Bookings Surge 268% as Backlog Breaks the $1.5 Billion Mark
Forgent Power Solutions (NYSE: FPS) wasted no time making a statement in its first earnings release as a public company. Bookings exploded by 268% year-over-year to $762 million in the fiscal second quarter of 2026, sharply outpacing revenue growth and pushing the company’s backlog past $1.5 billion—a figure that not only doubled versus last year but jumped 45% sequentially. The book-to-bill ratio soared to 2.6x, signaling robust demand from data center, grid, and industrial customers.
Revenue Growth Translates to Improved Profitability Despite One-Time Costs
Revenues leapt 69% to $296 million, driven by strong order momentum and share gains across major end-markets. Importantly, while the company reported a net loss of $0.1 million due to a $10 million write-off from refinancing activities, core profitability measures improved substantially. Adjusted EBITDA rose 51% to $60 million, and adjusted net income climbed 66% to $36 million—reflecting higher gross profit even as operating expenses were elevated by rapid hiring and expansion costs.
| Key Metric | Q2 2026 | Q2 2025 | % Change |
|---|---|---|---|
| Revenue | $296M | $175M | +69% |
| Bookings | $762M | $207M* | +268% |
| Backlog | $1.5B | $750M | +100% |
| Book-to-Bill Ratio | 2.6x | 1.6x | +58% |
| Adjusted EBITDA | $60M | $40M | +51% |
| Adjusted Net Income | $36M | $21M | +66% |
*Estimated for illustration; not explicitly provided in release.
Guidance Raised: Management Expects 73% Revenue Growth in 2026
On the back of its swelling order book and expanded production capacity, Forgent raised its full-year financial targets for 2026. Revenue guidance now stands at $1,275–$1,325 million (up 73% year-over-year at the midpoint), with adjusted EBITDA expected between $300–$310 million (+80%), and adjusted net income projected at $190–$200 million (+120%). Management cited exceptionally strong demand, particularly from data center and grid customers, as a key driver of these targets.
| 2026 Guidance | Low | High | YoY Growth % (at Midpoint) |
|---|---|---|---|
| Revenue ($M) | 1,275 | 1,325 | 73% |
| Adjusted EBITDA ($M) | 300 | 310 | 80% |
| Adjusted Net Income ($M) | 190 | 200 | 120% |
Capacity Expansion and Order Visibility Set Stage for Continued Growth
The company’s accelerated capacity expansion plan remains on track for completion by end of fiscal 2026, with current investments positioning Forgent to support up to $5 billion of annual revenues in future years. Capital expenditures in Q2 totaled $26 million, focused almost entirely on new campus construction and equipment.
Management expects margin expansion over the balance of the year, as ramping production volumes are anticipated to lower under-absorbed labor and overhead. Forward visibility appears strong: as of year-end, deferred revenue and backlog far exceed revenue run rates.
Takeaway: Order Momentum Signals Forgent’s Role as a Key Infrastructure Supplier
Forgent’s results point to breakneck demand for specialized electrical distribution equipment—a trend underpinned by surging data center and grid investments. Its ability to deliver highly customized solutions at speed has clearly resonated with customers, as revealed by the remarkable bookings performance and record backlog. Investors and industry followers will want to monitor how this order pipeline translates into continued revenue and margin growth as the company scales its output over the coming quarters.
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