC and Terrasmart, a Gibraltar subsidiary, in fixed-tilt and foundations.
- Nextpower Inc. (f/k/a Nextracker, Inc.)Named as principal tracker competitor in the 10-K; not discussed further in the source material.
- PV HardwareNamed as principal tracker competitor in the 10-K; not discussed further in the source material.
- GameChange SolarNamed as principal tracker competitor in the 10-K; not discussed further in the source material.
- UNIRAC, Inc.Named as fixed-tilt mounting and engineered foundation competitor in the 10-K; not discussed further.
- Terrasmart (f/k/a RBI Solar Inc.)Named as fixed-tilt mounting and engineered foundation competitor, a subsidiary of Gibraltar Industries; not discussed further.
Supply Chain
Array sits between steel and component suppliers upstream and EPCs/developers downstream. Steel is the dominant input, and the 10-K says the business is significantly affected by steel prices.
More on ARRY: Earnings recap