Generac reported record third-quarter sales, with growth in both its commercial and residential businesses and a sharp increase in profit. Demand from data-center customers helped drive a 28% rise in commercial and industrial sales, while residential sales returned to growth.
The company kept its 2026 sales-growth outlook unchanged but raised the low end of its expected adjusted EBITDA margin range. It also highlighted a long-term generator supply agreement with Amazon, with initial deliveries expected to total $2.4 billion across 2027 and 2028.
Key details
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Record quarterly sales: Net sales rose 16% to $1.29 billion from $1.11 billion a year earlier. Acquisitions, divestitures and foreign-currency movements had a net favorable impact of 1 percentage point on growth.
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Both major segments grew:
- Commercial and industrial sales increased about 28% to $552 million, from $432 million.
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Residential sales increased about 9% to $743 million, from $682 million. Generac said the segment’s return to strong growth was supported by lower power-quality trends.
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Profitability improved: Net income attributable to Generac was $109 million, or $1.83 per share, compared with $66 million, or $1.12 per share, in the year-earlier quarter. On an adjusted basis, net income was $151 million, or $2.54 per share, versus $108 million, or $1.83 per share.
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Adjusted EBITDA margin widened: Adjusted EBITDA, before noncontrolling interests, rose to $256 million from $193 million. Its share of sales increased to 19.8%, from 17.3%.
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Cash generation increased: Cash from operations was $171 million, compared with $118 million a year earlier. Free cash flow rose to $132 million from $96 million.
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Data-center business is adding to the backlog: Generac said its Amazon agreement includes a long-term supply arrangement for backup generators at Amazon data centers. Initial deliveries are expected to total $2.4 billion in 2027 and 2028. The company also cited additional commitments from data-center customers and other wins from new and existing customers, but did not give a total backlog figure in the material provided.
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Sales outlook was maintained: Generac continues to expect full-year 2026 net sales growth in the mid-to-high teens percentage range compared with 2025.
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Margin outlook improved at the low end: The company now expects full-year adjusted EBITDA margin, before noncontrolling interests, of approximately 20.5% to 21.0%, versus its previous range of 20.0% to 21.0%.
Plain-English implications
Generac’s quarterly growth was led by commercial and industrial demand, while residential sales also advanced. The higher adjusted EBITDA margin indicates improved profitability relative to sales in the quarter. The Amazon supply agreement provides a sizable stated delivery commitment for 2027 and 2028; it is separate from the company’s 2026 sales outlook.