Generac Reports Third Quarter 2026 Results

Further momentum in the C&I segment drives significant backlog increase; Residential segment returns to strong growth in the quarter supported by lower power quality mega-trends

WAUKESHA, WISCONSIN (October 28, 2026) – Generac Holdings Inc. (NYSE: GNRC) (“Generac” or the “Company”), a leading global designer and manufacturer of energy technology solutions and other power products, today reported financial results for its third quarter ended September 30, 2026, and provided an update on its outlook for the full year 2026.

Third Quarter 2026 Highlights

“I’m incredibly proud of our team’s efforts as our third quarter results reflect an all-time record for net sales as we continued to see tremendous momentum in our C&I segment during the third quarter with significant additional commitments from data center customers providing further confidence in our position as a leading provider to this large and rapidly growing market,” said Aaron Jagdfeld, President and Chief Executive Officer. “Following the recently announced agreement with Amazon, along with other wins from both new and existing customers, our backlog for products to be sold to the data center market has now grown to approximately $4.5 billion, and we continue to execute on our previously announced capacity expansion plans that will allow us to capture this generational growth opportunity.”

Jagdfeld continued, “Additionally, our Residential segment returned to strong year-over-year growth during the quarter as the mega-trends around lower power quality supported an impressive increase in shipments of home standby and portable generators relative to the prior year period.”

Additional Third Quarter 2026 Consolidated Highlights

Gross profit margin was 39.9% as compared to 38.3% in the prior year third quarter. The increase was primarily driven by favorable price/cost impacts in the current year quarter, including lower tariff costs, partially offset by unfavorable sales mix.

Operating expenses increased by $31.6 million, or 10%, as compared to the third quarter of 2025. The increase was primarily driven by increased operating expense investments to support future C&I growth, as well as higher marketing spend to drive awareness for our products and additional incentive compensation and intangible amortization expense, partially offset by lower operating expense investment in energy technology solutions.

Provision for income taxes for the current year quarter was $34.2 million, or an effective tax rate of 23.9%, as compared to $11.8 million, or a 15.0% effective tax rate, for the prior year quarter. The increase in the effective tax rate was primarily driven by certain favorable discrete tax items in the prior year quarter that did not repeat in the current year.

Cash flow from operations was $171.0 million during the third quarter, as compared to $118.4 million in the prior year. Free cash flow, as defined in the accompanying reconciliation schedules, was $131.7 million as compared to $96.5 million in the third quarter of 2025. This strong increase was primarily driven by higher operating earnings, partially offset by increased capital expenditures.

Third Quarter Business Segment Results

Commercial & Industrial Segment

Commercial & Industrial segment total sales increased approximately 28% to $553.0 million from $432.4 million in the prior year quarter, including an approximate 4% net favorable impact to sales growth from the combination of acquisitions, divestitures, and foreign currency. The core total sales growth for the segment was primarily driven by ramping revenue from products sold into the global data center market. In addition, broad-based regional growth internationally was offset by lower shipments to the domestic industrial distributor and telecom channels.

Adjusted EBITDA for the segment, before deducting for noncontrolling interests, was $69.3 million, or 12.5% of C&I total sales, as compared to $43.8 million, or 10.1% of total sales, in the prior year. This margin increase was primarily driven by operating leverage on higher shipments and the net favorable impact of acquisitions/divestitures.

Residential Segment

Residential segment total sales increased approximately 9% to $744.1 million as compared to $685.0 million in the prior year quarter. This increase was primarily driven by strong sales growth for home standby and portable generators compared to the prior year, partially offset by lower shipments of energy storage systems.

Adjusted EBITDA for the segment was $200.8 million, or 27.0% of Residential segment total sales, as compared to $160.2 million, or 23.4% of Residential sales, in the prior year. This margin increase was primarily driven by favorable price/cost impacts, operating leverage given higher shipment volumes, and lower operating expense investment in energy technology solutions.

2026 Outlook

The Company is maintaining its full-year 2026 net sales growth guidance in the mid-to-high teens percent range as compared to the prior year, including an approximate 2% favorable impact from the net effect of foreign currency, acquisitions, and divestitures.

Additionally, the Company is maintaining its guidance for net income margin, before deducting for non-controlling interests, of approximately 9.0 to 10.0% for the full-year 2026. The corresponding adjusted EBITDA margin guidance is now expected to be approximately 20.5 to 21.0% as compared to the previous guidance range of approximately 20.0 to 21.0%.

Conference Call and Webcast

Generac management will hold a conference call at 10:00 a.m. EDT on Wednesday, October 28, 2026 to discuss third quarter 2026 operating results. A webcast of the conference call can be accessed at the following link: https://edge.media-server.com/mmc/p/oci8r36p

The webcast of the conference call is also available on Generac's website (http://www.generac.com), accessed under the Investor Relations link. The webcast link will be made available on the Company’s website prior to the start of the call within the Events section of the Investor Relations website.

Following the live webcast, a replay will be available on the Company’s website for 12 months.

About Generac

Generac is a total energy solutions company that empowers people to use energy on their own terms. Founded in 1959, Generac is a leading global designer, manufacturer, and provider of a wide range of energy technology solutions. The Company provides power generation equipment, energy storage systems, energy management devices & solutions, and other power products and services serving the residential, commercial, data center, telecom, rental, and industrial markets. The Company’s broad portfolio of energy technology offerings for homes and businesses enables its mission to Power a Smarter World and lead the evolution to more resilient, efficient, and innovative energy solutions.

