This is a strong_beat with raised guidance — the EPS miss is entirely non-operational (one-time IPO/sponsor costs). The revenue acceleration, record backlog, and margin expansion trajectory confirm the data center/grid demand thesis. Watch for follow-on analyst upgrades and potential capacity constraint updates on the conference call. The stock should re-rate higher on the revenue beat and guidance raise.
Price Chart
Executive Summary
Forgent Power Solutions reported a massive Q3 FY2026 beat: revenue of $378.7M (+103% YoY) crushed the $341.9M consensus, while GAAP EPS of $0.10 (net income $24.5M) missed the $0.17 Street estimate. The company raised full-year FY2026 guidance to $1.35B-$1.39B revenue (82% YoY growth at midpoint) and $310M-$320M Adjusted EBITDA, citing record orders ($867M, +308% YoY), a $1.98B backlog (+157% YoY), and sequential margin expansion. The EPS miss is a mechanical artifact of one-time sponsor fees and IPO-related costs, not operational deterioration — the underlying business is accelerating sharply.
Key Financial Metrics
Key Facts
- Revenue of $378.7M, +103% YoY, vs $341.9M consensus (10.8% beat)
- GAAP net income of $24.5M, +190% YoY; GAAP EPS of $0.10 vs $0.17 consensus (miss due to $16.9M in one-time public company readiness costs)
- Adjusted EBITDA of $84.7M, +96% YoY; Adjusted EBITDA margin 22.4%, up 200 bps sequentially
- Record bookings of $867M, +308% YoY; book-to-bill of 2.3x
- Backlog of $1.98B, +157% YoY and +33% QoQ
- Raised full-year FY2026 guidance: revenue $1.35B-$1.39B (from $1.275B-$1.325B), Adjusted EBITDA $310M-$320M (from $300M-$310M)
- Operating cash flow of $29M, improved $37M YoY; capex of $28M for capacity expansion on track for FY2026 completion
- Capacity expansion to support up to $5B annual revenue; maintenance capex expected at ~1% of revenue thereafter
Financial Impact
Revenue beat of $36.8M (10.8%) vs consensus; guidance raised by $70M at midpoint for full year; Adjusted EBITDA guidance raised by $10M at midpoint
Risk Factors
- Capacity expansion delays could constrain revenue growth in FY2027
- Under-absorbed labor and overhead costs at new campuses may persist longer than expected
- Data center investment cycle could slow if AI capex decelerates
- Raw material cost inflation (steel, copper) and tariff exposure
- High customer concentration risk as Powertrain Solutions scales
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 6 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0002080126-26-000017 |
| Document: fps-20260514.htm | 0002080126-26-000017 |
| Document: 0002080126-26-000017-index-headers.html | 0002080126-26-000017 |
| Document: 0002080126-26-000017-index.html | 0002080126-26-000017 |
| Document: 0002080126-26-000017.txt | 0002080126-26-000017 |
| 8-K Data (Synthetic) | 0002080126-26-000017 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Sep 15, 2026 17d ago | 8-K | $31.36 $39.44 | ▲ +25.77% | ▲ +24.95% | $40.27 (+28.41%) |
Aug 22, 2026 5w ago | Institutional Cluster | $32.19 $30.54 | ▼ −5.13% | ▼ −5.59% | $40.27 (+25.10%) |
Jul 2, 2026 13w ago | EFFECT | $46.86 $46.15 | ▲ +1.52% | ▲ +2.45% | $40.27 (+14.06%) |
Jun 29, 2026 13w ago | S-1 | $55.86 $47.50 | ▼ −14.97% | ▼ −15.57% | $40.27 (−27.91%) |
May 30, 2026 17w ago | 424B4 | $56.35 $59.13 | ▼ −4.93% | ▼ −7.68% | $40.27 (+28.54%) |
May 29, 2026 18w ago | EFFECT | $54.66 $59.13 | ▼ −8.18% | ▼ −10.70% | $40.27 (+26.33%) |
May 26, 2026 18w ago | S-1 | $47.30 $56.88 | ▼ −20.25% | ▼ −19.05% | $40.27 (+14.86%) |
May 14, 2026 20w ago | 8-K | $50.19 $48.52 | ▼ −3.33% | ▼ −2.61% | $40.27 (−19.76%) |
Mar 24, 2026 27w ago | S-1 | $32.47 $29.13 | ▼ −10.29% | ▼ −10.04% | $40.27 (+24.02%) |
US Market Status
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