Earnings Recap — Q2 FY2026
CY Q3 2026 · Reported August 5, 2026 · Beat 6 of last 7 quarters
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Solaris's record quarter and expanded contracts with three investment-grade technology companies underscore the accelerating demand for behind-the-meter power solutions for AI data centers. The company's ability to secure long-term contracts and expand scope, including balance of plant and energy storage, positions it as a key enabler of the AI infrastructure buildout, particularly given grid interconnection delays and the focus on speed to compute. The acquisition of GESA and investment in SMR technology further enhance its capabilities to support large-scale power needs.
Solaris delivered record Q2 FY2026 results with revenue of $219M and adjusted EBITDA of $108M, up 12% and 30% sequentially, respectively. Power Solutions segment revenue grew 23% sequentially to $158M, driven by increased ancillary service revenue, while Logistics segment revenue declined 10% to $61M but adjusted EBITDA increased 7% to $25M. The company expanded contracts with three investment-grade technology customers, including converting the Hatchbo agreement into a comprehensive capacity and operating agreement with extended term, and acquired GESA to expand full-cycle power services. They also issued $1.3B in senior unsecured notes, secured a $650M revolver, and received investment-grade credit ratings.
Management raised Q3 FY2026 adjusted EBITDA guidance to $90M-$105M, reflecting the GESA acquisition and continued execution, and established initial Q4 FY2026 guidance of $100M-$120M, reflecting the ramp of energization at Stateline and the first location for the third hyperscaler customer. They highlighted approximately 800 MW of open capacity with near-term delivery timelines and active negotiations for multiple gigawatts of additional demand with hyperscalers and AI compute companies. The company expects to begin earning revenue on the expanded Hatchbo contract in January 2027 and expects energization of the first deployment under the April contract next month. Management emphasized that current contract cash flows exceed enterprise value, and they see significant upside from GESA and additional ancillary services.
“We expect the cash flow generated from our current contracts well exceeds our enterprise value today before including any additional cash flow from assets on order that are not yet contracted.”
on Valuation disconnect
“Our long-term customers have come back to expand their contracts, seeking more capacity and scope and longer tenor.”
on Contract expansion
“We are excited about additional opportunities that we're actively evaluating that we believe will strengthen Solaris over the long run.”
on Growth momentum
You've added a lot of new capabilities recently. I'm looking at Slide 4, which now has quite a long list of upside strategies. Could you help frame the magnitude of the upside potential as you look at your deployed and contracted fleet over time?
Bill Zartler said the slide deck is conservative and does not include much option value from GESA growth. He highlighted GESA's global footprint and opportunities in aftermarket activity and equipment refurbishment, which could generate significant additional cash over the next year or two.
I wanted to ask on thoughts around financing potential future growth. We've obviously seen what William has done recently with the partner in Blackstone and just your appetite for something like that and what could potentially catalyze it.
Steve Tompsett said the company has significant liquidity for current projects and incremental debt capacity for small additions. For larger opportunities, they are in discussions with market participants about project finance or partnership structures, and will be flexible based on cost of capital and flexibility.
So balance of plant is really starting to show up in the numbers and it's clearly a big part of your execution platform. Can you talk about how much of your deployed capacity by the end of '27 will have a contracted balance of plant element?
Bill Zartler said the goal is to control and operate more of the plant as a single unit, and Amanda Brock added that customers prefer a turnkey approach. They did not provide a specific percentage but indicated a trend toward more balance of plant scope.