Forward-looking Information

Certain statements contained in this news release, as well as other information provided from time to time by Generac Holdings Inc. or its employees, may contain forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Forward-looking statements give Generac's current expectations and projections relating to the Company's financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as "anticipate," "estimate," "expect," "forecast," "project," "plan," "intend," "believe," "confident," "may," "should," "can have," "likely," "future," "optimistic" and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events.

Any such forward-looking statements are not guarantees of performance or results, and involve risks, uncertainties (some of which are beyond the Company's control) and assumptions. Although Generac believes any forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect Generac's actual financial results and cause them to differ materially from those anticipated in any forward- looking statements, including:

Should one or more of these risks or uncertainties materialize, Generac's actual results may vary in material respects from those projected in any forward-looking statements. A detailed discussion of these and other factors that may affect future results is contained in Generac's filings with the U.S. Securities and Exchange Commission ("SEC"), particularly in the Risk Factors section of the Annual Report on Form 10-K and in its periodic reports on Form 10-Q. Stockholders, potential investors and other readers should consider these factors carefully in evaluating the forward-looking statements.

Any forward-looking statement made by Generac in this press release speaks only as of the date on which it is made.  Generac undertakes no obligation to update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

Non-GAAP Financial Metrics

Core Sales

The Company references core sales to further supplement Generac's consolidated financial statements presented in accordance with U.S. GAAP. Core sales excludes the impact of acquisitions, divestitures, and fluctuations in foreign currency translation. Management believes that core sales facilitates easier and more meaningful comparison of net sales performance with prior and future periods.

Adjusted EBITDA

To supplement Generac’s consolidated financial statements presented in accordance with U.S. GAAP, the Company provides the computation of Adjusted EBITDA attributable to the Company, which is defined as net income (loss) before noncontrolling interests adjusted for the following items: interest expense, depreciation expense, amortization of intangible assets, income tax expense (benefit), certain non-cash gains and losses including certain purchase accounting adjustments and contingent consideration adjustments, share-based compensation expense, certain transaction costs and credit facility fees, business optimization expenses, provision for certain legal and regulatory charges, certain specific provisions, mark-to-market gains and losses on a minority investment, and Adjusted EBITDA attributable to noncontrolling interests. The provision for legal and regulatory charges adjusts for matters that are significant and not part of the ordinary routine litigation or regulatory matters incidental to the Company’s business, such as large suits and settlements, class action lawsuits, government inquiries and certain intellectual property litigation. The adjustments to net income (loss) in computing Adjusted EBITDA are set forth in the reconciliation table below. The computation of Adjusted EBITDA is based primarily on the definition included in our Credit Agreement.

Adjusted Net Income

To further supplement Generac's consolidated financial statements presented in accordance with U.S. GAAP, the Company provides a summary to show the computation of adjusted net income attributable to the Company. Adjusted net income attributable to the Company is defined as net income (loss) before noncontrolling interests adjusted for the following items: amortization of intangible assets, amortization of deferred financing costs and original issue discount related to the Company's debt, intangible impairment charges, certain transaction costs and other purchase accounting adjustments, business optimization expenses, provision for certain legal and regulatory charges, certain specific provisions, mark-to-market gains and losses on a minority investment, other non-cash gains and losses, and adjusted net income attributable to non-controlling interests.

Free Cash Flow

In addition, the Company references free cash flow to further supplement Generac's consolidated financial statements presented in accordance with U.S. GAAP. Free cash flow is defined as net cash provided by operating activities, less expenditures for property and equipment, and is intended to be a measure of operational cash flow taking into account additional capital expenditure investment into the business.

The presentation of this additional information is not meant to be considered in isolation of, or as a substitute for, results prepared in accordance with U.S. GAAP.  Please see the accompanying Reconciliation Schedules and our SEC filings for additional discussion of the basis for Generac's reporting of Non-GAAP financial measures, which includes why the Company believes these measures provide useful information to investors and the additional purposes for which management uses the non-GAAP financial information.

SOURCE: Generac Holdings Inc.

CONTACT:

Kris Rosemann

Senior Director – Corporate Finance & Investor Relations
(262) 506-6064
InvestorRelations@generac.com

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(1) Includes (gains)/losses on the disposition of assets other than in the ordinary course of business, (gains)/losses on sales of certain investments, unrealized mark-to-market adjustments on commodity contracts, certain foreign currency related adjustments, and certain purchase accounting and contingent consideration adjustments. A full description of these and the other reconciliation adjustments contained in these schedules is included in Generac's SEC filings. 

(2) Represents share-based compensation expense to account for stock options, restricted stock, and other stock awards over their respective vesting periods.

(3) Represents transaction costs incurred directly in connection with any investment, as defined in our credit agreement, equity issuance or debt issuance or refinancing, together with certain fees relating to our senior secured credit facilities, such as administrative agent fees and credit facility commitment fees under our Credit Agreements.

(4) Represents severance and other restructuring charges related to the consolidation of certain operating facilities and organizational functions.

(5) Represents the following significant litigation, regulatory, and other matters that are not indicative of our ongoing operations:

(6) Represents non-cash (gains) losses primarily from changes in the fair value of the Company's investment in Wallbox N.V. warrants and equity securities.

(7) Represents third party costs and the write-off of certain deferred financing costs in connection with the refinancing of the Tranche A Term Loan Facility and Revolving Debt Facility.

(8) The current year loss relates primarily to four immaterial business dispositions with two closing in the first quarter and two closing in the second quarter of 2026. The prior year loss relates primarily to one immaterial business disposition that closed in the second quarter of 2025.

(9) Represents transaction costs incurred directly in connection with any investment, as defined in our credit agreement, equity issuance or debt issuance or refinancing, and certain purchase accounting and contingent consideration adjustments.